Total field production is currently over 750 boepd and has exceeded this rate since the second week of March. Importantly, production from the Company's newest CHOPS ("Cold Heavy Oil Production with Sand") oil wells continues to increase and the Company's total oil production is currently over 400 bopd.
Due primarily to additional production from the new CHOPS wells, average production, revenue and cash flow for the quarter ended March 31 is expected to be significantly higher than the previous quarter.
The increased CHOPS production is a result of a number of factors, including:
- Continued production increases over time from new wells. CHOPS wells typically exhibit a period of increasing production over the first year (compared to an unconventional well that will often experience significant declines in its first few years of production);
- Completion of a tie-in allowing one of the Company's oil wells to produce the associated natural gas without restricting its overall production rate; and
- Continued, improved production from the well that had previously been affected by a cementing issue.
Total revenues and associated cash flows have increased materially compared to the previously published quarter. Revenues from February's production exceeded CDN$1 million. This is the highest monthly revenue the Company has achieved since inception and the Company expects to exceed February revenues in March.
Brad Nichol, President and CEO of Edge commented, "We are on track for another excellent quarter. In addition to production increases, revenue and cash flow have also significantly improved. Our first million dollar revenue month in February was a major milestone for the Company and is a record we hope to break immediately in March." Nichol added, "Since mid-January, we have seen a material turnaround in both commodity pricing and heavy oil differentials, which coincided perfectly with the onset of new production from our latest CHOPS producers. Edge is currently enjoying strong cash flow that should allow us to continue to reduce debt and build up our cash resources to fund future drilling. We also look forward to seeing improved year-end reserves associated with the highly successful drilling program."