Deutsche Rohstoff AG: On track for record production in 2023 after first quarter

Mannheim. Deutsche Rohstoff AG provides an overview of the highlights of its operating performance in the first quarter of 2023:
 

• Production in Q1 around 7% above expectations.
• On track for 2023 to produce well above 10,000 BOEPD
• Knight production in Q1 approximately 15% above reserve estimate
• Utah production in Q1 was approximately 30% above reserve estimate, well ahead of plan
• Oil and gas production from the Oxy JV exceeded the reserves report by approximately 25% in Q1
• 37% of expected 2023 production and 75% of existing 2023 production is hedged at USD 75
• Development of wells in Wyoming is on schedule

In the first quarter of the year, production was approximately 10,500 BOEPD, slightly above management's expectations. With this production, the Group is on track for the expected annual production of well over 10,000 BOEPD. In the 2nd and 3rd quarter in particular, numerous well pads will start production and further increase production.

This positive development was driven by the Knight well pad in Colorado, drilling from the Oxy program and continued very strong production in Utah. All other well pads produced in line with expectations of the reserve estimate as of the end of 2022.

Deutsche Rohstoff has continued to increase its hedge book for 2023 and 2024 and is currently hedging 37% of the total annual 2023 production and 75% of the 2023 wells already producing at a price of USD 75 per barrel. Together with the hedges for 2024, approximately 950,000 barrels of oil are hedged at an average price of USD 74. The Company has thus further increased planning certainty, while at the same time having enough unhedged volumes to be able to profit significantly from a further price increase.

The wells in Wyoming are currently also developing very well. Cub Creek has already drilled the first 3 wells from the Lost Springs pad in Wyoming and expects to start production in the summer. Capital expenditures for the wells are approximately USD 29 million for CCE’s share.

As part of the drilling program with Oxy, 10 additional wells will begin production in Q2, with an additional 5 wells to be drilled in the fall of 2023. Salt Creek is investing approximately USD 58 million in these two well pads in 2023.

Activity also remains high on the "non-operated" acreage in Utah. In 2023, 45 wells are expected to commence production (1.1 net wells) at a rate of approximately 2.5% and capex of USD 9.8 million.

Overall, operational performance is very positive. Almost all major development projects are on schedule. With the start of production, they will further strengthen the operating base of Deutsche Rohstoff AG.

In the coming weeks, Deutsche Rohstoff AG will report further details on the operating development. The quarterly report for the first quarter of 2023 is expected to be published at the beginning of May, the annual report 2022 at the end of April.


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