Obsidian Energy Announces Operational Update and Investor Day Details

CALGARY, Oct. 10, 2018 /CNW/ – OBSIDIAN ENERGY LTD. (TSX – OBE, NYSE – OBE.BC) (“Obsidian Energy“, the “Company“, “we“, “us” or “our“) is pleased to announce an operational update and timing details for our third quarter results and Investor Day.

Operational Update

Obsidian Energy is on track to deliver meaningful 2019 light oil production growth from our Willesden Green Cardium program. The second half 2018 Cardium drilling program has been evaluated across a range of pricing and crude oil differentials. With the expected well rates and costs, Obsidian Energy anticipates competitive economic returns with the current outlook on Canadian dollar light oil differentials.

The first rig in Willesden Green finished drilling the three well 08-09 pad within the Crimson Lake unit. These wells will be completed in mid-October, with production expected to be online in mid-November. The wells are directly offsetting five wells from earlier this year which averaged 650 boe per day per well (85 percent oil) for the first 30 days of production.  During drilling operations at 08-09, we noted very similar geological structure and quality, drilling rates, and strip log readings to the offset wells drilled from the five wells earlier this year. The second well on this pad is our new pacesetter for wells that require intermediate casing. We drilled this well in less than 13.4 days, approximately 20 percent faster than our H1 2018 program.

We now have two active rigs in the Cardium just east of the North Saskatchewan River in the Eastern flank of Willesden Green. The rigs are drilling directly offsetting a two well pad from earlier this year which averaged approximately 375 boe per day per well (87 percent oil) for both the first 30 and 60 days of production. The first rig has finished drilling the first well on our two well 14-01 pad, and completions for the pad will begin in late October. We drilled all 4,100 meters of main hole in this monobore well using a single bottom-hole assembly. The second rig has finished drilling its second well on the three well 04-06 pad.  Fracturing operations will begin on this pad in mid-November.

Between the two rigs we have in the area, we are drilling the seventh and eighth wells of our 15 well second half program. We continue to expect five of the 15 wells to be producing by December 31, with the remaining 10 wells coming on production early in the first quarter of 2019.

Our single, second half 2018 Deep Basin well was rig released on July 28 and fracked in early-August. Drilling and completion costs came in on budget and strong production rates came online in late August. The well averaged 1,430 boe per day over the first 30 days of production, with liquids ratios better than expected at approximately 85 bbls/mmcf (approximately 490 bbl/d), of which 55 bbls/mmcf (approximately 325 bbl/d) is free condensate.

In Peace River, we are currently drilling the fourth well of our four well second half program. We have averaged 8 legs per well and reservoir characteristics look strong with good oil shows. Oil production from the first two well pad is expected to come online within the next week, and the next two well pad is scheduled to come online in mid-November. The Peace River joint industry gas gathering system and gas plant was on-stream in advance of the September 30, 2018 Alberta Energy Regulator Directive-84 regulatory deadline. Current plant throughput is approximately 3,500 mcf per day net to Obsidian Energy.

Third Quarter Results and 2019 Budget to be Announced November 8, 2018

Obsidian Energy is expected to release its third quarter 2018 financial and operating results and 2019 Budget on November 8, 2018 before markets open in North America.  In addition, the third quarter management’s discussion and analysis and the unaudited consolidated financial statements will be available on our website at www.obsidianenergy.com, on SEDAR at www.sedar.com, and on EDGAR at www.sec.gov in due course.

There will be no conference call accompanying the quarterly release as management will be giving a comprehensive presentation via webcast during Investor Day the following week.

Investor Day to be Held November 15, 2018

The presentation will begin at 9:00 am Mountain Time (11:00 am Eastern Time) and will offer the investment community a comprehensive technical overview of our current operations, long term development potential and corporate strategy. The event will be held in Calgary for analysts and sales representatives and simultaneously webcast for the broader investment community. Webcast details will be announced with our third quarter results expected to be disseminated on November 8, 2018.

Obsidian Energy shares are listed on both the Toronto Stock Exchange under the symbol “OBE” and the New York Stock Exchange under the symbol “OBE.BC”.