Jul. 20, 2011 (Canada NewsWire Group) --
/Not for Distribution to U.S. News Wire Services or Dissemination in the U.S./
CALGARY, July 20, 2011 /CNW/ - Novus Energy Inc. ("Novus" or the "Company") is pleased to announce that the Company is now halfway through its 2011 Viking oil drilling program, and has now successfully drilled 26 Viking oil wells in the Dodsland area of Saskatchewan, with 20 of these wells having been completed. Seventeen of the wells that have been completed have been placed on production, with the remainder to follow. Novus is pleased with the initial rates the first wells have demonstrated to date. Drilling and completion costs in the Dodsland area continue to meet the Company's budgeted figures of $850,000 per well. Novus expects to provide a further update in August, as more wells are completed, and more production data is collected.
With two drilling rigs running, Novus expects to drill a total of 52 net Viking oil wells in the Dodsland area by the end of the third quarter of 2011, and complete a total of 46 wells, assuming normal summer weather, by the end of September 2011. The remaining wells will be completed early in the fourth quarter of the year.
Total estimated field level corporate production as of July 18, 2011 was approximately 2,120 boe/d. Novus expects production will continue to steadily increase through the balance of the third quarter as additional wells are drilled and placed on production. The Company is comfortable that given the progression of its drilling plans and results to date, that it will meet its previously announced exit rate guidance of 3,000 boe/d. The Company's anticipated exit rate of 3,000 boe/d represents a near doubling of production from the 1,544 boe/d the Company reported in its first quarter of 2011.
Novus remains excited about its Flaxcombe sub area in the Dodsland region. The Company has determined that these previously undrilled lands are characterized by two distinct cycles in the Viking formation. In 2011, the Company has now drilled two horizontal wells targeting the lower cycle and one horizontal well targeting the upper formation. Virgin pressures realized on these wells were in excess of 7,500 KPa which are amongst the highest pressures the Company has recorded in any of its Viking wells drilled thus far. These three wells have now all been producing for in excess of 30 days, and have demonstrated estimated field level average production rates per well of 74 bbl/d for the last 30 day period. Novus has mapped over ten sections of its lands where both cycles are present and expects this area to significantly add to its existing drilling inventory of 592 net Viking oil locations, and reserves and production growth as development of the two distinct Viking cycles progresses. Production from the recently drilled wells has exceeded expectations, and is supportive of the longer term potential the Company believes the area exhibits.
The upgrades at Novus' owned and operated facilities at Whiteside and Avon Hills have now been completed. Gas production from the Whiteside area is currently being conserved with a number of additional pipelines being surveyed to handle new solution gas volumes from our current drilling program.
With recent land acquisitions in the Dodsland area, Novus now controls 115.25 net sections of Viking rights, and has identified 592 net Viking oil drilling locations.
Novus has recently acquired a 100% working interest in approximately 55 net sections of land with rights in the oil bearing Birdbear formation in the Dodsland area of Saskatchewan, which complements the 24 net sections of land with rights in this formation already owned by Novus.
Successful Birdbear oil wells in the area are amongst the most economic in Canada due to high deliverability rates, large oil reserves and low drilling and completion costs. The Company will be dedicating some of this year's capital expenditure program towards the shooting of 3D seismic and the potential drilling of a number of Birdbear locations.
Novus Energy Inc. is a well positioned, junior oil and gas company with a proven management team committed to aggressive, cost-effective growth of high netback light oil reserves and production. Novus will continue to grow through a targeted acquisition and consolidation strategy coupled with exploratory and development drilling.
Novus Shares trade on the TSX Venture Exchange under the symbol NVS. Novus currently has 170.1 million common shares outstanding.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release will not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. Such securities have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States, or to a U.S. person, absent registration, or an applicable exemption therefrom.
Advisory Regarding Forward Looking Statements
Certain disclosures set forth in this press release constitute forward-looking statements. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believes", "budget", "continue", "could", "estimate", "forecast", "intends", "may", "plan", "predicts", "projects", "should", "will" and other similar expressions. All estimates and statements that describe the Company's future, goals, or objectives, including Management's assessment of future plans and operations, may constitute forward-looking information under securities laws. Forward-looking statements involve known and unknown risks and uncertainties which include, but are not limited to: exploration, development and production risks; assessments of acquisitions; reserve measurements; availability of drilling equipment; access restrictions; permits and licenses; aboriginal claims; title defects; commodity prices; commodity markets, transportation and marketing of crude oil, liquids and natural gas; reliance on operators and key personnel; competition; corporate matters; funding requirements; access to credit and capital markets; market volatility; cost inflation; foreign exchange rates; general economic and industry conditions; environmental risks; Kyoto protocol; and government regulation and taxation.
Forward-looking statements relate to future events and/or performance and although considered reasonable by Novus at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated in the statements made. Novus does not undertake any obligation to publicly update forward-looking information except as required by applicable securities law.
Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Novus' operations or financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), and at Novus' website (www.novusenergy.ca). The forward-looking statements and information contained in this press release are made as of the date hereof and Novus undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
|NOVUS ENERGY INC.|
| Hugh G. Ross |
President and CEO
| Ketan Panchmatia |
Chief Financial Officer
| Julian Din |
VP Business Development