Glacier Upper Montney Well Tested at Record 21 Mmcf/d, Lower Montney Wells Continue to Outperform, Strategic Alternatives

Glacier Upper Montney Well Tested at Record 21 Mmcf/d, Lower Montney Wells 
Continue to Outperform, Strategic Alternatives Update 
CALGARY, Dec. 4, 2013 /CNW/ - Advantage Oil & Gas Ltd. ("Advantage" or the 
"Corporation") is pleased to provide the following operational update related 
to our current Phase VI Glacier Development program and an update on our 
strategic alternatives process. Our Phase VI drilling program commenced in 
August 2013 and is designed to increase Glacier production to 135 mmcfe/d in 
April 2014 which represents a production growth of 25% compared to April 2013. 
New Glacier Upper Montney Well Tested at a Record 21 Mmcf/d 

    --  A new Upper Montney well located at 100/5-20-76-12w6 was
        recently completed with a 14 stage high rate slick water frac
        utilizing an open hole packer system. This well is located in
        the eastern portion of our Glacier land block north of our
        Glacier gas plant.
    --  The new 100/5-20-76-12w6 Upper Montney well was production
        tested for 71 hours and demonstrated a final gas flow rate at
        the end of the test period of 18.4 mmcf/d at a final flowing
        pressure of 8,633 kpa. The final gas flow rate normalized to
        our gas gathering system average pressure of 3,000 kpa is 21.2
    --  The 100/5-20-76-12w6 well demonstrated a final gas flow rate
        that is two to three times better than directly offsetting
        older Upper Montney wells completed with our previous frac
        technique.  This new Upper Montney well also represents the
        best well we have drilled at Glacier on a total rate and rate
        per frac basis as compared to our 80 Glacier Upper Montney
        wells and the 105 total Glacier Montney wells drilled and
        completed to date.
    --  We believe that continued refinement of completion techniques
        and the development of new technology combined with our
        significant experience at Glacier will improve well performance
        in all layers of our Montney "Pentastack".

Lower Montney Wells Continue to Outperform
    --  In order to prove up reserves in the eastern half of our
        Glacier land block where no Lower Montney reserves have been
        booked by our third party independent engineering firm, Sproule
        & Associates Limited ("Sproule"), several Lower Montney wells
        are included in our current Phase VI drilling program.  One of
        these wells is located at 100/1-16-76-12w6 which has recently
        been drilled and completed with a 14 stage high rate slick
        water frac utilizing an open hole packer system.
    --  The new 100/1-16-76-12w6 Lower Montney well was production
        tested for 72 hours and demonstrated a final gas flow rate at
        the end of the test period of 6.7 mmcf/d at a final flowing
        pressure of 4,218 kpa. The final gas flow rate normalized to
        our gas gathering system average pressure of 3,000 kpa is 6.8
    --  The success of the 100/1-16-76-12w6 well demonstrates that the
        Lower Montney reservoir is highly productive in the eastern
        half of our Glacier land block.  Additionally, this successful
        result provides additional confidence that conversion of
        economic contingent resources, as identified by Sproule, is
        possible through drilling and utilization of revised completion
    --  As indicated in our press release dated November 7, 2013, two
        new Lower Montney wells located in the southwest portion of our
        Glacier land block were completed in October 2013 and tested at
        a combined final flow rate of 20 mmcf/d. These two new wells
        are the southernmost horizontal wells we have drilled in the
        Lower Montney and illustrate that the southern portion of our
        Glacier land block is also capable of being highly productive
        in the Lower Montney formation.  These two new wells will also
        result in new reserve additions in this area.
    --  These two new Lower Montney wells were brought on-production in
        November 2013 and demonstrated strong production rates in
        excess of the final test rates. The first Lower Montney well at
        100/15-31-75-13w6 commenced production at a rate of 11.9 mmcf/d
        and the second Lower Montney well at 100/10-31-75-13w6
        commenced production at a rate of 11.8 mmcf/d. After two weeks
        of continuous production, both wells are still capable of
        sustaining these rates and have been choked back due to
        wellsite facilities constraints.
    --  These two new Lower Montney wells are demonstrating initial
        production trends that are similar to our earlier Lower Montney
        well at 100/7-7-76-13w6 which was completed with a similar frac
        design in Q1 2013. The 100/7-7-76-13w6 well was brought on
        production at 12 mmcf/d and has produced 1.8 bcf after nine
        months of production as compared to an average of 0.61 bcf per
        well from older offset Lower Montney wells.
    --  These initial production rates and sustainment of strong rates
        significantly outperform our historical Lower Montney type

