Natural Gas Production Operations
Ember has over 2.5 million gross (2.1 million net) acres of highly contiguous land, producing more than 280 million cubic feet per day of sweet, dry Alberta natural gas extracted from coal.
280 MMCF/D IN NATURAL GAS PRODUCTION
We are Canada?s leader in CBM production with over 10,000 wells of predictable and scalable low-risk, low-cost CBM production and an extensive natural gas inventory behind pipe and future drilling opportunities.
Building on years of successful and repeatable low-cost execution, our coalbed methane (CBM) natural gas operations are focused in the Horseshoe Canyon coals of Alberta – a low-cost, unconventional gas play.
Ember has built its resource base through a consolidation of the Horseshoe Canyon CBM, accomplished through the successful completion of a series of five strategic acquisitions (Fairborne, Sword, Apache, Encana relating to the Nevis Assets and Encana relating to the Clearwater Assets), building its current production base to approximately 280 MMcf/d. The Apache Acquisition and Encana Clearwater Acquisition were, in particular, material acquisitions for Ember and transformative to the Company.
SWEET, CLEAN AND DRY NATURAL GAS PRODUCTION
Ember?s wells are shallow gas wells located in south-central Alberta. Coalbed methane produced from the Horseshoe Canyon formation is ?sweet, clean and dry? natural gas that is a near pipeline-quality right out of the ground.
- Sweet – does not contain hazardous hydrogen sulphide (H2S) or other contaminants.
- Clean – is widely recognized as the cleanest burning fossil fuel produced today.
- Dry – the source coal formations of Horseshoe Canyon contain little to no water so methane production begins as soon as the formation is completed.
LOW COST SHALLOW DRILLING WITH LONG-LIFE RESERVES
Our CBM drilling is quick, efficient and has minimal land disturbance. Drilling to shallow depths of 650 ? 1,200 metres in an average of two drilling days from spud to rig release, our CBM wells cost approximately $175,000 per well to drill.
New wells produce at initial rates of approximately 90 mcf/d of natural gas and produce for 25 ? 30 years. As a result, the company has a low current corporate production decline rate of less than 5% ? Management believes, based on research completed by a third-party regarding its peers, to be among the lowest decline rates for natural gas in the WCSB.
CAPITAL EFFICIENCIES, PREDICTABLE METRICS
Every $0.10/mcf increment in the natural gas prices equals an additional $10 MM in revenues for Ember.
At Ember, we mitigate CBM?s relatively lower revenues through rigorous cost control and low FD&A costs. Our low cost structure positions Ember to benefit from increases in natural gas pricing.
Ember was built to be profitable in today’s gas price environment. Ember’s all-in unlevered break-even realized natural gas price is $1.59/Mcfe (including transportation costs to AECO, operating costs and G&A expense but before royalties estimated at 6% of AECO pricing).