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Abstract
(CCNMatthews - April 18, 2006) - Prairie Schooner Petroleum Ltd. (TSX:PSL) ("Prairie Schooner" or the "Company") Due to a production performance issue on one of Prairie Schooner's east central Alberta properties and ongoing delays in tieing in behind pipe production, the Company is reducing its 2006 average production target by 7.5% from 8,000 to 7,400 boe/d and reducing its 2006 exit rate production target from 9,000 to 8,400 boe/d.
In early April the company began to experience production difficulties from two natural gas wells at our Two Hills property in east central Alberta. The two wells had been on production at consistent rates for approximately one year before they began to produce substantial volumes of water. To prudently manage the reservoir and attempt to maintain the ultimate reserves associated with these wells, the rate of production from both wells has been reduced. The net result of these actions was to reduce corporate production by approximately 500 boe/d. Although it will ultimately take longer to recover the reserves associated with these wells, it is anticipated that prudent reservoir management actions should only reduce the expected recoverable reserves from these wells by approximately 130 mboe. This reduction in reserves is anticipated to be recovered through the drilling of one additional location in the pool. The potential impact to the 10% before tax net asset value of the company is negligible at managements estimate of $4.5 million or $0.20 per share.