Twin Butte Energy Ltd. (TSX: TBE) is pleased to announce that the Board of Directors have approved a 67 percent increase in the 2008 Capital budget to $45 million up from the previously announced $27 million.
Capital will be allocated to development opportunities in the Provost, Bulwark, Jayar and NE British Columbia core areas, and to high impact exploratory opportunities in the Brassey and Kelly areas of NE British Columbia.
Consistent operational performance, the impact of successful acquisitions and recent high impact farmins have created a significant inventory of opportunities and a solid production base for the Company. This platform combined with recent commodity price increases allows for an expanded budget within Twin Butte's current cash flow. Fourth quarter annualized cash flow is projected to be $56 million against year end net debt of approximately $48 million giving an estimated 2008 exit debt to Q4 annualized cash flow ratio of less than one, maintaining the Company's excellent financial position.
The increased capital spending will result in an upward revision to the Company's 2008 exit production rate to more than 3,650 boe/d up from management's previously estimated exit rate of more than 3,300 boe/d.
Approximately $12 million of the capital increase will be allocated towards the drilling of earning wells on the high impact Montney resource play at Brassey and Kelly and to facilities projects. These projects establish the Company in a resource play land base that represents a significant growth opportunity to Twin Butte and a high impact exploration portfolio on a go forward basis. The remaining $6.0 million is allocated to development opportunities focused on lower risk production and cash flow additions. -- www.cnxmarketlink.com
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