TransGlobe Energy Corporation Provides Capital Program and Guidance for 2011 and Notice of Participation at Global Energy Confer
November 29 2010 - 7:00AM
Marketwired
TransGlobe Energy Corporation ("TransGlobe" or the "Company") (TSX:
TGL) (NASDAQ: TGA) is pleased to announce an increased Capital
Budget, estimated production and funds flow from operations
Guidance for 2011. All dollar values are expressed in United States
dollars unless otherwise stated.
2011 Capital Budget
TransGlobe has set its initial 2011 Capital Budget at $90.0
million (firm plus contingent) representing a 28% increase over the
2010 Capital Budget. The majority of the Capital Budget is
dedicated to the Arta/East Arta development project.
Summary of capital expenditures and wells:
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Firm & Contingent ($MM) Number of Wells
Total Development Exploration Total Development Exploration
----------------------------------------------------------------------------
West Gharib 62.6 54.5 8.1 44 35 9
East Ghazalat 9.8 8.0 1.8 6 5 1
Nuqra 4.2 - 4.2 2 - 2
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Total Egypt 76.6 62.5 14.1 52 40 12
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West Yemen 9.8 6.7 3.1 8 5 3
East Yemen 1.9 1.0 0.9 1 - 1
----------------------------------------------------------------------------
Total Yemen 11.7 7.7 4.0 9 5 4
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Corporate 1.7 1.7 -
----------------------------------------------------------------------------
Total Budget 90.0 71.9 18.1 61 45 16
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It is anticipated the Company will fund its 2011 Capital Budget
from funds flow from operations and working capital. Funds flow
from operations is a non-GAAP measure that represents cash
generated from operating activities before changes in non-cash
working capital.
2011 Guidance - Production and Funds Flow from Operations
TransGlobe is forecasting base production guidance for 2011 at
13,000 to 13,500 barrels of oil per day ("Bopd"). The mid-point of
13,250 Bopd represents a 33% increase over the estimated 2010
production of 10,000 Bopd. This forecast excludes any production
contribution from the East Ghazalat project.
The East Ghazalat project could contribute an additional 600 to
1,000 Bopd in 2011 based on internal estimates. The operator, Vegas
Oil and Gas SA, has indicated it plans to file for an early
production approval by the first quarter of 2011. TransGlobe will
update production guidance following approval by the Egyptian
Government.
Base Assumptions:
-- West Gharib Production: 10,350 Bopd.
-- West Yemen Production: 2,400 Bopd.
-- East Yemen Production: 500 Bopd.
-- No production assumed from East Ghazalat, pending government approval.
-- No production assumed from Exploration wells.
-- Average Nukhul development well initial rate of 220 Bopd with an
approximate decline of 60% in the first year.
Although several scenarios exist which could improve the current
estimate, the Base forecast has been used to provide 2011 guidance
until longer production histories and additional well results
support a revised forecast.
Funds flow from operations is forecast to be $101 million
($1.43/share) based on an average Dated Brent oil price of
$75.00/Bbl using the mid-point of production guidance of 13,250
Bopd. The 2011 funds flow from operations sensitivity to a change
in oil price is approximately $13 million per $10.00 change in
Dated Brent. Funds flow from operations would be $114 million
($1.62/share) at $85.00/Bbl Dated Brent and $88 million
($1.25/share) at $65.00/Bbl.
The East Ghazalat development could add an additional $7 million
($0.10/share) of funds flow from operations in 2011, assuming it
proceeds as planned.
INVESTOR PRESENTATION - CANACCORD GENUITY GLOBAL ENERGY
CONFERENCE
Mr. Clarkson will make a presentation on the Company at the
Canaccord Genuity Global Energy Conference in Miami, Florida on
November 30, 2010 at 3:20 PM Eastern Time (1:20 PM Mountain Time).
Investors may register directly for the live web cast at:
http://www.wsw.com/webcast/canaccord3/.
Links to the webcast of Mr. Clarkson's presentation will also be
provided on TransGlobe's Web site at www.trans-globe.com.
TransGlobe Energy Corporation is a Calgary-based,
growth-oriented oil and gas exploration and development company
focused on the Middle East/North Africa region with production
operations in the Arab Republic of Egypt and the Republic of Yemen.
TransGlobe's common shares trade on the Toronto Stock Exchange
under the symbol TGL and on the NASDAQ Exchange under the symbol
TGA.
Cautionary Statement to Investors:
This news release may include certain statements that may be
deemed to be "forward-looking statements" within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. Such
statements relate to possible future events. 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",
"plan", "continue", "estimate", "expect", "may", "will", "project",
"predict", "potential", "targeting", "intend", "could", "might",
"should", "believe" and similar expressions. These statements
involve known and unknown risks, uncertainties and other factors
that may cause actual results or events to differ materially from
those anticipated in such forward-looking statements. Although
TransGlobe's forward-looking statements are based on the beliefs,
expectations, opinions and assumptions of the Company's management
on the date the statements are made, such statements are inherently
uncertain and provide no guarantee of future performance. Actual
results may differ materially from TransGlobe's expectations as
reflected in such forward-looking statements as a result of various
factors, many of which are beyond the control of the Company. These
factors include, but are not limited to, unforeseen changes in the
rate of production from TransGlobe's oil and gas properties,
changes in price of crude oil and natural gas, adverse technical
factors associated with exploration, development, production or
transportation of TransGlobe's crude oil and natural gas reserves,
changes or disruptions in the political or fiscal regimes in
TransGlobe's areas of activity, changes in tax, energy or other
laws or regulations, changes in significant capital expenditures,
delays or disruptions in production due to shortages of skilled
manpower, equipment or materials, economic fluctuations, and other
factors beyond the Company's control. TransGlobe does not assume
any obligation to update forward-looking statements if
circumstances or management's beliefs, expectations or opinions
should change, other than as required by law, and investors should
not attribute undue certainty to, or place undue reliance on, any
forward-looking statements. Please consult TransGlobe's public
filings at www.sedar.com and www.sec.gov/edgar.shtml for further,
more detailed information concerning these matters.
Contacts: TransGlobe Energy Corporation Scott Koyich Investor
Relations 403.262.9888 investor.relations@trans-globe.com
www.trans-globe.com
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