Hammerhead increases 2023 production guidance
Hammerhead Energy Inc., Calgary, has increased its 2023 annual average production guidance based on costs and performance, the company said in a release Sept. 6.
Annual average production for the year is now guided to 41,500 boe/d from the previous estimate of 40,200 boed. Crude oil production is estimated to be 35% of production from a prior estimate of 33%.
Since the start of production Aug. 6, performance on the 12-well North Karr 10-14 pad in Alberta has exceeded the company’s internal forecast, with peak pad production surpassing 17,800 boe/d (over 50% crude oil). Field estimates of Hammerhead’s corporate production volumes for August averaged 48,500 boe/d, with upside as North Karr total production capability exceeds infrastructure capacity, the company said.
Overall, well performance has exceeded type curves while capital costs have come in lower than forecast. Thus, Hammerhead is reducing its 2023 capital expenditures guidance to $500 million from $525 million.
Updated 2023 production guidance continues to assume that the new South Karr 5-11 nine-well pad does not begin production until January 2024, although drilling operations have been completed ahead of planned timing while expansion of infrastructure at South Karr is still expected to be completed before the end of 2024, the company said.
In February, Hammerhead Resources Inc. was renamed Hammerhead Energy Inc. following a business combination with special purpose acquisition company Decarbonization Plus Acquisition Corp. IV.
The oil and gas exploration and production company is developing a 107,000 net acre resource base within the Montney light oil window in Alberta. It holds an undeveloped inventory of over 1,500 gross well locations targeting the Upper and Lower Montney within its core development areas of Gold Creek, South Karr, and North Karr near Grande Prairie, Alta.
