Parallel Energy Trust Announces Fourth Quarter and Year End 2013 Financial Results; 2013 Year End Reserve Report and

Parallel Energy Trust Announces Fourth Quarter and Year End 2013 Financial 
Results; 2013 Year End Reserve Report and Operational
Update 
CALGARY, ALBERTA -- (Marketwired) -- 03/20/14 -- Parallel Energy
Trust ("Parallel" or the "Trust") (TSX:PLT.UN)(TSX:PLT.DB) is pleased
to announce its financial and operating results for the three and
twelve months ended December 31, 2013, and to provide a summary of
its 2013 year end reserve report. 
Parallel's audited year end financial statements and accompanying
Management's Discussion and Analysis ("MD&A") will be filed shortly
on the SEDAR website at www.sedar.com and on the Trust's website at
www.parallelenergy.ca. 
Summary of 2013 Financial and Operating Results 


 
                                         ----------------------------------
                                         Quarter  Quarter     Year     Year
                                           ended    ended    Ended    Ended
                                         Dec. 31, Dec. 31, Dec. 31, Dec. 31,
($000s, except where indicated)             2013     2012     2013     2012
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Production                                                                 
  Natural gas (mcf/day)                   14,842   14,945   14,594   12,331
  Condensate (bbls/day)                    1,803    1,821    1,715    1,423
  Natural Gas Liquids (bbls/day)           2,943    2,684    3,000    2,448
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  Total (@6:1) (boe/day)                   7,220    6,996    7,147    5,926
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Average sales price (US$ per boe)          44.49    40.18    42.62    39.85
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Revenue, net of royalties                 25,274   20,882   93,430   70,441
Funds from operations(1)                  11,306    7,847   41,964   35,049
Net income                                 9,912  (84,602)  10,088  (69,956)
Distributions                              8,028   10,920   31,862   44,205
Capital expenditures excluding                                             
 acquisitions                                720    5,743   11,367   27,119
                                                                           
Bank debt outstanding (US$)              154,039  148,651  154,039  148,651
Convertible debentures (CAD$)             63,000   63,000   63,000   63,000
                                                                           
Unitholder's equity                      286,481  281,409  286,481  281,409
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(1) Non-GAAP measure. Readers are referred to Advisories at the end of the 
    press release for additional information.                              

 
Fourth Quarter 2013 Financial and Operating Highlights 
During the fourth quarter of 2013, Parallel: 


 
--  Recorded average daily production of 7,220 boe/day (66% natural gas
    liquids and condensate), an improvement of 2% compared to production of
    7,100 boe/day in the third quarter of 2013. 
--  Realized an average sales price (prior to hedging) of US$44.49 per boe,
    representing approximately 46% of the average WTI price during the
    quarter. 
--  Generated funds from operations of $11.3 million ($0.21 per unit, basic)
    an increase of 5% compared to $10.8 million funds from operations in the
    third quarter of 2013. 
--  Recorded a net impairment reversal of $7.4 million on the Trust's oil
    and gas assets which was predominantly due to higher reserve volumes in
    the Sneed and Carson operating areas, partially offset by lower
    forecasted commodity prices. 
--  Reduced bank debt by approximately US$4.2 million during the quarter.
    This resulted in total bank debt of US$154.0 million drawn against the
    Trust's borrowing base of US$190.0 million. 
--  Declared total distributions of $0.15 during the quarter, representing
    $0.05 per unit per month for October, November and December. 

 
2013 Year End Financial and Operating Highlights 
During the full year 2013, Parallel: 


 
--  Achieved record annual average daily production of 7,147 boe/day, which
    exceeded the Trust's full year guidance of 7,000 boe/day. 
--  Drilled, completed and tied-in a total of 12 gross wells (11.2 net
    wells) in the Texas and Oklahoma operating areas and experienced a 100%
    success rate. The average 30 day initial production ("IP30") rate was 40
    boe/day, resulting in drilling efficiencies of approximately $14,000 per
    flowing boe/day. 
--  Completed 91 cleanouts to the Trust's existing wells and confirmed
    Parallel's decline rates of 8-10%. 
--  Generated funds from operations of $42.0 million ($0.79 per unit,
    basic). 
--  Completed the acquisition of the Cargray operating area which added
    approximately 200 boe/day of liquids-rich natural gas to the Trust's
    production base at accretive metrics. 
--  Declared total distributions of $0.60 during the year, equal to $0.05
    per unit per month. 

