Since 2008, Progress Energy has been transformed from a steady energy trust to a burgeoning explorer with growing production and a massive undeveloped land base.
Today, we hold 1.3 million net undeveloped acres of highly prospective leases throughout Northeast British Columbia and Northwest Alberta. Approximately 820,000 of these acres are on the prolific Montney gas trend. From this land base, we have plans to double production in five years to 100,000 boe/d.
2001 – Progress Energy recapitalized under new management
Calpine Corporation purchased the assets of Encal Energy, while the former principals of Encal purchased and recapitalized Progress to continue their search for natural gas, building on their experience in Northeast BC. The new management of Progress made significant investments in the company in order to back their confidence in the gas plays they planned to pursue. At the time of the acquisition, Progress had 2,000 boe/d of production from properties scattered across Western Canada.
2002 — Progress acquires former Encal properties
Progress entered into a deal with Pengrowth Energy Corporation in order to acquire former Encal leases put up for sale by Calpine. As a small producer, Progress took a 20-per-cent share in the deal and Pengrowth took 80 per cent. With this arrangement, Progress established its initial position in Northeast British Columbia, with plans to pursue prospects in the Halfway formation.
2004 — Growing production, merger with Cequel and reorganization
Progress reached 10,000 boe/d of production, primarily from the Halfway formation. Progress then arranged a merger with Cequel Energy, which brought 12,000 boe/d of Alberta Deep Basin production to the merged entity. The deal resulted in the creation of Progress Energy Trust and ProEx Energy, with a single, shared management structure. Progress focused on steady production growth and cash distributions to unitholders, while ProEx pursued exploration prospects, primarily in the Halfway horizon in the Foothills of northeast British Columbia.
2007 — Progress and ProEx acquire BG assets
Progress capitalized on the withdrawal of BG from Canada, acquiring 330,000 net acres of former BG assets, including lands in the Caribou and Montney trends. Progress kept the producing properties and ProEx took the exploration assets.
2008 — ProEx increases production and tests the Montney
Exploration success in the Halfway formation enabled ProEx to increase its production to 10,000 boe/d.
After watching the Montney play develop to the south, ProEx decided to investigate the possibility that the deep formation extended north into lands where Progress and ProEx held the shallower rights. Log and core analyses, as well as logs from previous drilling in Progress/ProEx lands indicated no differences between Montney discovery areas held by major explorers to the south and the stratigraphy in the areas held by Progress/ProEx.
ProEx drilled a well to the DeBolt formation underlying the Montney and then tested the Montney formation. The well was a qualified success and the same methods were used on a second Montney well in the same area. This well was also productive and ProEx then moved eight miles southeast and used a different formation fracturing technique that resulted in strong production. A horizontal well with multi-zone fracturing in the same area then produced 10 MMcf/d of gas from the Montney formation.
With these encouraging results, ProEx accelerated acquisition of deep rights underlying its shallower leases in the area and assembled a huge land position before the end of the year.
2009 — Progress and ProEx merge and wind up trust
The sister companies became early movers in the windup of the Canadian energy trust era, agreeing to merge into a single exploration and production company well ahead of the Jan. 1, 2011 federally-mandated end to energy-trust tax breaks. Driving their decision was the need for greater combined capital resources to pursue the rapidly developing Montney play. The new entity, Progress Energy Resources Corporation, was a mid-sized company. The company produced some 35,000 boe/d of natural gas but was dwarfed by its own potential.
2010 — Production and land position expand
In 2010, Progress acquired the Foothills assets of Suncor Energy, including additional deep rights in the Montney formation. This acquisition gave Progress a total Montney acreage of 900,000 acres. By November of 2010, total production had reached 45,000 boe/d.
2011 — Putting the Montney on the Global Stage
Progress undertook a successful joint venture process in 2011 which culminated in June when Progress and the Malaysian national oil and gas company PETRONAS entered into an agreement to form a 50/50 North Montney Joint Venture to develop the Altares, Lily, and Hakta properties. In addition, Progress positioned itself to be an equity owner in a LNG facility on the West Coast of British Columbia by establishing a downstream LNG Export Joint Venture with PETRONAS.
2012 — Montney reserves continue to grow
Progress’ success in exploring and exploiting the North Montney fairway continued throughout 2011 and resulted in year-end reserve bookings of approximately 1.1 TCFE from the Montney formation. In total, Progress grew its reserve base by 28 percent in 2011 to over 323 million barrels of oil equivalent, proved plus probable.
2012 — Progress Energy Canada Ltd – The next chapter
In June of 2012 Progress was wholly acquired by PETRONAS, the national oil and gas company of Malaysia. The acquisition was completed in December of 2012 and Progress began operating as Progress Energy Canada Ltd.