Calgary, Alberta – Tourmaline Oil Corp. (TSX: TOU) (“Tourmaline” or the “Company”) is pleased to announce reserve and production results for full year 2014.



  • Proved plus probable reserves (2P) increased to 855.8 mmboe during 2014, a 45% increase over 2013 reserves of 590.1 mmboe (38% growth per diluted share). Proved reserves increased 49%, proved developed producing (PDP) and proved developed non-producing reserves increased by 50%.
  • 2P crude and natural gas liquids (“NGL”) reserves increased 54% to 131.7 mmbbls.
  • 2014 2P finding, development and acquisition costs (“FD&A”) including future development costs (“FDC”) were $10.40/boe, 12% lower than 2013 FD&A including FDC costs ($11.84/boe).
  • Tourmaline total 2P reserves at year end 2014 are 4.34 tcf of natural gas and 131.7 mmbbls of oil, condensate and NGL, all with access to (or all of which can be serviced by) existing Company-operated infrastructure.
  • 2014 2P reserve replacement of 7.4 times, a 12% increase over 2013 based on 2P reserve additions of 307.0 mmboe before taking into account 2014 production.
  • 2014 2P total reserve value increased by $1.5 billion to $7.7 billion, discounted at 10%.
  • 2014 2P recycle ratio of 2.2 based on 2P FD&A of $10.40/boe (including FDC) and 2014 estimated cash flow per boe of $22.50.
  • 2014 full year average production of 112,929 boepd resulting in a 51% increase over 2013 average production of 74,796 boepd (40% growth per diluted share). Fourth quarter 2014 average production of 130,944 boepd was 21% higher than the third quarter of 2014.
  • Current production is averaging between 145,000 and 150,000 boepd, anticipated 2015 average production of 164,500 boepd will represent 46% year over year growth.
  • Tourmaline expects full year 2015 operating costs to be 10-15% lower than 2014 costs.
  • Tourmaline plans to reduce the 2015 EP capital program by an additional $200 million to a revised full year budget of $1.2 billion. These facility-related expenditure reductions are not expected to impact current 2015 or 2016 production estimates. The budget reduction will allow the Company to maintain a 2015 debt to cash flow ratio in the 1.1 – 1.4 range, preserving the very strong balance sheet.


2014 Reserve Highlights

Tourmaline continued strong (top tier) growth in all reserve categories in 2014 and reduced annual reserve addition costs despite a record year for facility and construction expenditures. Total 2P FD&A costs including FDC were $10.40/boe in 2014, 12% lower than 2013 FD&A costs including FDC of $11.84/boe. 2014 total proved FD&A costs (including FDC) were $13.71/boe, 22% lower than 2013 FD&A costs (including FDC) of $17.52/boe.

Total 2014 2P reserve value increased by $1.5 billion (a 24% increase over 2013) to $7.7 billion, despite forecast natural gas prices that overall are 8% lower than prices employed in the year end 2013 report. The Company added 307.0 mmboe of new 2P reserves in 2014 prior to 2014 production of 41.2 mmboe, yielding a reserve replacement ratio of 7.4 times and a 2014 2P recycle ratio of 2.2 times. Proved plus probable positive technical revisions of 26.3 mmboe were reported for the year ended 2014, the third consecutive year with positive technical revisions.

After six years of operation, Tourmaline now has independently recognized 2P natural gas reserves of 4.34 tcf and 2P liquid reserves of 131.7 mmbbls utilizing only 8.5% of the Company’s internally-estimated future drilling inventory (810 2P future locations recognized in the independent report). All of the Company’s current recognized and future unbooked reserves and the Company’s estimated future drilling inventory are adjacent to the extensive Company-operated infrastructure that has been constructed in all three core operated areas.


Production Update

2014 average production of 112,929 boepd was 51% higher than 2013 average production of 74,796 boepd (40% growth per diluted share). Current production is ranging between 145,000 and 150,000 boepd. The Company expects to achieve 2015 average production levels of 164,500 boepd in late April with the completion of the winter drilling program (projected 46% year over year growth). A total of 80 – 85 new wells will be brought on stream during the first four months of 2015.

Fourth quarter 2014 average production of 130,944 boepd was 21% higher than third quarter 2014 average production of 107,997 boepd. Strong sequential quarterly growth is anticipated in the first and second quarters of 2015.


2014/2015 EP Capital Programs

2014 capital spending, net of proceeds on dispositions, was $1.8 billion, including the operation of a 20 drilling rig program from May through to year end and a $789.4 million facility and infrastructure construction program. The drilling program included the drilling of 176.7 net wells in calendar 2014, 35 wells ahead of estimates due to steadily improving drilling efficiencies. These additional wells added approximately $190.0 million to 2H 2014 capital budget estimates and are expected to provide significant additional production volumes from 1H 2015 tieins.

