Calgary, Alberta-based Advantage Energy Ltd. has begun strategic production curtailments of up to 130 million cubic feet per day of dry gas “in response to unusually low Alberta natural gas prices”.
Curtailments began in September and are planned to continue for the fourth quarter until pricing recovers, Advantage said in a news release. The production curtailment levels are adjusted on a continuous basis “to eliminate variable cash costs and defer development capital”.
Advantage said that the curtailments are primarily dry gas at the Glacier gas plant in northwest Alberta, near the provincial border with British Columbia. Glacier is among the lowest-cost natural gas assets in North America, and will not materially impact the company’s cash flow, it said.
Liquids production, which is currently exceeding expectations, will be unaffected, the company noted.
Production in the third quarter was approximately 74,000 barrels of oil equivalent per day, consisting of 368 MMcfpd of natural gas, 8,100 barrels per day of crude oil, and 4,600 bpd of natural gas liquids, including the impact of curtailments which averaged over 5,000 boepd.
Depending on the duration of gas price volatility and associated curtailments, 2024 production is expected to be approximately 70,000 boepd, the company said. Its outlook for 2025 production and capital remains unchanged.
“Capital discipline will remain an acute focus for Advantage. However, gas market fundamentals appear robust in 2025 as global demand for clean, reliable natural gas continues to rise. Together with our diversified market exposure and strategic hedging program, Advantage is well positioned for distinctive per-share growth and free cash flow as the natural gas market rebalances,” the company said. (October 15, 2024, Source: https://www.rigzone.com/news/advantage_energy_starts_dry_gas_production_cuts-15-oct-2024-178422-article/)
CANADA - Natural Gas - Production