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DEVELOPMENT OPPORTUNITIES
Value creation within our existing asset base comes through the efficient development
and recovery of oil and gas reserves.
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VALUE CREATION ON EXISTING ASSETS
Value creation within our existing asset base comes through the efficient
development and recovery of oil and gas reserves. This requires operational and
technical excellence, quality oil and gas assets, a keen understanding of risk and
risk mitigants, and an organization adept at execution. Together these factors
provide sustainable, consistent performance over an extended period.
During 2002, Enerplus successfully invested $141.7 million in value creation
activities that improved the oil and gas production and recovery in our existing
assets. We brought on approximately 11,575 BOE/day of new production at an
average cost of $12,242 per daily barrel and added 14.9 million barrels
(established) of new reserves. We drilled or participated in 300 net wells with a
99% success factor, optimized our core waterfloods, completed 66 land
transactions, and expanded our inventory of future projects with emerging
opportunities in coal bed methane, shallow gas development, oil sands and
attractive light oil developments.
Drilling Activity
The Fund participated in drilling 421 gross wells in 2002, including 300 gross
operated wells and 121 gross partner-operated wells. After taking into account
partner working interests, Enerplus drilled 299.5 net wells in 2002 with an overall
success rate of 99%. A significant number of these wells were operated shallow
natural gas wells drilled in southeast Alberta and southwest Saskatchewan in the
areas of Medicine Hat, Hanna Garden, Bantry, Verger and Fox Valley. Significant
partner-operated natural gas wells were drilled in Deep Basin and Mount
Benjamin while major operated oil developments were pursued at Joarcam,
Giltedge, Gleneath and Pembina.
2002 Drilling Activity
 |
| Alberta |
50.0 |
17.0 |
307.0 |
239.4 |
8.0 |
4.2 |
365.0 |
260.6 |
| Saskatchewan |
28.0 |
13.7 |
28.0 |
25.2 |
- |
- |
56.0 |
38.9 |
| British Columbia |
- |
- |
- |
- |
- |
- |
- |
- |
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| Total |
78.0 |
30.7 |
335.0 |
264.6 |
8.0 |
4.2 |
421.0 |
299.5 |
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| Success Rate: 99% |
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- Invested $141.7 million
in value creation
activities
- Added incremental
production of 11,575
BOE/day at an
average cost of $12,242
per daily BOE
- Added incremental
established reserves of
14.9 MMBOE
- Drilled 300 net wells
with a 99% success rate
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Enhanced Recovery Projects
Enhanced recovery projects can significantly improve the recovery from existing oil
and natural gas pools and are essential to maintaining production and reserve life
in maturing basins like The Western Canadian Sedimentary basin. Enerplus is
currently focused on a number of secondary recovery waterfloods in our portfolio
which make up 23% of our current production as well as being involved in a
number of tertiary recovery projects managed by major oil companies. By focusing
our operating knowledge on waterfloods and exposing ourselves to attractive
tertiary projects through minor working interest positions with the majors, we can
leverage our expertise while maintaining a well-diversified asset base.
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| Joarcam Viking |
Enerplus |
80 |
3,189 |
| Pembina |
Enerplus |
100 |
2,507 |
| Giltedge |
Enerplus |
100 |
1,699 |
| Med. Hat Glauc. "C" |
Enerplus |
72 |
1,430 |
| Progress |
Enerplus |
100 |
1,112 |
| Gleneath |
Enerplus |
80 |
1,094 |
| Kessler |
Enerplus |
100 |
588 |
| Chauvin North |
Enerplus |
100 |
567 |
| Silver Heights |
Enerplus |
74 |
460 |
| Shorncliffe |
Enerplus |
89 |
510 |
| Pouce Coupe |
Enerplus |
49 |
392 |
| David |
Enerplus |
100 |
361 |
| Heward |
Enerplus |
100 |
v |
| Battle Creek |
Enerplus |
100 |
286 |
| Neptune |
Enerplus |
90 |
176 |
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| SubTotal |
14,665 |
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| Turner Valley |
Talisman |
5.0 |
230 |
| Swan Hills Unit No. 1 |
Devon |
1.1 |
150 |
| Nelson Viking |
Glencoe |
5.4 |
20 |
| Weyburn |
EnCana |
0.1 |
10 |
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| SubTotal |
410 |
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| Total |
15,075 |
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Waterfloods are a common
and accepted way to improve
recovery from oil pools.
Incremental recovery can be
significant and can
dramatically increase the
economic life of an oil field.
We currently operate 15
waterfloods that represent
23% of our oil production.
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Land Oriented Projects
Enerplus enjoys a large producing and undeveloped land position throughout
western Canada as well as an extensive seismic database and operating knowledge.
The combination of asset knowledge and ownership positions Enerplus to
negotiate attractive farm-ins (accessing land owned by others), farm-outs
(providing others access to Enerplus owned land), joint ventures and other
industry deals. Enerplus is also able to maximize value from existing assets such as
underutilized facilities, selective seismic lines and land use agreements.
Activity in 2002 included 31 farm-outs, 19 poolings, and seven farm-ins that
resulted in 50 well commitments on our lands and our commitment to drill 10
farm-in wells on the lands of industry partners. One hundred percent of our
committed wells were successful. Additional value may be realized over time from
future drilling locations or from additional committed wells that have not yet been
drilled.
2002 Land Summary
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| Alberta |
2,432.2 |
880.1 |
907.5 |
382.7 |
766.7 |
| British Columbia |
237.2 |
50.2 |
121.6 |
56.1 |
173.4 |
| Saskatchewan |
171.1 |
96.1 |
34.1 |
23.8 |
132.1 |
| Other |
0.7 |
0.6 |
0.6 |
0.6 |
180.8 |
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| Total Acres |
2,841.2 |
1,027.0 |
1,063.8 |
463.2 |
1,253.0 |
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Activity in 2002 included
31 farm-outs, 19 poolings
and seven farm-ins that
resulted in 50 well
commitments on our lands.
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