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Obsidian Energy Reports Strong Production and Reserves Growth in 2023

Obsidian Energy, an oil and gas company based in Calgary, Alberta, has announced the results of its independent reserves evaluation for the year ended December 31, 2023. The company’s reserves showed significant growth across all categories and asset areas, reflecting the success of its capital program.

“We are pleased with the performance of our underlying assets and the results of our capital program,” said Stephen Loukas, Obsidian Energy’s President and CEO. “We have seen volume increases across all categories and asset areas, and our reserve additions have more than replaced production for the seventh consecutive year.”

The company reported reserve replacements of 124 percent on a proved developed producing (PDP) basis, 157 percent on a total proved (1P) basis, and 217 percent on a total proved plus probable (2P) basis. These strong reserve replacement ratios demonstrate the company’s ability to efficiently replace its produced reserves.

Despite lower commodity prices in 2023, Obsidian Energy’s capital program showcased its efficiency, with lower finding and development costs per barrel of oil equivalent (boe) compared to the previous year. This resulted in strong recycle ratios, which measure the profitability of the company’s assets based on its expected operating netback and F&D costs.

The company also highlighted improvements in both finding, development, and acquisition (FD&A) costs, as well as decline rates. FD&A costs, including changes in future development capital, were $19.35/boe for PDP, $22.42/boe for 1P, and $18.37/boe for 2P. The total corporate decline rate improved to 21 percent on a PDP basis, indicating the stability of Obsidian Energy’s reserve base.

Obsidian Energy’s reserve report also revealed an increase in undeveloped reserve locations, particularly in the Cardium and Peace River areas. The company plans to further appraise and develop these assets in the coming years, adding to its reserve base.

Overall, the 2023 reserves evaluation highlights Obsidian Energy’s strong production and reserves growth, as well as its commitment to efficient operations and asset development. The company remains optimistic about its future prospects and its ability to deliver value to its shareholders.

Obsidian Energy Reserve Evaluation FAQ

1. What are the main findings of Obsidian Energy’s independent reserves evaluation for the year ended December 31, 2023?
– Obsidian Energy’s reserves showed significant growth across all categories and asset areas.
– Volume increases were seen across all categories and asset areas.
– Reserve additions have more than replaced production for the seventh consecutive year.

2. What were the reserve replacement ratios reported by Obsidian Energy?
– Reserve replacements were 124% on a proved developed producing (PDP) basis.
– Reserve replacements were 157% on a total proved (1P) basis.
– Reserve replacements were 217% on a total proved plus probable (2P) basis.

3. How did Obsidian Energy’s capital program showcase efficiency?
– Despite lower commodity prices, Obsidian Energy had lower finding and development costs per barrel of oil equivalent (boe) compared to the previous year.
– The efficiency resulted in strong recycle ratios, which measure the profitability of the company’s assets.

4. What were the finding, development, and acquisition (FD&A) costs reported by Obsidian Energy?
– FD&A costs were $19.35/boe for PDP.
– FD&A costs were $22.42/boe for 1P.
– FD&A costs were $18.37/boe for 2P.

5. What improvements were highlighted in Obsidian Energy’s reserve report?
– Improvements were seen in finding, development, and acquisition (FD&A) costs.
– Decline rates decreased.
– The total corporate decline rate improved to 21% on a PDP basis.

6. Which areas showed an increase in undeveloped reserve locations for Obsidian Energy?
– The Cardium and Peace River areas showed an increase in undeveloped reserve locations.

7. What are Obsidian Energy’s future plans regarding these assets?
– Obsidian Energy plans to further appraise and develop these assets in the coming years, adding to its reserve base.

Key Terms and Definitions:
– Independent reserves evaluation: An assessment of an oil and gas company’s oil and gas reserves conducted by an independent third party.
– Reserve replacements: The ability of a company to replace its produced reserves with new reserves.
– Finding, development, and acquisition (FD&A) costs: The costs associated with finding, developing, and acquiring oil and gas reserves.
– Recycle ratios: A measure of the profitability of a company’s assets based on its expected operating netback and F&D costs.
– Undeveloped reserve locations: Areas where oil and gas reserves exist but have not yet been developed for production.
– Cardium and Peace River areas: Specific geographical areas where Obsidian Energy has found increased undeveloped reserve locations.

Related Links:
Obsidian Energy Official Website

By Alan Caldwell

Alan Caldwell is a respected authority and prolific writer on the subject of urban renewable energy systems in American cities. His expertise lies in exploring the implementation and impact of green energy solutions, such as solar and wind power, in urban landscapes. Caldwell's work often highlights the challenges and successes of integrating renewable energy into city grids, advocating for environmentally sustainable and economically viable energy strategies. His insightful analyses and recommendations have been influential in shaping how cities approach their transition to cleaner energy sources, contributing significantly to the discourse on sustainable urban development.