Terra Energy Corp. (TO: TT.TO) detailed the plan for its 2014 capex budget on Feb. 14. The initial capex amount is CA$14.3 million, the company said.
Pipeline projects for existing wells, in addition to oil and natural gas plays—including the Stoddart and Red Creek light oil plays in British Columbia—will take most of the year’s capex, the company said.
The capex is designed to reverse the past two years’ declining production trend and to “develop a platform for growth, Terra Energy said.
The capex plan will be funded from operations cash flow, the company said. This cash flow is estimated at roughly $20.8 million, based on an estimated natural gas price of $3.81 per thousand cubic feet (Mcf) for the year, the company said.
Cash flow is also estimated at $20.8 due to an estimated oil price of $86.27 per barrel, as well as an average production rate of 4,470 barrels of oil equivalent per day (BOE/d) for the year, the company added.
Terra’s target production exit rate for year-end 2014 is 4,900 BOE/d, split between approximately 39% oil and liquids and 61% natural gas, the company said.
Terra Energy explores, develops and produces natural gas and oil in western Canada.
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