The large 2014 facility and infrastructure construction program yielded an exit 2014 Company-operated total processing capacity of 170,000 boepd, sufficient for 2015 production growth estimates (164,500 boepd). Infrastructure construction is now largely complete in all three core complexes, allowing for significant flexibility in the 2015 and 2016 EP capital programs. The 2014 capital program also included expenditures of $177.4 million through the issuance of Tourmaline shares and $40.6 million for debt acquired, both relating to the Santonia Energy Inc. acquisition, as well as $61.4 million on land, and $28.3 million of cash spent on five asset acquisitions completed on the Peace River High during the fourth quarter as the Company continued efforts to consolidate the regional Charlie Lake oil pool. The aggressive facility construction program in the second half of 2014 has already led to substantial operating cost reductions. The Company is anticipating overall operating costs of $4.35/boe in 2015.

The original 2015 EP capital program of $1.6 billion was reduced to $1.4 billion in December as the operated drilling program for 2015 was reduced from 20 to 16 rigs. This reduction does not affect 2015 production estimates as guidance for production growth was built on the basis of a 15 rig program. The Company has elected to further reduce the 2015 capital program by $200 million to $1.2 billion through a reduction in 2015 facility expenditures. This reduction does not affect 2015 production guidance as 2014 exit facility processing capacity matches anticipated 2015 production. The deferred projects include facility expansions at Sundown BC, Wild River AB (100 mmcfpd now redesigned for 50 mmcfpd expansions in 2015 and 2016 respectively) and Columbia AB. The infrastructure expenditures that remain in the 2015 program will yield a 2015 exit Company-operated processing capacity of 200,000 boepd, sufficient to accommodate preliminary 2016 production estimates.

Tourmaline is now expecting 2015 cash flow of approximately $1.1 billion including existing commodity hedges. The 2015 budget reductions will allow the Company to maintain a 2015 debt to cash flow ratio of 1.1 – 1.4 times.


EP Program

Alberta Deep Basin
The Alberta Deep Basin drilling rig fleet will be reduced from 14 to 10 rigs for the balance of 2015. Drilling targets will focus on multi-well pads in defined Wilrich and Notikewin sweet spots. Tourmaline has drilled the five highest deliverability/reserve recovery gas wells in Alberta in 2014. The top well, Basing 2-1, recovered over 1.0 bcf in the first month of production, and is the first well in an extensive new Wilrich sweet spot in the greater BansheeMinehead plant fetch area. Facility projects remaining in the 2015 capital program include the Horse compressor station expansion, a 50 mmcfpd plant expansion at Wild River and a new 50 mmcfpd plant at Edson.

NEBC Montney Gas Condensate
The Montney program in Sunrise-Dawson-Sundown will be reduced from three drilling rigs to two by spring break-up, with one rig scheduled to drill through break-up. Condensate production rates from the lower Montney turbidite wells drilled late in 2013 continue to average 75 – 100 bbls/mmcf. The Company has several new wells to complete in this developing new regional opportunity.

The Sundown 50 mmcfpd facility expansion planned for Q3 2015 has been deferred until 2016. Current production in NEBC is ranging between 35,000 and 40,000 boepd. The Company plans to reach the 43,000 – 45,000 boepd production level in April 2015 and maintain this level for the balance of the year.

Peace River High Charlie Lake
Tourmaline continues to operate three drilling rigs on the Peace River High Charlie Lake oil and gas play, and will
continue at this pace for the balance of the year.

A recent pool extension well on the SW side of the regional pool came on production in late January at 850 bopd with 1.2 mmcfpd of associated natural gas. This delineation well has provided a significant pool expansion and will be followed up with two multi-well pads post break-up. Despite selling 25% of the entire Peace River High complex late in 2014, Tourmaline grew Peace River High 2P reserves by approximately 48% in 2014 after giving effect to the disposition. The Spirit River 3-10 sour gas injection plant commenced operation during the fourth quarter of 2014 and has already led to significant operating cost reductions. Further cost reductions will occur in the first half of 2015 with the completion of the Mulligan battery and expansion of the 3-10 gas plant. These projects in aggregate are expected to reduce overall operating costs in the complex to $10.00 – 11.00/bbl, making the Charlie Lake play one of the lowest cost oil developments in North America.





Reader Advisories

All amounts in this news release are stated in Canadian dollars unless otherwise specified.

