Capex Data
FX Energy, Inc. has set its 2009 capital budget at approximately $23 million. The Company expects to fund this budget with cash on hand and cash flow from operations for the year with no increase in debt or equity. The bulk of the capital budget will be devoted to the Company’s operations in the Fences Concession area in Poland. The Company expects to continue growing its reserves and production there with new production facilities, new wells and a limited amount of new 3-D seismic.
Future Plans
The 2009 budget provides a balanced mix of production facilities construction and new drilling in the 3-D area of the company's Fences concession. Overall, FX Energy expect to participate in 4 or 5 major new wells for the year, which is equivalent to or slightly above 2008 levels. The company also expect higher spending for production facilities as they bring Roszkow production online. Spending for new seismic surveys will be reduced as the need has decreased. The very high level of seismic activity for the last two years has provided more than adequate data for processing, geologic interpretation and well site selection for 2009 and into 2010.
Although the total dollar figure for drilling is projected to be lower for 2009 than 2008, actual drilling activity could prove to be higher. The Company expects to drill or participate in 4 or 5 wells in 2009. Lower projected drilling costs are attributable to three factors. First, the Company expects to enter into a joint venture with another party on at least one of the Company’s exploration blocks. That party is expected to pay most or all of the costs of the well. Also, the strengthened U.S. dollar is expected to reduce substantially the dollar cost of drilling in Poland. Finally, one of the budgeted wells is assumed to be a “side track’’ at approximately one third the cost of a new well. Thus, the combination of virtually no cost for the joint venture, lower dollar costs for oilfield services, and one low-cost well should reduce the required drilling capital while maintaining or even increasing the well count in 2009.