CALGARY, ALBERTA–(Marketwired – Jan. 23, 2017) – RMP Energy Inc. (“RMP” or the “Company“) (TSX:RMP) announces today the appointment of a President, a new Chairman of the Board and provides an update on its board of directors and its field operations.
New President and Chairman of the Board Appointments
The Company is pleased to announce that its board of directors has appointed Mr. Jon Grimwood as the President of RMP, effective February 28, 2017, upon the previously announced retirement of Mr. John Ferguson. Mr. Grimwood has been Vice President, Exploration of RMP since May 2011 and has been instrumental in assembling the Company’s Montney acreage position in West Central Alberta. Mr. Grimwood stated, “I am pleased to have the opportunity to move our business plan forward while continuing to develop our exceptional suite of Montney assets for the benefit of all shareholders.” Mr. Grimwood began his career at Poco Petroleums Ltd. and has held various positions of increased responsibility and seniority at Burlington Resources Canada Ltd., Rider Resources Ltd., Galleon Energy Inc. and RMP Energy Ltd. Mr. Grimwood earned a Bachelor of Science from Brandon University, a Masters Degree in Earth Sciences from the University of Waterloo and is a registered member of APEGA
The Company also announces that Mr. Josh Young, a recently appointed independent director of RMP, has succeeded Mr. Craig Stewart as the Company’s non-executive Chairman of the board. Mr. Young is the portfolio manager for Bison Interests LLC (“Bison”), an investment firm specializing in oil and gas investments. Bison currently owns more than 11.5 million common shares of RMP, over 7.5% of the outstanding shares of the Company. Mr. Young commented, “I am honored to be appointed Chairman of RMP. I am focused on alignment between the Company and its shareholders, which should be well-served by the highly-skilled incoming President, Jon Grimwood, and his strong management team”.
Mr. Stewart will remain an independent member of the Company’s board of directors. In addition to this Chairman transition, Mr. John Brussa has retired as a director of RMP. The Company would like to express its appreciation and gratitude to Mr. Brussa for his service and counsel as a RMP board member since May 2011.
The Company’s board of directors now consists of: Messrs. Josh Young, Doug Baker, Andrew Hogg, Jim Saunders, Craig Stewart and Lloyd Swift.
As outlined in RMP’s October 31, 2016 news release, the Company has commenced the delineation of the areal extent of the Middle Montney Formation trend at Gold Creek in West Central Alberta (now known as Elmworth by the Alberta Energy Regulator), in anticipation of proving-up its significant land base for future development. As planned, RMP has drilled a 100% working interest exploration horizontal well at 8-25-68-4W6. This well was recently fracture stimulated in the Middle Montney interval and is currently undergoing clean-up and production flow testing operations. RMP is currently drilling its third Middle Montney well (4-18-68-2W6) at Elmworth/Gold Creek, from the same surface lease pad as its discovery well (3-22-68-3W6), which was drilled and completed in 2016. As disclosed last year, the 3-22 exploration well at the end of its 118 hour clean-up and production test flowed at approximately 300 bbls/d of 40 degree API crude oil and 5.0 MMcf/d of associated sweet solution gas for a total of 1,130 boe/d with a final bottom hole flowing pressure of approximately 17,000 kPa. At Elmworth/Gold Creek, the Company has accumulated a large undeveloped land base consisting of 78 (77.5 net) sections (49,920 gross acres) of operated acreage.
In order to facilitate the tie-in and processing of anticipated future production additions at Elmworth/Gold Creek, RMP has entered into gas processing and oil transportation agreements with a well-capitalized, regional mid-stream service provider, which owns and operates the Patterson Creek Gas Plant. The agreements encompass an area dedication and are not under-pinned by take-or-pay commitments. The mid-stream company is in the process of installing a gathering system, which is expected to be completed in April 2017, and will include both natural gas and crude oil pipeline legs. This gathering system will connect their existing infrastructure to RMP’s oil battery facility at 2-23-68-3W6, which is presently under-construction by RMP with expected commissioning in May 2017. The Company’s Elmworth/Gold Creek natural gas will be processed at the Patterson Creek Gas Plant, which will undergo expansion construction this year with an expected capacity level of 150 MMcf/d by the end of this year. This gas plant will provide pipeline connections for sales gas into both the TransCanada and Alliance gas systems and additionally downstream will connect to Pembina’s Karr terminal for crude oil sales.
At Waskahigan in West Central Alberta, the Company is currently drilling a 100% working interest Montney horizontal oil well (13-30-63-23W5). A hybrid slick water completion operation on this well is scheduled for early February 2017. For this year, the Company is budgeted to drill a total of four (4.0 net) Montney horizontal wells at Waskahigan.
Overall, anticipated production additions from the Company’s modest Waskahigan drilling program in 2017 is expected to maintain corporate base production levels of 3,200 to 3,300 boe/d from Waskahigan and its other non-core areas, collectively (approximately 35% crude oil and NGLs). Additionally, the tie-in of the Company’s Elmworth/Gold Creek 3-22 well in conjunction with successful follow-up drilling and completion at Elmworth/Gold Creek, is expected to augment RMP’s base production profile. The Company expects to provide a further progress update on its Elmworth/Gold Creek infrastructure commissioning in March 2017.
Fiscal 2016 Financial and Reserves Reporting
The Company is scheduled to release its fiscal 2016 audited consolidated financial statements, associated Management’s Discussion and Analysis, and its year-end reserves information on March 21, 2017.
RMP Energy Inc. is a Montney-focused crude oil and natural gas producer, based in Calgary, Alberta. RMP’s common shares trade on the Toronto Stock Exchange under the ticker “RMP”. For additional information on the Company, please visit RMP’s website at: www.rmpenergyinc.com.
|bbl or bbls||barrel or barrels||Mcf/d||thousand cubic feet per day|
|Mbbl||thousand barrels||MMcf/d||million cubic feet per day|
|bbls/d||barrels per day||MMcf||Million cubic feet|
|boe||barrels of oil equivalent||Bcf||billion cubic feet|
|Mboe||thousand barrels of oil equivalent||psi||pounds per square inch|
|boe/d||barrels of oil equivalent per day||kPa||kilopascals|
|NGLs||natural gas liquids||GJ||Gigajoule|
|WTI||West Texas Intermediate||GJ/d||Gigajoules per day|
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “budget”, “plan”, “continue”, “estimate”, “approximate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “would” and similar expressions. More particularly and without limitation, this news release contains forward-looking information relating to, the terms of certain gas processing and oil transportation agreements entered into by RMP with a regional mid-stream service provider, including the anticipated timing of completion of the installation of a gathering system by such mid-stream service provider; the anticipated timing of commissioning RMP’s oil battery facility; expected construction at the Patterson Creek Gas Plant, including the anticipated timing thereof, expected capacity level upon completion and pipeline connections; RMP’s drilling and completion plans, including the anticipated timing of a hybrid slick water completion operation on the Company’s well at Waskahigan and expected total budgeted number of wells to be drilled in at Waskahigan in 2017; anticipated production additions from the Company’s Waskahigan drilling program in 2017, including the Company’s expectation that such production additions will maintain current corporate base production levels; estimated corporate base production levels for the Company and associated crude oil and NGLs weighting; the anticipated effect of the tie-in and successful follow up drilling and completion of the Company’s Elmworth/Gold Creek 3-22 well on the Company’s production profile; anticipated timing of the Company providing a progress update on its Elmworth/Gold Creek infrastructure commissioning; and other matters.
With respect to forward-looking statements contained in this news release, RMP has made assumptions regarding, but not limited to: conditions in general economic and financial markets; effects of regulation by governmental agencies; current and future commodity prices and royalty regimes; future exchange rates; royalty rates; future operating costs; availability of skilled labor; availability of drilling and related equipment; timing and amount of capital expenditures; the impact of increasing competition; the price of crude oil and natural gas; that the Company will have sufficient cash flow, debt or equity sources or other financial resources required to fund its capital and operating expenditures and requirements as needed; that the Company’s conduct and results of operations will be consistent with its expectations; available pipeline capacity; that the Company will have the ability to develop the Company’s properties in the manner currently contemplated; that the Company will be able to drill, complete and tie-in wells in the manner and on the timing described herein; current or, where applicable, proposed assumed industry conditions, laws and regulations will continue in effect or as anticipated; and the estimates of the Company’s production and reserves volumes and the assumptions related thereto (including commodity prices and development costs) are accurate in all material respects.
These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company’s control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; obtaining required approvals of regulatory authorities; unexpected drilling results; the Company’s is unable to achieve its objectives; changes in capital expenditures, reserves or reserves estimates and debt service requirements; the occurrence of unexpected events involved in the exploration for, and the operation and development of, oil and gas properties, including hazards such as fire, explosion, blowouts, cratering, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; changes or fluctuations in production levels; delays in anticipated timing of drilling and completion of wells; lack of available capacity on pipelines; the lack of availability of qualified personnel; uncertainties associated with estimating oil and natural gas reserves; and ability to access sufficient capital from internal and external sources. Many of these risks and uncertainties and additional risk factors are described in the Company’s Annual Information Form which is available at www.sedar.com.
The Company’s actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits that the Company will derive from them. The Company’s forward-looking statements are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements.
Any references in this news release to initial and/or final test or production flow test rates and/or “flush” production rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will commence production and decline thereafter. These test results are not necessarily indicative of long-term performance or ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for the Company.
In this news release RMP has adopted a standard for converting thousands of cubic feet (“mcf“) of natural gas to barrels of oil equivalent (“boe“) of 6 mcf:1 boe. Use of boes may be misleading, particularly if used in isolation. The boe rate is based on an energy equivalent conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different than the energy equivalency of the 6:1 conversion ratio, utilizing the 6:1 conversion ratio may be misleading as an indication of value.
President and Chief Executive Officer
Vice President, Finance and Chief Financial Officer