Glacier Gas Plant Throughput Tested at 139 Mmcf/d
    --  Strong well results at Glacier combined with the processing of
        third party natural gas volumes during November provided the
        opportunity to conduct a throughput test at our Glacier gas
    --  For several sustained periods in November, the Glacier gas
        plant processed natural gas volumes up to 139 mmcf/d sales with
        no operational issues. Recent regulatory approvals have been
        received and the gas plant is currently licensed to handle up
        to 160 mmcf/d of natural gas. The addition of one new
        compressor to the existing gas plant is required to increase
        processing capacity to 195 mmcf/d of natural gas sales.

Phase VI Glacier Capital Development Program On-Track
    --  Our Phase VI Glacier capital development program which is
        designed to ramp Advantage production to 135 mmcfe/d is
        progressing on-track with three drilling rigs.
    --  To date, 13 of the total 22 wells in the program have been rig
        released. Of the 13 wells drilled, six are Lower Montney wells,
        three are Middle Montney wells and four are Upper Montney
    --  We anticipate additional well completion information will be
        available during the latter half of December 2013.

Strategic Alternatives Process Update
    --  The Corporation's previously announced strategic alternatives
        process remains ongoing. The bid date communicated to
        interested parties has now passed and the Corporation, along
        with its financial advisors, is reviewing the proposals
        received from those parties who submitted bids.
    --  The Corporation cautions that there is no assurance that the
        strategic process will result in an acceptable transaction.

The information in this press release contains certain forward-looking 
statements, including within the meaning of the United States Private 
Securities Litigation Reform Act of 1995. These statements relate to future 
events or our future intentions or performance. All statements other than 
statements of historical fact may be forward-looking statements. 
Forward-looking statements are often, but not always, identified by the use of 
words such as "seek", "anticipate", "plan", "continue", "estimate", 
"demonstrate", "illustrate", "expect", "may", "will", "project", "predict", 
"potential", "possible", "targeting", "intend", "could", "might", "should", 
"believe", "confidence", "would" and similar expressions and include 
statements relating to, but not limited to, anticipated effect of refinement 
of completion techniques, development of new technology and our experience at 
Glacier on well performance; the Corporation's anticipated drilling and 
completion plans; anticipated timing of additional well completion 
information; the Corporation's development plan to increase production at 
Glacier and the anticipated production levels and timing thereof; expected 
reserve additions in the southwest portion of our Glacier land block; 
anticipated production and forecast production levels under the Corporation's 
Phase VI capital development program; and the status of the Corporation's 
strategic alternatives process. In addition, statements relating to "reserves" 
or "resources" are deemed to be forward-looking statements, as they involve 
the implied assessment, based on certain estimates and assumptions that the 
resources and reserves described can be profitably produced in the future.

Advantage's actual decisions, activities, results, performance or achievement 
could differ materially from those expressed in, or implied by, such 
forward-looking statements and accordingly, no assurances can be given that 
any of the events anticipated by the forward-looking statements will transpire 
or occur or, if any of them do, what benefits that Advantage will derive from 