Reserves Data
The reserves data set forth above is based upon the reports of GLJ Petroleum Consultants Ltd. (“GLJ”) and
Deloitte LLP, each dated effective December 31, 2014, which have been consolidated into one report by GLJ and
adjusted to apply certain of GLJ’s assumptions and methodologies and pricing and cost assumptions. The
consolidated report includes 100% of the reserves and future net revenue attributable to the properties of
Exshaw Oil Corp, a subsidiary of the Company, without reduction to reflect the 9.4% third-party minority interest
in Exshaw. The price forecast used in the reserve evaluations is an average of the January 1, 2015 price
forecasts for GLJ, Sproule Associates Ltd. and McDaniel & Associates Consultants Ltd., each of which is
available on their respective websites,, and, and will be
contained in the Company’s Annual Information Form for the year ended December 31, 2014, which will be filed
on SEDAR (accessible at on or before March 31, 2015.

There are numerous uncertainties inherent in estimating quantities of crude oil, natural gas and NGL reserves and the future cash flows attributed to such reserves. The reserve and associated cash flow information set forth above are estimates only. In general, estimates of economically recoverable crude oil, natural gas and NGL reserves and the future net cash flows therefrom are based upon a number of variable factors and assumptions, such as historical production from the properties, production rates, ultimate reserve recovery, timing and amount of capital expenditures, marketability of oil and natural gas, royalty rates, the assumed effects of regulation by governmental agencies and future operating costs, all of which may vary materially. For those reasons, estimates of the economically recoverable crude oil, NGL and natural gas reserves attributable to any particular group of properties, classification of such reserves based on risk of recovery and estimates of future net revenues associated with reserves prepared by different engineers, or by the same engineers at different times, may vary. The Company’s actual production, revenues, taxes and development and operating expenditures with respect to its reserves will vary from estimates thereof and such variations could be material.

All evaluations and reviews of future net revenue are stated prior to any provisions for interest costs or general and administrative costs and after the deduction of estimated future capital expenditures for wells to which reserves have been assigned. The after-tax net present value of the Company’s oil and gas properties reflects the tax burden on the properties on a stand-alone basis and utilizes the Company’s tax pools. It does not consider the corporate tax situation, or tax planning. It does not provide an estimate of the after-tax value of the Company, which may be significantly different. The Company’s financial statements and the management’s discussion and analysis should be consulted for information at the level of the Company.

The estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to effects of aggregations. The estimated values of future net revenue disclosed in this press release do not represent fair market value. There is no assurance that the forecast prices and cost assumptions used in the reserve evaluations will be attained and variances could be material.

The reserve data provided in this news release presents only a portion of the disclosure required under National Instrument 51-101. All of the required information will be contained in the Company’s Annual Information Form for the year ended December 31, 2014, which will be filed on SEDAR (accessible at on or before March 31, 2015.

Unaudited Financial Information
Certain financial and operating results included in this news release such as FD&A costs, finding and development costs, recycle ratio, funds from operations, capital expenditures, operating costs and production information are based on unaudited estimated results. These estimated results are subject to change upon completion of the audited financial statements for the year ended December 31, 2014, and changes could be material. Tourmaline anticipates filing its audited financial statements and related management’s discussion and analysis for the year ended December 31, 2014 on SEDAR on or before March 31, 2015.

Per share information is based on the total common shares outstanding, after accounting for outstanding Company options, at year end 2014 and 2013, respectively.

BOE Equivalency
In this press release, production and reserves information may be presented on a “barrel of oil equivalent” or “BOE” basis. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. In addition, as the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.

F&D and FD&A Costs
The Company uses FD&A as a measure of the efficiency of its overall capital program including the effect of acquisitions and dispositions.

The aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserves additions for that year.

Forward-Looking Information
This press release contains forward-looking information within the meaning of applicable securities laws. The use of any of the words “forecast”, “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking information. More particularly and without limitation, this press release contains forward-looking information concerning Tourmaline’s plans and other aspects of its anticipated future operations, management focus, objectives, strategies, financial, operating and production results and business opportunities, including anticipated petroleum and natural gas production for various periods, drilling inventory or locations, cash flow and debt to cash flow levels, capital spending, projected operating and drilling costs, the timing for facility expansions and facility start-up dates, as well as Tourmaline’s future drilling prospects and plans, business strategy, future development and growth opportunities, prospects and asset base. The forward-looking information is based on certain key expectations and assumptions made by Tourmaline, including expectations and assumptions concerning: prevailing commodity prices and currency exchange rates; applicable royalty rates and tax laws; interest rates; future well production rates and reserve volumes; operating costs the timing of receipt of regulatory approvals; the performance of existing wells; the success obtained in drilling new wells; anticipated timing and results of capital expenditures; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the successful completion of acquisitions and dispositions; the state of the economy and the exploration and production business; the availability and cost of financing, labour and services; and ability to market crude oil, natural gas and NGL successfully.

