ARC Resources to grow 2016 gas production five per cent in Dawson area

ARC resources plans to grow its natural gas production in the Montney shale in 2016 as part of a $550 million capital spending plan. 

The upstream oil and gas company will invest $100 million in its Montney holdings, according to a release Wednesday. 

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According to the Calgary Herald, the company budgeted $1.04 billion in capital spending last year. ARC was the first major Calgary company to announce its 2016 plan. The company posted a $235 million loss in the third-quarter. 

"In 2016, we expect to deliver approximately five per cent annual production growth relative to 2015 levels, set the stage for continued development at Dawson in 2017 and beyond, and continue to pay a meaningful dividend to our shareholders," the release states. 

Also on the docket is $90 million in infrastructure spending "to proceed with plans for the new gas processing and liquids handling facility at Dawson." 

That facility, expected on-stream in late 2017, will have a gas processing capacity of 90 million cubic feet (MMcf) per day and 7,500 barrels per day of liquids-handling capacity. 

"Gas production is expected to ramp up over the fourth quarter of 2017, however liquids production will be below capacity until wells with higher liquids-content are drilled," the release states. 

Of 77 planned wells, nine liquids-rich wells are planned in the Dawson, Parkland, Attachie and Pouce Coupe gas fields. Another 14 are planned for the Dawson and Sunrise areas. Fifty-two wells will be crude oil wells. 

The company is banking on $55 per barrel oil and $2.50 per gigajoule of natural gas. 

Unlike some upstream companies in Northeast B.C., drilling is not tied to a specific liquefied natural gas project. 

Seventy-five per cent of ARC's capacity goes to the AECO hub in southern Alberta, 20 per cent to Station 2 south of Fort St. John, and around five per cent to the Alliance pipeline system. 

reporter@dcdn.ca 

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