These statements involve substantial known and unknown risks and 
uncertainties, certain of which are beyond Advantage's control, including, but 
not limited to: changes in general economic, market and business conditions; 
industry conditions; actions by governmental or regulatory authorities 
including increasing taxes and changes in investment or other regulations; 
changes in tax laws, royalty regimes and incentive programs relating to the 
oil and gas industry; the effect of acquisitions; Advantage's success at 
acquisition, exploitation and development of reserves; unexpected drilling 
results, changes in commodity prices, currency exchange rates, capital 
expenditures, reserves or reserves estimates and debt service requirements; 
the occurrence of unexpected events involved in the exploration for, and the 
operation and development of, oil and gas properties; hazards such as fire, 
explosion, blowouts, cratering, and spills, each of which could result in 
substantial damage to wells, production facilities, other property and the 
environment or in personal injury; changes or fluctuations in production 
levels; delays in anticipated timing of drilling and completion of wells; 
individual well productivity; competition from other producers; the lack of 
availability of qualified personnel or management; credit risk; changes in 
laws and regulations including the adoption of new environmental laws and 
regulations and changes in how they are interpreted and enforced; our ability 
to comply with current and future environmental or other laws; stock market 
volatility and market valuations; liabilities inherent in oil and natural gas 
operations; uncertainties associated with estimating oil and natural gas 
reserves; competition for, among other things, capital, acquisitions of 
reserves, undeveloped lands and skilled personnel; incorrect assessments of 
the value of acquisitions; geological, technical, drilling and processing 
problems and other difficulties in producing petroleum reserves; ability to 
obtain required approvals of regulatory authorities; ability to access 
sufficient capital from internal and external sources; and failure to complete 
an acceptable transaction pursuant to the Corporation's strategic alternatives 
process. Many of these risks and uncertainties and additional risk factors are 
described in the Corporation's Annual Information Form which is available at and Readers are also referred to risk 
factors described in other documents Advantage files with Canadian securities 

With respect to forward-looking statements contained in this press release, 
Advantage has made assumptions regarding: conditions in general economic and 
financial markets; effects of regulation by governmental agencies; current 
commodity prices and royalty regimes; future exchange rates; royalty rates; 
future operating costs; availability of skilled labor; availability of 
drilling and related equipment; timing and amount of capital expenditures; the 
impact of increasing competition; the price of crude oil and natural gas; that 
the Corporation will have sufficient cash flow, debt or equity sources or 
other financial resources required to fund its capital and operating 
expenditures and requirements as needed; that the Corporation's conduct and 
results of operations will be consistent with its expectations; that the 
Corporation will have the ability to develop the Corporation's crude oil and 
natural gas properties in the manner currently contemplated; current or, where 
applicable, proposed assumed industry conditions, laws and regulations will 
continue in effect or as anticipated; and the estimates of the Corporation's 
production and reserves volumes and the assumptions related thereto (including 
commodity prices and development costs) are accurate in all material respects.

These forward-looking statements are made as of the date of this press release 
and Advantage disclaims any intent or obligation to update publicly any 
forward-looking statements, whether as a result of new information, future 
events or results or otherwise, other than as required by applicable 
securities laws.

References in this press release to initial production test rates, initial 
"productivity", initial "flow" rates, final gas flow rates and average gas 
flow rates are useful in confirming the presence of hydrocarbons, however such 
rates are not determinative of the rates at which such wells will commence 
production and decline thereafter and are not indicative of long term 
performance or of ultimate recovery. While encouraging, readers are cautioned 
not to place reliance on such rates in calculating the aggregate production 
for Advantage. A pressure transient analysis or well-test interpretation has 
not been carried out in respect of the 100/5-20-76-12 w6 Upper Montney well 
and the 100/1-16-76-12w6 Lower Montney well. Accordingly, the Corporation 
cautions that the test results should be considered to be preliminary.

Barrels of oil equivalent (boe) and thousand cubic feet of natural gas 
equivalent (mcfe) may be misleading, particularly if used in isolation. Boe 
and mcfe conversion ratios have been calculated using a conversion rate of six 
thousand cubic feet of natural gas equivalent to one barrel of oil. A boe and 
mcfe 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. Given that the value ratio 
based on the current price of crude oil as compared to natural gas 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.

The following abbreviations used in this press release have the meanings set 
forth below:

mcf    thousand cubic feet

mcfe   thousand cubic feet of natural gas equivalent, using the ratio
       of 6 mcf of natural gas to 1 bbl of oil

mmcfe  million cubic feet of natural gas equivalent, using the ratio of
       6 mcf of natural gas to 1 bbl of oil

mmcf   million cubic feet

mmcf/d million cubic feet per day

bbl    barrel

Boe/d  barrels of oil equivalent per day

SOURCE  Advantage Oil & Gas Ltd. 
Investor Relations Toll free: 1-866-393-0393 
Advantage Oil & Gas Ltd. 700, 400 - 3rd Avenue SW Calgary, Alberta T2P 4H2 
Phone: (403) 718-8000 Fax: (403) 718-8300 Web 
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CO: Advantage Oil & Gas Ltd.
ST: Alberta
-0- Dec/05/2013 00:46 GMT
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