Latest / Financial Survival Network / Prospera Energy December Oil Production Set to Hit Post-Restructure High with CEO Samuel David

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Prospera Energy December Oil Production Set to Hit Post-Restructure High with CEO Samuel David · Financial Survival Network

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  Twenty twenty two, MPB was valued at seventy two million dollars. Since then,
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  we're adding nearly thousand bus to day ten horizontals and Brooks development. It
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  should have some reasonably significant impact on the reserve evaluation of the company and the
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  NPB of the two p MPB of the company. The Financial Survival Network now
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  more than network, the Financial Survival Network. Welcome. This is Financial Survival
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  Network. I'm your host, Kerrie Lutz. And hey, we're in the
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  first week of December. We're getting an update from Prospera, you know,
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  one of my largest holdings websites prosper Energy dot com, the symbols and the
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  US g xr FF and in Canada of course Pei. Right now with me
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  is CEO Samuel David and CFO Chris Ludkey. Gentlemen, I know it's snowing
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  on this Friday, but you guys from our neighbors up north, nothing you're
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  not used to. Actually, it's uh. First of all, I carry
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  already doing. First of all, I think it's nice having some snowflakes on
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  the ground. It gives us that Christmas feeling in spirit. It's its this
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  this season, so so and last winter though, we didn't get that Christmas
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  feeling because effectively the weather was so bad and due to circumstances you weren't prepared
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  for, you know, field shut down. But this winter is going to
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  be a different story, isn't it. It keeps us on our toes all
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  the time, that's for sure. That's Canadian weather, Calgary weather for you.
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  So, so Sam, can you give us a production update as of
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  now where we stand. Certainly, as you know, we're continue to do
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  our horizontal transformation and the rig is drilling I think it's drilling the eighth horizontal
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  right now. And while we're drilling, as I mentioned before, we shut
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  off all the adjacent production and because it's a very poorest permeable sand, we
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  actually shut down the entire pool for production. So there's about four hundred somewhat
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  barrels that's shut in for the drilling, and also the new horizontals that we
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  drilled also has to be shut in for the adjacent adjacent production. Adjacent horizontals
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  that we're drilled is also shut in and they're all being to come on as
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  we're getting to the near end of our drilling in that location. So there's
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  about closer to six hundred seven hundred barrels per day bueis per day shut in.
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  Our production currently is about thousand bue's mostly barrels. It's thousand barrels a
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  day, and we have all six hundred hundred barrels shut in. We're also
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  bringing on Brooks at the moment. As a matter of fact, as we
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  speak, we've finished our first well. We have prifted did our as a
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  job and it looks as expected might exceed their expectation. We're also tying in
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  another well in Brooks as well, so all that leads to that we are
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  getting more and more confident. We exit as anticipated at the production rate of
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  eighteen hundred bu week a day and could theoretically be higher as far as the
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  flow rates. So these new horizontal wells, last time we spoke, you
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  mentioned that it exceeded your initial forecast. Is that still holding true? Pleasantly,
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  The pumps are operating at its lowest speed and efficiency because we don't want
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  to exert a huge draw on the reservoir and it's been holding the water cut
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  mostly it's a ninety nine percent oil cut, and now we're beinging to optimize
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  more. The indication is we are draining undrained reserves that were tapped in by
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  the ridicule wells, and that gives the fair amount of confident on the oil
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  in place and a significant reserve add to the year end reserve evaluation. Consequently,
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  the NPV value of the company twenty twenty two in PB was valued at
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  seventy two million dollars. Since then we're adding nearly thousand bus a day,
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  ten horizontals and brooks development. It should have some reasonably significant impact on the
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  reserve evaluation of the company and the NPB of the two p mpve of the
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  county. If my memory sertas make correct, you're getting over one hundred barrels
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  per horizontal well that you're drilling. Is that number I showed in the chart
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  there anything over around five hundred meters of latter pay we were getting hundred,
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  one hundred and ten barrels per day well. It makes my limited potential for
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  math a lot easier because however many wells you eventually drill, I just multiplied
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  times one hundred, and I get your expected to flow rate there, right.
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  I certainly hope to maintain that about those results. So press as far
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  as Pei's financials go before Zam mentioned or you mentioned break even of somewhere around
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  five hundred barrels per day. You're keeping a lid on cost. Is that
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  pretty consistent? Yeah, certainly carry and you know with the press have falling
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  off a little bit since I think we were lost on the show. You
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  know, we see break even maybe around six hundred barrels a day gross this
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  ten seconds with seventy seventy five dollars WTI and the heavy delaight oil differential where
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  it sits currently. However, with the additional volume coming online through the end
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  of the year, we're obviously seeing our fixed costs reduced on a per barrel
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  basis, and so that number is coming down with the additional barrels that we're
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  producing. So happy to see the increases here, which means your margin's going
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  up and your netback goes up. Right, Yeah, that's correct, Yeah,
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  all right. And as far as the drill program going ahead, for
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  however many wills eventually get drilled, company is going to be able to pay
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  for this, that's right, Yeah, that's right. So we've we're finance
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  to be able to execute the rest of the horizontal program we recently announced some
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  news earlier on where we talked about debt and gore financing roughly about three and
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  a half million dollars. All of those proceeds are going directly into the ground
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  to be able to support the drilling program. All right, So from last
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  year twenty twenty two to the end of twenty twenty three, can you just
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  contrast the financial position of the company now as opposed to a year ago.
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  Yeah, certainly. I mean, I think we've seen a lot of our
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  legacy debt being paid off, so we've seen reductions across the board with some
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  of the payables that were inherent when there was a change over from the old
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  management team, we're seeing we've seen the end of some of those payment plans.
