CALGARY, Alberta, July 08, 2019 (GLOBE NEWSWIRE) — InPlay Oil Corp. (TSX: IPO) (OTCQX: IPOOF) (“InPlay” or the “Company”) is pleased to provide an operations update and announce that the annual review of its operating and syndicated credit facilities by its lenders has been completed.
Production for the second quarter, based on field estimates, is expected to average over 5,100 boed. The Company is very pleased with this result as it is above the high end of our annual production guidance of 4,900 – 5,100 boed, and achieved despite significant third party infrastructure turn arounds and downtime encountered during the quarter. The last two Willesden Green 1.5 mile Extended Reach Horizontal (“ERH”) wells that were drilled and brought on production in March 2019 have delivered some of our strongest production rates to date. The two ERH wells are flowing (without artificial lift) at the following initial production (“IP”) rates:
- Average IP-30 days of 891 boed (83% light oil and liquids)
- Average IP-60 days of 817 boed (79% light oil and liquids)
- Average IP-90 days of 668 boed (73% light oil and liquids)
Our strong balance sheet, coupled with low second quarter industry activity in Canada, provided InPlay access to preferred equipment as the Company elected in June to commence drilling the next two 1.5 mile ERH wells directly offsetting the last two wells brought on in March. These two wells, originally scheduled to commence drilling in the third quarter, were drilled in 9.0 and 9.2 days respectively continuing our industry pacesetting times for 1.5 mile ERH wells, but more importantly achieving new low costs of less than $1.4 mm on the drilling operations per well. These two wells are planned to be completed and brought on production later in July. In addition, as per our guidance, InPlay anticipates drilling and completing another four net horizontal wells prior to year-end. With strong production results year to date and an active second half drilling program, InPlay is well positioned to achieve its annual production guidance.
InPlay’s borrowing base has been reconfirmed by its lenders at $75 million, comprised of a $65 million revolving line of credit and a $10 million operating line of credit, with the term out dates being extended to May 31, 2020. In conjunction with the customary annual review, the terms of the credit facilities have been amended to include newly required industry standard banking compliance and reporting features related to abandonment and reclamation activities and liability management ratings. As well, a provision has been put in place until the next semi-annual review on November 30, 2019 in which the borrowing base may be re-determined if requested by any lender in the event the outstanding principal under the credit facilities exceeds $60 million. The Company believes that this credit facility provides ample liquidity for InPlay to execute its stated 2019 capital program. The Company has never been drawn in excess of $60 million on our credit facilities and our expectations with our current 2019 program is that capital spending should not exceed expected funds flow from operations based on future commodity pricing while also still delivering top tier light oil growth amongst our oil weighted peers.
InPlay is based in Calgary, Alberta and the common shares of InPlay are traded on The Toronto Stock Exchange under the trading symbol “IPO”. For further information about the Company, please visit our website at www.inplayoil.com.