 
2013 Year End Reserve Report 
The following information is provided on the Trust's reserves as at
December 31, 2013, as evaluated by the Trust's independent reserves
engineering firm, Ryder Scott. The evaluation of Parallel's petroleum
and natural gas reserves was conducted pursuant to National
Instrument 51-101 - Standards of Disclosure for Oil and Gas
Activities - ("NI 51-101") and the Canadian Oil and Gas Evaluation
Handbook ("COGEH") reserves definitions. 
2013 Reserves Summary 
(Company interest before royalties - December 31, 2013) 


 
                                           --------------------------------
                                           2013 Total       2012 Total     
                                                  Oil              Oil     
                                           Equivalent       Equivalent     
                                                (mboe)   %       (mboe)   %
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Proved developed producing (PDP)               32,985   67      30,307   64
Proved undeveloped                              9,521   19       9,397   20
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  Total proved                                 42,506   86      39,703   84
Probable                                        6,994   14       7,507   16
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  Total proved plus probable (P+P)             49,500  100      47,210  100
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Net Present Value of Future Revenue 
(Company interest - December 31, 2013 escalated price forecast) 


 
                                            -------------------------------
                                             2013 10%         2012 10%     
Present value of cash flows before tax       Discount         Discount     
(US$000s)                                        Rate    %        Rate    %
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PDP                                         $ 373,856   76   $ 366,334   74
Proved undeveloped                             50,981   10      62,279   12
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  Total proved                                424,837   86     428,614   86
Probable                                       66,437   14      71,885   14
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  P+P                                       $ 491,274  100   $ 500,500  100
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CAD/US Exchange Rate at Dec. 31              $ 1.0636         $ 0.9949     
  P+P (C$000s)                              $ 522,519        $ 497,947     
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2013 Year End Reserve Report Highlights 


 
--  Increased proved developed producing reserves by 9% and total proved
    plus probable reserves by 5% between December 31, 2012 and December 31,
    2013. The increase was primarily due to above forecasted drilling
    results in 2013 and the Trust's assets experiencing a lower decline rate
    than previously forecast. 
--  Reported a reserve life index of 13 years for PDP reserves and 19 years
    for P+P reserves based on the mid-point of the Trust's 2014 production
    guidance of 7,200 boe/day. 
--  Reported a total of over 150 gross potential drilling locations after
    having drilled 12 gross wells in 2013. At the 2014 estimated drilling
    pace of 14 gross wells, this represents over 10 years of drilling
    locations. 