Statements relating to “reserves” are also deemed to be forward looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future.

Although Tourmaline believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Tourmaline can give no assurances that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to: the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of estimates and projections relating to reserves, production, revenues, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; interest rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to complete or realize the anticipated benefits of acquisitions or dispositions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals; and changes in legislation, including but not limited to tax laws, royalties and environmental regulations. Readers are cautioned that the foregoing list of factors is not exhaustive.

Also included in this press release are estimates of Tourmaline’s 2014 capital spending as well as, preliminary guidance on 2015 anticipated cash flow and capital spending, which are based on the various assumptions as to production levels, including estimated average production of 164,500 boepd for 2015, capital expenditures, and other assumptions disclosed in this press release and including commodity price assumptions for natural gas (AECO – $3.50/mcf for 2015), and crude oil (WTI (US) – $57.96/bbl for 2015) and an exchange rate assumption of (US/CAD) $0.84 for 2015. To the extent any such estimate constitutes a financial outlook, it was approved by management and the Board of Directors of Tourmaline on February 17, 2015 and is included to provide readers with an understanding of Tourmaline’s anticipated cash flows based on the capital expenditure and other assumptions described herein and readers are cautioned that the information may not be appropriate for other purposes.

Additional information on these and other factors that could affect Tourmaline, or its operations or financial results, are included in the Company’s most recently filed Management’s Discussion and Analysis (See “Forward-Looking Statements” therein) , Annual Information Form (See “Risk Factors” and “Forward-Looking Statements” therein) and other reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website ( or Tourmaline’s website ( The forward-looking information contained in this press release is made as of the date hereof and Tourmaline undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless expressly required by applicable securities laws.


Additional Reader Advisories

Production Tests
Any references in this release to IP rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will continue to produce and decline thereafter and are not necessarily indicative of long-term performance or ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for the Company. Such rates are based on field estimates and may be based on limited data available at this time.

Non-GAAP Financial Measures
This press release includes references to a financial measure commonly used in the oil and gas industry, “cash flow”, which does not have a standardized meaning prescribed by International Financial Reporting Standards (“GAAP”). Accordingly, the Company’s use of this term may not be comparable to similarly defined measures presented by other companies. Management uses the terms “cash flow for its own performance measures and to provide shareholders and potential investors with a measurement of the Company’s efficiency and its ability to generate the cash necessary to fund a portion of its future growth expenditures or to repay debt. Investors are cautioned that this non-GAAP measure should not be construed as an alternative to net income determined in accordance with GAAP as an indication of the Company’s performance. See “Non-GAAP Financial Measures” in the November 5, 2014 Management’s Discussion and Analysis for the definition and description of this term.

Estimated Drilling Inventory
This press release includes a reference to estimated drilling inventory. These are locations specifically identified by management as an estimation of Tourmaline’s multi-year drilling activities based on evaluation of applicable geologic, seismic, engineering, production and reserves data on contiguous acreage and geologic formations. The availability of local infrastructure, drilling support assets and other factors as management may deem relevant, such as spacing requirements, easement restrictions and regulations, are considered in determining such locations or inventory. The estimated drilling inventory and the locations on which the Company actually drills wells will ultimately depend upon the availability of capital, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results and other factors.


  • bbls – barrels
  • boe – barrel of oil equivalent
  • boepd – barrel of oil equivalent per day
  • bopd – barrel of oil, condensate or liquids per day
  • gjsd – gigajoules per day
  • mmboe – millions of barrels of oil equivalent
  • mmbbls – millions of barrels
  • mbbls – thousand barrels
  • mmcf – million cubic feet
  • mcf – thousand cubic feet
  • tcf – trillion cubic feet
  • mmcfpd – million cubic feet per day
  • mmcfpde – million cubic feet per day equivalent
  • mcfe – thousand cubic feet equivalent
  • mmbtu – million British thermal units
  • mstboe – thousand stock tank barrels of oil equivalent
  • NGL – natural gas liquids




Tourmaline is a Canadian senior crude oil and natural gas exploration and production company focused on longterm growth through an aggressive exploration, development, production and acquisition program in the Western Canadian Sedimentary Basin.


Tourmaline Oil Corp.
Michael Rose
Chairman, President and Chief Executive Officer
(403) 266-5992


Tourmaline Oil Corp.
Brian Robinson
Vice President, Finance and Chief Financial Officer
(403) 767-3587;


Tourmaline Oil Corp.
Scott Kirker
Secretary and General Counsel
(403) 767-3593;


Tourmaline Oil Corp.
Suite 3700, 250 – 6th Avenue S.W.
Calgary, Alberta T2P 3H7
Phone: (403) 266-5992
Facsimile: (403) 266-5952