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The cut will bring down the Progress capital budget to $270 million dollars from the $365 million announced in February. Progress has reported a first quarter loss in net income, of $6.8 million as compared to a net profit of $1.6 million a year earlier.
However, the company’s billion dollar plus joint venture with Malaysian giant Petronas in the same North Montney region will not be affected by the budget adjustment, which will see half the funds redirected to its Dunvegan light oil program. n a press release, Chief Executive Michael Culbert says, “Progress, is in the fortunate position, of having minimal bank debt, and a joint venture program, where the majority of the capital investment is carried, by our partner, for the next 3 to 5 years.” He adds, “Reducing proprietary capital, while continuing to develop our Montney assets, allows us to grow shareholder value, in a weak natural gas price environment, and continue to advance our (liquefied natural gas) export joint venture, toward final investment decision, by late 2014.”
You may recall, Progress was the object of takeover speculations just last month, after Petronas said it was looking to buy a Canadian company worth more than five billion dollars, as part of a larger $98 billion strategy, to shore up diminishing Malaysian reserves. Progress, 85 per cent weighted to natural gas, sold a portion of its Montney shale gas assets to the state-owned company last June, and also entered a study of the potential to develop a liquefied natural gas export terminal on the northern B.C. coast.
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