04:16:32 EDT Fri 29 Mar 2024
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Pengrowth Energy Corp
Symbol PGF
Shares Issued 547,443,255
Close 2016-05-30 C$ 2.25
Market Cap C$ 1,231,747,324
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Pengrowth given green light for phase 2 of Lindbergh

2016-05-30 19:22 ET - News Release

Mr. Derek Evans reports

PENGROWTH RECEIVES REGULATORY APPROVAL FOR THE 17,500 BARREL PER DAY SECOND COMMERCIAL PHASE OF THE LINDBERGH THERMAL PROJECT

Pengrowth Energy Corp. has received the anticipated Environmental Protection and Enhancement Act (EPEA) approval for the 17,500-barrel-per-day second commercial phase of its Lindbergh thermal project. The approval contains no conditions that materially change the estimated cost, scope or timing of the project. This approval marks the culmination of approximately 30 months of project review by stakeholders and regulators.

The second commercial phase is designed to add 17,500 barrels per day of incremental capacity, resulting in total nameplate capacity from Lindbergh of 30,000 barrels per day at a steam-oil ratio (SOR) of 3.6, once the expansion phase is complete. Capital cost estimates and commitments for the second phase have not been finalized and will likely not be pursued until market conditions are more supportive of these activities.

Lindbergh, Pengrowth's wholly owned and operated thermal project, is located in the Cold Lake area of eastern Alberta. The project offers Pengrowth the potential to ultimately develop annual production of 40,000 to 50,000 barrels per day, starting with the 12,500-barrel-per-day nameplate capacity of the first commercial phase, which came on stream in 2015.

Production from the first commercial phase has continued to ramp up, averaging 15,256 barrels per day in the first quarter of 2016 at an average SOR of 2.3. The original two pilot well pairs have been on production for over 48 months and have recovered approximately 2.3 million barrels of the 2.4 million barrels that were originally estimated to be recovered. Performance from the pilot wells continues to be robust, with the current combined production rate from the two well pairs being approximately 1,300 barrels per day at an average SOR of 3.3.

"We are delighted to have received final regulatory approval for the second commercial phase at Lindbergh, which, to date, has been among the best-performing thermal bitumen projects in Western Canada," said Derek Evans, president and chief executive officer of Pengrowth. "This expansion will be part of our transition to building a portfolio of highly economic thermal oil assets with low SORs, low declines, low sustaining capital and strong capital efficiencies -- the hallmarks of long-term sustainability."

We seek Safe Harbor.

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