News

Pine Cliff's natural gas market diversification strategy was successful in generating positive adjusted funds flow in 2019, despite enduring one of the lowest AECO gas prices in 20 years. Pine Cliff was also able to use its extensive seismic database to expand the Company's prospect inventory by identifying a number of drilling locations on its existing land base and during the fourth quarter, drilled two 100% Pekisko oils wells.

Following up on the drilling of its initial horizontal oil well ("13-33") in the fourth quarter of 2018, Pine Cliff drilled two gross (2.0 net) Pekisko horizontal oil wells during the fourth quarter of 2019.

Pine Cliff's independent reserve report was prepared by McDaniel & Associates Limited ("McDaniel") in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101") with the effective date of December 31, 2019.

Pine Cliff's first horizontal oil well ("13-33") targeting the Pekisko formation in Central Alberta came on production on January 18, 2019, and has averaged 249 Boe/d (111 Bbl/d oil, 27 Bbl/d natural gas liquids and 666 Mcf/d natural gas) through the first 365 days of production.

The Company has appointed Alan MacDonald Chief Financial Officer and Corporate Secretary, effective December 4, 2019. Mr. MacDonald is a Chartered Accountant with over 30 years of experience in the oil and gas industry and held the position of Interim Chief Financial Officer and Corporate Secretary of Pine Cliff from September 2017 to September 2018 when Ms. Lowe was on maternity leave.

he third quarter of 2019 was a difficult quarter for natural gas producers with AECO 5A natural gas pricing averaged $0.90 per Mcf, the lowest quarterly average in decades. Even with Pine Cliff's low cost structure and access to diverse natural gas markets, the Company was unable to avoid negative adjusted funds flow.

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After a strong first quarter, the second quarter of 2019 was challenging with AECO 5A natural gas pricing averaging $1.03 per Mcf, the lowest in quarterly average in decades, resulting in adjusted funds used in operations.

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The Assets add growth opportunities in the Pekisko oil play, where Pine Cliff drilled its first oil well in late 2018. Based on Pine Cliff's internal estimates, the Assets will increase Pine Cliff's development inventory to an estimated 28 gross (27 net) Pekisko oil locations.