CALGARY, June 12, 2012 /CNW/ - Enerplus Corporation
("Enerplus") (TSX: ERF) (NYSE: ERF) today reiterated production
growth targets for 2012. We continue to expect to deliver 10%
organic production growth through a capital spending program
designed to increase crude oil production significantly throughout
the year and preserve the value of our core natural gas assets for
the future.
Approximately 70% of our forecasted $800
million capital spending in 2012 is weighted to crude oil
and natural gas liquids projects. Approximately 40% of this
capital is being directed to our light crude oil assets in the
North Dakota region where
production is expected to double by year end. We will continue to
invest with our partners in the Marcellus shale gas play, which we
believe is one of the best natural gas plays in North America. Our focus is to preserve our
lease interests and retain the value of this significant asset for
the future.
We continue to pursue the monetization or joint venture of a
portion of our strategic undeveloped land base. Over the past
three years, we have amassed over 170,000 net acres of strategic
land in the Montney and
Duvernay as well as our operated
acreage in the Marcellus that contains significant future drilling
potential. Along with the sale of our equity portfolio,
we expect that we could generate $250 - $500
million of proceeds over the next 12 - 18 months that will
help fund our future growth strategies.
Despite our operational success year-to-date, commodity prices
have weakened and resulted in lower forecast cash flows.
While our balance sheet is currently strong and we have significant
liquidity with respect to our credit capacity, we are reducing our
monthly dividend from CDN$0.18 per
share to CDN$0.09 per share. We
believe this reduction will strike a better balance between yield
and growth, allowing continued investment into our asset base in a
more sustainable manner. We remain committed to a strategy that
provides investors with a dividend and growth investment.
As stated, the new dividend amount of CDN$0.09 per share will be effective with the
July payment and will not impact the dividend payable on
June 20, 2012.
Gordon J. Kerr
President & Chief Executive Officer
Enerplus Corporation
Currency, BOE and Operational Information
All dollar amounts or references to "$" in this news release are
in Canadian dollars unless specified otherwise. Enerplus has
adopted the standard of 6 Mcf:1 BOE when converting natural gas to
BOEs. BOEs may be misleading particularly if used in isolation. A
BOE conversion ratio of 6 Mcf:1 BOE is based on an energy
equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.
Given that the value ratio based on the current price of crude oil
as compared to natural gas is significantly different from the
energy equivalency of 6:1, utilizing a conversion on a 6:1 basis
may be misleading as an indication of value. Unless otherwise
stated, all oil and gas production information and estimates are
presented on a gross basis, before deducting royalty interests.
Cautionary Note Regarding Forward-Looking Information and
Statements
This news release contains certain forward-looking information
and statements (collectively, "forward-looking information") within
the meaning of applicable securities laws. The use of any of the
words "expect", "anticipate", "continue", "estimate", "budget",
"guidance", "objective", "ongoing", "may", "will", "project",
"should", "believe", "plans", "intends", "strategy" and similar
expressions are intended to identify forward-looking information.
In particular, but without limiting the foregoing, this news
release contains forward-looking information and statements
pertaining to the following: future capital spending amounts
(including capital carry commitments), the timing and locations of
such spending and the types of projects on which such capital will
be spent; future growth in production, reserves and cash flow and
other anticipated growth opportunities; a financing strategy to
fund anticipated capital expenditures, future oil, natural gas
liquids and natural gas prices and production levels (including
anticipated 2012 average daily and exit production rates), the
product mix and sources of such production, and production decline
rates; future drilling activities and results and undeveloped land
acquisitions; future capital efficiencies, corporate netbacks and
cash flow levels; rates of return from our investments; the
expected ultimate recovery of oil or gas from a particular well;
well drilling costs, operating costs, general and administrative
expenses and royalty expenses; sales of our equity portfolio and
our non-core properties and the redeployment of proceeds realized
therefrom; dividend payments made by Enerplus and the related
adjusted payout ratio; the timing and payment of future taxes; our
planned commodity risk management program; and future liquidity,
debt levels and financial capacity and resources.
The forward-looking information contained in this news release
reflect several material factors and expectations and assumptions
of Enerplus including, without limitation: that Enerplus will
achieve operational, production and drilling results as
anticipated; anticipated production decline rates; the general
continuance of current or, where applicable, assumed industry
conditions; commodity prices will remain within Enerplus' expected
range of forecast prices, being the current forward market prices;
availability of adequate cash flow, debt and/or equity sources to
fund Enerplus' capital and operating requirements as needed and to
pay dividends to shareholders as anticipated; the continuance of
existing and, in certain circumstances, proposed tax and royalty
regimes; availability of willing buyers for the investments and
properties proposed to be disposed of; that capital, operating,
financing and third party service provider costs will not exceed
Enerplus' current expectations; availability of third party service
providers (including drilling rigs and service crews) and
cooperation of industry partners; certain foreign exchange rate and
other cost assumptions; and that all conditions and approvals
necessary to complete anticipated financing activities will be
satisfied or obtained. Enerplus believes the material factors,
expectations and assumptions reflected in the forward-looking
information are reasonable at this time but no assurance can be
given that these factors, expectations and assumptions will prove
to be correct.
The forward-looking information included in this news release is
not a guarantee of future performance and should not be unduly
relied upon. Such information involves known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking information including, without limitation: changes
in commodity prices; unanticipated operating or drilling results or
production declines; potential redeployment of available funding to
alternative projects; changes in tax or environmental laws or
royalty rates; failure to receive required regulatory or third
party approvals or to satisfy conditions required for financings;
increased debt levels or debt service requirements; insufficient
available cash to pay dividends as currently anticipated;
inaccurate estimation of or changes to estimates of Enerplus' oil
and gas reserve and resource volumes and the assumptions relating
thereto; limited, unfavourable or no access to debt or equity
capital markets; increased costs and expenses; a shortage of third
party service providers; the impact of competitors; reliance on
industry partners; an inability to agree to terms with potential
buyers of investments or assets that may be disposed of; and
certain other risks detailed from time to time in Enerplus' public
disclosure documents including, without limitation, those risks
identified in our MD&A for the year ended December 31, 2011 and in Enerplus' Annual
Information Form dated March 9, 2012
for the year ended December 31, 2011,
copies of which are available on Enerplus' SEDAR profile at
www.sedar.com and which also form part of Enerplus' annual report
on Form 40-F for the year ended December 31,
2011 filed with the United
States Securities and Exchange Commission, a copy of which
is available at www.sec.gov.
The forward-looking information contained in this news release
speaks only as of the date of this news release, and Enerplus
assumes no obligation to publicly update or revise such information
to reflect new events or circumstances, except as may be required
pursuant to applicable laws.
Any financial outlook or future oriented financial information
in this news release, as defined by applicable securities
legislation, has been approved by management of Enerplus. Such
financial outlook or future oriented financial information is
provided for the purpose of providing information about
management's reasonable expectations as to the anticipated results
of its proposed business activities for 2012. Readers are cautioned
that reliance on such information may not be appropriate for other
purposes.
SOURCE Enerplus Corporation