Montney producer Advantage Energy to cut gas production
Montney producer Advantage Energy said October 8 it would curtail up to 130mn ft3/day of dry gas production in response to unusually low Alberta natural gas prices.
The curtailments, largely in the company’s low-cost Glacier asset near Grande Prairie, began in September and are expected to continue through Q4 2024 until prices recover.
The AECO monthly average was C$1.30/mn Btu in May this year but slumped through the summer and averaged just C$0.50/mn Btu in September, according to consultancy Sproule’s latest forecast report.
Advantage said the curtailments, which will not extend to oil and liquids production, are being determined on a continuous basis to eliminate variable cash costs and defer development capital. Its production during Q3 2024 averaged about 74,000 barrels of oil equivalent (boe)/day, including 368mn ft3/day of natural gas and 12,700 barrels/day of crude oil and liquids, and included curtailments of more than 5,000 boe/day.
With lower depletion resulting from the curtailments, Advantage has reduced its 2024 capital programme, which is now expected to approach the bottom of its latest guidance range (C$260-C$290mn). Depending on the duration of the curtailments, 2024 production is expected to average about 70,000 boe/day.