Parex Resources Announces 13% Growth in Proved Developed Producing Reserves and 171% 2P Reserve Replacement

Parex Resources release

CALGARY, Alberta, Feb.  06, 2020  (GLOBE NEWSWIRE) -- Parex Resources Inc. (“Parex” or the "Company") (TSX:PXT) is pleased to announce the results of its annual independent reserves assessment as at December 31, 2019 and to provide an operational update.  

The financial and operational information contained below is based on the Company’s unaudited expected results for the year ended December 31, 2019.  All currency amounts are in United States dollars, unless otherwise stated.

2019 Year-End Corporate Reserves Report

On a debt adjusted basis, production per share grew 34% and proved plus probable (“2P”) reserves per share increased by 18%. We exited 2019 with working capital of approximately $340 million and no debt. In 2020, we have multiple opportunities for continued growth and are expecting to generate significant free cash flow, in excess of capital expenditures and sufficient to support the Company’s share buyback program.  

For the year ended December 31, 2019, Parex:   

• Added 27.6 million barrels of oil equivalent ("MMboe") proved developed producing reserves (“PDP”), 36.4 MMboe proved (“1P”) reserves, and 33 MMboe 2P reserves replacing respectively 143%, 189% and 171% of total 2019 production (19.23 MMboe);
• Increased PDP reserves by 13% year-over-year, from 63 MMboe to 71 MMboe (98% crude oil);
• Grew 2P reserves 7% from 185 MMboe to 198 MMboe (97% crude oil);
• Realized PDP finding, development & acquisition (“FD&A”) costs of $7.63 per barrel of oil equivalent (“boe”), resulting in a 3.8 times funds flow from operations netback recycle ratio using the unaudited 2019 funds flow from operations of $29.30/boe;
• Achieved 2P finding & development costs and 2P FD&A costs of $7.57/boe. Using the unaudited 2019 funds flow from operations of $29.30/boe, the 2P FD&A funds flow from operations  netback recycle ratio was 3.9 times;
• Realized an after tax 1P net asset value (“NAV”) per share of C$27.15 and 2P NAV of C$35.58 per share, discounted at 10% and using the 2019 GLJ Report price forecast;
• Using a constant $60/bbl Brent oil price, achieved an after tax 1P NAV per share of C$22.45 and 2P NAV of C$28.80 per share, discounted at 10%; and
• Produced on average approximately 52,687 barrels of oil equivalent per day (“boe/d”), representing a 19% increase over the 2018 daily average production using a conversion of six mcf of gas to barrel of oil. Production consisted of 51,708 barrels of oil per day (“bopd”) and 5,874 Mcf per day (“Mcf/d) of natural gas.  

We estimate Q4 2019 production at approximately 54,221 boe/d, up ~2% from Q3 2019, consisting of 53,086 bopd and 6,810 Mcf/d of natural gas.

The full release is available here.