 
Operational Update 
Many oil and gas producing areas in the United States experienced
extreme winter weather conditions between November 2013 and March
2014. During these winter months, the Trust's operating areas in
Northern Texas experienced over 30 days in which the temperature fell
below 20 degrees Fahrenheit (-7 degrees Celsius), which is the
highest number of days in almost 20 years and double the average
during that period. At temperatures below 20 degrees Fahrenheit, oil
and gas operating areas in certain regions of the United States tend
to experience equipment freezing, facility and transportation
disruptions, power outages and other operating challenges which can
materially impact oil and gas production levels. The Trust's
operating areas were not immune to these challenges and, as a result,
the Trust has recorded average daily production to date in 2014 of
approximately 6,500 boe/day based on field data, which exceeded the
Trust's three to five per cent contingency for downtime in the first
quarter. However, weather conditions in Parallel's operating areas
have begun to normalize and the Trust's production is beginning to
return to expected levels. Despite the year-to-date performance,
Parallel retains its full year production guidance of 7,100 to 7,300
boe/day in 2014. 
To date in 2014, Parallel has drilled, completed and tied-in a total
of four wells in the Carson operating area. Not all of the wells have
been on production for 30 days; however, initial results indicate
that the wells are achieving, on average, production levels that at
least meet or exceed Parallel's 2014 initial production rate guidance
of 35 to 40 boe/day. 
President's Message - Rick Alexander, President & CEO 
"In 2013 we implemented several changes to stabilize our operations
and better manage our business. These changes led to record annual
production and cash flow which significantly improved our ability to
manage a sustainable business model that supports our $0.05 monthly
distribution. Building on this momentum, we set what we believe are
realistic production and cash flow targets for 2014 and, while we
have experienced challenging operating conditions to date, we remain
confident that we can achieve our full year guidance." 
"Our 2013 reserve report confirmed our analysis that our assets have
a lower decline rate than previously believed. In 2013, we increased
total reserves by five per cent and replaced nearly double our 2013
total production, which reflects our lower decline rates and improved
drilling results during the year. Our total reserve life index also
increased to 13 years for proved developed producing reserves and 19
years for total proved plus probable reserves, which are at or near
the highest in the industry and ideal for a distribution-paying
energy income trust." 
"Our success over the past year is largely due to the hard work and
dedication of our U.S. operating team. Thanks to their efforts, we
are well positioned to execute our 2014 drilling and workover
programs and we expect to begin to realize the benefits of these
programs in the coming months. We look forward to providing updates
on our 2014 drilling program with the release of our first quarter
financial and operating results in early-May." 
ABOUT PARALLEL ENERGY TRUST 
Parallel's objectives are to create stable, consistent returns for
investors through the acquisition and development of conventional oil
and natural gas reserves and production with unexploited low risk
potential in certain regions of the United States, and to pay out a
portion of available cash to holders of trust units on a monthly
basis. The trust units of Parallel are listed on the Toronto Stock
Exchange ("TSX") under the symbol "PLT.UN" and the debentures are
listed on the TSX under the symbol "PLT.DB". 
Parallel is a "mutual fund trust" under the Income Tax Act (Canada)
(the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in
the Tax Act), provided that the Trust complies at all times with its
investment restriction which precludes the Trust from holding any
"non-portfolio property" (as defined in the Tax Act). Further
information relating to Parallel is set out in Parallel's annual
information form dated March 21, 2012, which may be obtained on the
SEDAR website at www.sedar.com under Parallel's profile. 
ADVISORIES 
Forward-Looking Information 
This news release contains forward-looking information that involves
substantial known and unknown risks and uncertainties, most of which
are beyond the control of Parallel, including, without limitation,
those listed under "Risk Factors" in Parallel's annual information
form dated March 21, 2012 (collectively, "forward-looking
information"). Forward-looking information in this news release
includes, but is not limited to, Parallel's objectives and status as
a mutual fund trust and not a SIFT trust and Parallel's expectations
and estimates regarding current and future production rates and
drilling results. Parallel cautions investors in Parallel's
securities about important factors that could cause Parallel's actual
results to differ materially from those projected in any
forward-looking statements included in this news release. Any
statements that express, or involve discussions as to, expectations,
beliefs, plans, objectives, assumptions or future events or
performance are not historical facts and may be forward-looking and
may involve estimates, assumptions and uncertainties which could
cause actual results or outcomes to differ materially from those
expressed in such forward-looking statements. No assurance can be
given that the expectations set out in Parallel's final prospectus or
herein will prove to be correct and accordingly, prospective
investors should not place undue reliance on these forward-looking
statements. These statements speak only as of the date of this press
release and Parallel does not assume any obligation to update or
revise them to reflect new events or circumstances. 
In this news release, Parallel and its subsidiaries are referred to
collectively as the "Trust" or "Parallel" for purposes of
convenience. 
Non-GAAP Measures 
This press release contains the term "funds from operations". This
term is not a recognized measure under Canadian generally accepted
accounting principles (GAAP). Parallel believes that in addition to
net income, funds from operations is a useful supplemental
measurement. Funds from operations provides an indication of the
funds generated by the Trust's principal business activities and is
defined as "cash from operating activities" prior to workovers and
"change in non-cash working capital related to operating activities"
in the Statement of Cash Flows. 
Oil and Gas Measures and Definitions 
This press release contains disclosure expressed as "boe" and
"boe/day". All oil and natural gas equivalency volumes have been
derived using the ratio of six thousand cubic feet of natural gas to
one barrel of oil. Equivalency measures may be misleading,
particularly if used in isolation. A conversion ratio of six thousand
cubic feet of natural gas to one barrel of oil is based on an energy
equivalency conversion method primarily. 
Contacts:
Parallel Energy Trust
Curtis Pelletier
Manager, Investor Relations
403-781-7888 or Toll-Free: 1-855-781-7888
investor@parallelenergy.ca
www.parallelenergy.ca
 
 
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