PINECREST ENERGY INC 
By announces that its Board of Directors has approved revisions to the Company's 2013 capital budget.
STRATEGIC RATIONALE
In its first three years, Pinecrest has successfully built an attractive high netback reserve, production and cash flow base and a large operated drilling inventory focused on the Slave Point light oil resource in the Greater Red Earth area of Alberta.
The focus for 2013 has been on improving capital efficiencies and implementing the Company's first seven operated waterflood programs. Success has been achieved on both initiatives. Online well costs have been reduced by over $1 million per well and four of the seven scheduled waterfloods have been commissioned with three more scheduled for implementation early in October. To date, waterflood results have been encouraging with production rates on the first two schemes increasing by three times over the primary production rate.
During this period, Pinecrest's share price has underperformed the peer group on all metrics. As a result, Pinecrest's Board and management believe the true value of the Company is not being recognized. The Board and management believe that in order to succeed in the current business environment, changes to the Company's business plan are necessary to create a long term, sustainable low decline asset base.
Pinecrest has assembled a focused high netback light oil reserve and opportunity base characterized by a best estimate of over 580 million of DOIIP(1) with a very low recovery factor to date of approximately four percent. This asset base has significant upside potential through the implementation of waterfloods complemented with low risk infill drilling. Maintaining a high growth rate on this asset however, has proven to be very difficult due to weather related seasonal access.
Given the early and consistent response to water injection at the Company's initial waterflood programs and in response to the current business environment, the Board and management of Pinecrest have determined that moving towards a more sustainable business model of modest growth is the best strategy for creating shareholder value with the objective of producing a stable, low decline production base with a long reserve life. This change to our business model is established on the following goals and principles:
