CALGARY, AB, Jan. 6, 2025 /CNW/ - Spartan Delta Corp. ("Spartan" or the "Company") (TSX: SDE) is pleased to provide an operations update following the successful completion of its 2024 drilling program.
Spartan Delta Corp. logo (CNW Group/Spartan Delta Corp.)
OPERATIONS UPDATE
Spartan continues to execute on its corporate strategy by significantly growing oil and liquids production and acreage in the West Shale Basin Duvernay (the "Duvernay"), focusing on improving well costs and productivity, while leveraging its technical expertise in the Deep Basin to optimize operations, growing production as it continues to develop liquids-rich targets. In the fourth quarter of 2024, Spartan averaged estimated production of approximately 38,523 BOE/d (35% liquids), exceeding forecasted production. Spartan's crude oil and condensate production increased approximately 72% when compared to the fourth quarter of 2023. The Company's portfolio of assets provides shareholders exposure to oil, liquids, and natural gas production and is poised to offer repeatable and economic results presenting the opportunity to generate significant shareholder returns.
Spartan anticipates providing additional details regarding its preliminary 2025 operating budget and guidance on or before the release of its annual results for 2024.
DUVERNAY
To date in the Duvernay, Spartan has successfully drilled 4.0 (3.4 net) wells, including a vertical stratigraphic well, and has completed and brought on-stream 4.0 (3.4 net) wells including an existing drilled, but uncompleted well ("DUC"), all in the Willesden Green Duvernay ("Willesden Green"). Spartan is encouraged by the Duvernay as initial results have outperformed internal expectations.
In the fourth quarter, Spartan completed and brought on-stream 2.0 (1.4 net) wells from a licensed eight well pad at 05-18-042-03W5:
03-26-042-04W5 Spartan completed and brought the well on-stream in November at a lateral length of 3,560 meters (11,680 feet). Initial production results are exceeding internal expectations, averaging 30-day peak sales production of approximately 1,166 BOE/d and 90% liquids (1,019 BBL/d of 48° API crude oil, 28 BBL/d of NGLs, and 0.7 MMcf/d of natural gas).
09-05-042-03W5 Spartan completed and brought the well on-stream in November at a lateral length of 3,720 meters (12,200 feet). Initial production results are exceeding internal expectations, averaging 30-day peak sales production of approximately 1,029 BOE/d and 87% liquids (865 BBL/d of 48° API crude oil, 31 BBL/d of NGLs, and 0.8 MMcf/d of natural gas).
In the fourth quarter, Spartan acquired approximately 11,400 net acres in the Duvernay. To date, Spartan has accumulated approximately 250,000 net acres and believes the majority of its acreage is in the tier one oil and condensate rich Duvernay fairway with initial production results validating this thesis as production rates and flowing pressures are stronger than the nearest offsetting wells completed by the previous operators.
DEEP BASIN
In the fourth quarter, Spartan drilled, completed and brought on-stream 1.0 (1.0 net) well targeting the Wilrich formation.
13-31-044-10W5 with a lateral length of 2,902 meters (9,521 feet), averaged 30-day peak sales production of approximately 2,263 BOE/d and 37% liquids (216 BBL/d condensate, 625 BBL/d of NGLs, and 8.5 MMcf/d of natural gas).
Additionally, in the fourth quarter, Spartan resumed production of 1.0 (1.0 net) Wilrich well with initial test rates of approximately 24.0 MMcf/d, but intermittently shut-in production due to the depressed price of natural gas in the summer.
01-36-044-11W5 with a lateral length of 2,808 meters (9,213 feet), averaged 30-day peak sales production of approximately 4,049 BOE/d and 23% liquids (84 BBL/d condensate, 843 BBL/d of NGLs, and 18.7 MMcf/d of natural gas).
Spartan continues to monitor natural gas prices and will intermittently curtail natural gas production and delay new natural gas production if deemed necessary or accelerate drilling as a result of the contango forward curve.
ABOUT SPARTAN DELTA CORP.
Spartan is committed to creating value for its shareholders, focused on sustainability both in operations and financial performance. The Company's culture is centered on generating Free Funds Flow through responsible oil and gas exploration and development. The Company has established a portfolio of high-quality production and development opportunities in the Deep Basin and the Duvernay. Spartan will continue to focus on the execution of the Company's organic drilling program in the Deep Basin, delivering operational synergies in a respectful and responsible manner to the environment and communities it operates in. The Company is well positioned to continue pursuing optimization in the Deep Basin, participate in the consolidation of the Deep Basin fairway, and continue growing and developing its Duvernay asset by leveraging Spartan's balance sheet and Free Funds Flow.
Spartan's corporate presentation as of January 6, 2025, can be accessed on the Company's website at www.spartandeltacorp.com.
OTHER MEASUREMENTS
All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.
This press release contains various references to the abbreviation "BOE" which means barrels of oil equivalent. Where amounts are expressed on a BOE basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet (Mcf) per barrel (bbl). The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead and is significantly different than the value ratio based on the current price of crude oil and natural gas. This conversion factor is an industry accepted norm and is not based on either energy content or current prices.
References to "oil" in this press release include light crude oil and medium crude oil, combined. National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities ("NI 51-101") includes condensate within the product type of "natural gas liquids". References to "natural gas liquids" or "NGLs" include pentane, butane, propane, and ethane. References to "gas" or "natural gas" relates to conventional natural gas.
References to "liquids" includes crude oil, condensate and NGLs.
FORWARD-LOOKING AND CAUTIONARY STATEMENTS
Certain statements contained within this press release constitute forward-looking statements within the meaning of applicable Canadian securities legislation. 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 "anticipate", "budget", "plan", "endeavor", "continue", "estimate", "evaluate", "expect", "forecast", "monitor", "may", "will", "can", "able", "potential", "target", "intend", "consider", "focus", "identify", "use", "utilize", "manage", "maintain", "remain", "result", "cultivate", "could", "should", "believe" and similar expressions. Spartan believes that the expectations reflected in such forward-looking statements are reasonable as of the date hereof, but no assurance can be given that such expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Without limitation, this press release contains forward-looking statements pertaining to: the business plan, objectives, cost model and strategy of Spartan, continued optimization of its Deep Basin asset, participation in the consolidation of the Deep Basin fairway and advancing its Duvernay strategy; the Company's drilling strategy in the Deep Basin; expected drilling and completions in the Duvernay; Spartan's strategies to deliver strong operational performance and to generate significant shareholder returns; the ability of the Company to achieve drilling success consistent with management's expectations; being well positioned to take advantage of opportunities in the current business environment; Spartan's ability to leverage its balance sheet and Free Funds Flow to progress its Duvernay strategy, to continue pursuing immediate production optimization and responsible future growth with organic drilling, to continue to execute on building an extensive position in the Duvernay; potential future intermittent curtailment of natural gas production and delay or acceleration of new natural gas production depending on natural gas prices; and the timing of release of preliminary 2025 operating budget and guidance.
The forward-looking statements and information are based on certain key expectations and assumptions made by Spartan, including, but not limited to, expectations and assumptions concerning the business plan of Spartan, the timing of and success of future drilling, development and completion activities, the growth opportunities of Spartan's Duvernay acreage, the performance of existing wells, the performance of new wells, the availability and performance of facilities and pipelines, the geological characteristics of Spartan's properties, the successful application of drilling, completion and seismic technology, prevailing weather conditions, prevailing legislation affecting the oil and gas industry, prevailing commodity prices, price volatility, future commodity prices, price differentials and the actual prices received for the Company's products, anticipated fluctuations in foreign exchange and interest rates, impact of inflation on costs, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the availability of capital, labour and services, the creditworthiness of industry partners, general economic conditions, and the ability to source and complete acquisitions.
Although Spartan believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Spartan can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed. These risks and uncertainties include, but are not limited to, fluctuations in commodity prices; changes in industry regulations and legislation (including, but not limited to, tariffs, tax laws, royalties, and environmental regulations); changes in the political landscape both domestically and abroad, wars (including Russia's military actions in Ukraine and the Israel-Hamas conflict in Gaza), hostilities, civil insurrections, foreign exchange or interest rates, increased operating and capital costs due to inflationary pressures (actual and anticipated), risks associated with the oil and gas industry in general, stock market and financial system volatility, impacts of pandemics, the retention of key management and employees, risks with respect to unplanned third-party pipeline outages and risks relating to inclement and severe weather events and natural disasters, including fire, drought, and flooding, including in respect of safety, asset integrity and shutting-in production.
Please refer to Spartan's management's discussion and analysis for the period ended September 30, 2024, and annual information form for the year ended December 31, 2023, for discussion of additional risk factors relating to the Company, which can be accessed either on Spartan's website at www.spartandeltacorp.com or under Spartan's SEDAR+ profile on www.sedarplus.ca. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Spartan undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
References in this press release to peak rates, initial production rates, test rates, average 30-day production and other short-term 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 and are not indicative of long-term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production of Spartan. The Company cautions that such results should be considered preliminary.
