Athabasca Oil Corporation Provides 2021 Budget Guidance and Announces Bank Facility Renewal along with an Increase in Unsecured Credit Facility Capacity

CALGARY, Alberta, Dec. 02, 2020 (GLOBE NEWSWIRE) -- Athabasca Oil Corporation (TSX: ATH) (“Athabasca” or “the Company”) announces its 2021 budget that is focused on maintaining base production and maximizing funds flow. The Company also is pleased to announce that it has renewed its syndicated bank facility and has received an increase to its unsecured letter of credit facility backstopped by Export Development Canada.

2021 Budget

Low Sustaining Capital. Athabasca is planning expenditures of $75 million focused on sustaining projects at Leismer along with routine maintenance activities at all properties. Capital will be allocated $70 million to Thermal Oil and the remainder to Light Oil.

Resilient Production. Annual corporate production of 31,000 – 33,000 boe/d (90% liquids) which maintains annual 2020 production estimated to average approximately 32,250 boe/d.  

Thermal Oil Activity. At Leismer, two infill wells at Pad L6 and an additional well pair at Pad L7 will be drilled in early 2021. These wells will support production in H2 2021 with payouts within one year at current commodity prices. The Company will progress readiness (long lead items, lease site and road construction, pipeline access) for a 5 well-pair sustaining pad (L8) with the option to initiate drilling during this winter season. The sanctioning of capital to drill these wells will be determined at a later date and will depend on the commodity price environment and available liquidity. Hangingstone will have no capital allocation other than routine pump replacements. The Hangingstone project is expected to continue its production ramp up in 2021 following the five month shut-in over the summer this year in response to unprecedented oil price volatility. Hangingstone’s current production is approximately 7,500 bbl/d.   

Light Oil Activity. Minimal activities are planned with no new wells expected to be placed on-stream during the year. The assets continue to demonstrate top decile industry netbacks and will contribute significant cash flow to the Company. Future development opportunities are substantial, with approximately 150 well locations in Placid Montney and 700 well locations in Kaybob Duvernay. The land positions in these areas have minimal near term expiries and the capital program is flexible to adjust to commodity prices.