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  So we made our final payments in November for some of the twenty four
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  month payment plans that we worked on with vendors. But I think overall,
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  Kerry, the company is poised really to start to move ahead based on these
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  incremental barrels and the additional cost flow that the debt's associated with it. That's
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  always good news. So, Sam, we last spoke, you mentioned that
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  cost drilling cost per Well, we're coming in fifteen percent below your expectations.
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  Is that still running consistent with that in a perudit basis, because, as
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  I mentioned, the lateral five hundred meters plus as giving us ip in one
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  hundred plus barrels per day. So the next group of wells that we have
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  commenced, we're targeting around six hundred meters and seven hundred meters of lateral pay.
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  Technically we can extendard laterals to those length and the first one we drilled,
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  I think it was five hundred and forty or something plus the second one
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  now we're in a six hundred meters plus. So the costs is corresponding to
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  the time. But you know, the savings has been under budget so far.
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  Yes, borrowing from any technical challenge that we might incur, which which
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  which always happens, because it's not just you know, cheese that you're cutting
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  through. It's there's heterogeneity in the reservoir and there's different things to be encounter
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  and that's fine. You know, I would say it's an efficient operation,
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  right, So effectively, based on the numbers you mentioned last time, it's
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  almost as if every seventh well you drill is for free. Well, I
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  suppose you can look at it that way. Yes, right, so hey,
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  acquisitions, we've heard mention of them. I realize you can't get too
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  deeply in the weeds here for obvious reasons, but they're moving ahead that part
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  of our business strategy. I'm getting more and more excited about it because as
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  we have gone into our development program and then our horizontal transformation, we've done
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  a number of wells now and now you could say it's repeatability and the same
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  thing with the light oil development. We have encountered pay initial production tests as
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  anticipated, so that horizontal development plan is proceeding according to the plan, and
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  now we are able to focus on the other development to appreciate prosper through acquisitions.
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  So now I get to spend a little bit more time in accelerating these
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  acquisitions. There's one other point that I must add that allows me to do
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  this. We hired a very experienced individual that has a lot of working knowledge
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  in this area as VP of Operations, John McMahon, and this allows me
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  to free myself a little bit from our hands on operation to focus on an
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  acquisition. As as a result, we have about five acquisitions in play right
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  now. The corporate strategy that we have that we try to hit properties that
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  are in distress and it's in primary depletion and it hasn't been totally optimized.
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  And we look for light oil to complement our heavy oil dependency, and there's
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  a number of them. They're all moving ahead, and I'm really hoping and
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  pushing to complete all of that for quarter one. They're they're going into OI
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  and it's because now now I have some uh, there's some time I can
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  focus on this and things are moving ahead, and I think I don't know
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  if I'd be brave enough to mention, but you know, there's US acquisitions
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  involved because there if we see some synergy. So this is the first time
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  I'm alluding to something like that. It's not to change the focus, but
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  the US audience are very aware of Prospero Energy and we've been we've been getting
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  fair line interest in Prospera to combine with Prospera. So there's a number of
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  things that's moving ahead carry and I think I can expand a little bit more
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  in that latter part of January. Excellent excellent news. Well, I guess
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  there's two places to drill for boil. One is in the fields and the
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  others in the financial markets. And if you can get a good deal on
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  it, why not. So, Chris, these acquisitions that Sam's alluding to,
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  they would be accreative in nature. They wouldn't be diluted with it.
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  Oh no, certainly a creative. I mean what we're looking at here is
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  each and every one of the acquisitions that Sam mentioned are roughly about ten thousand
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  per flowing barrel to be able to add to Prospera. And you know,
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  some of the peers that we spire to look like and even there, you
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  know, in the future here all very valued in the thirty to forty thousand
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  dollars per fol flowing barrel. So you can see the you know, three
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  or four times upside just just on that basic math. So really, I
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  would almost liken the Prospera to the potential of a roll up to be able
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  to take all these undervalued barrels, bring them into Prospera, and then revalue
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  them at a higher flowing barrels. Correct. Yeah, Yeah, And that's
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  that's what our team is set up to be able to do, is to
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  be able to take these distressed assets, these undervalued assets, and be able
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  to recognize the true value behind them. But you know, that's not the
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  only way we'd like to appreciate just and it doesn't make sense, you know,
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  just revalue them. But we're not going to just do that. We
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  are looking at these properties because we know there's reserves and we can optimize them.
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  So we will supplement and support it with whatever barrels it came. We
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  will optimize that barrels one to one or more, you know, and then
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  we'll get into reservoir mannauncement. So I think the appreciation and production will foster
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  the reevaluation, right, Yeah, So it's not just a question of taking
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  the asset putting it on the books. It's adding value to it at the
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  very same time by increasing your flow rate, increasing recoveries, and cutting costs
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  as well. I would presume producing our cost environmental footprint, you know,
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  applying latest technology and some good reservoir management that most companies are most reservoir has
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  not been applied to all Right, Well, I think we got a really
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  good insight into what's going on with the company. Now it's moving forward.
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  You know, this time of year, things kind of feel like they grind
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  to a halt or they slow down. But it sounds like in Prospero's case,
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  that's hardly the case. So again, go to the website, sign
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  up for notifications prosperit Energy dot com, ticker symbols us g x r FF
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  and in Canada of course Pei. Gentlemen, best wishes for the holiday season.
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  We'll touch base after the first of the year. Thanks so much,
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  thank you, and Prospera wishes all the shareholders and stakeholders and everyone that's interested
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  in Prospera a very very safe merry Christmas and happy holidays. All right,
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  thank you, all right, take care, Thank you, Gerrit. We'll
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  talk to you soon. The Financial Survival Network