CALGARY,
AB, Aug. 24, 2022 /CNW/ - Kiwetinohk Energy
Corp. (TSX: KEC) has entered into an agreement to acquire an
additional 28.5% average working interest in Kiwetinohk-operated
Montney assets in the Placid area
for total cash consideration of $61.4
million (purchase price net of adjustments is approximately
$59 million) (the Acquisition). The
Acquisition includes 1,200 boe/d (45% oil & liquids) of current
Montney production and increases
Kiwetinohk's Placid area natural gas processing and condensate
handling capacity to 100 MMcf/d and 5,000 bbl/d respectively (an
increase of 30 mmcf/d and 1,750 bbl/d). Kiwetinohk will obtain an
incremental 14.12% ownership in the 14-28 Bigstone sweet natural
gas processing facility, bringing its total working interest to
39.31%. Total owned processing capacity at the Bigstone sweet
natural gas processing facility increases from 20 MMcf/d to 31
MMcf/d. The Acquisition is expected to close on or about
September 15, 2022, with an effective
date of July 1, 2022.
With this Acquisition, Kiwetinohk has now increased its working
interest to 100% in 53,000 Montney
acres in the area where all its new Montney drilling has occurred in the past two
years. The Acquisition consolidates Kiwetinohk's position in the
Placid Montney area and increases its average working interest over
79,000 acres in the region to 88.2%. Grossing up Kiwetinohk's
Montney reserves for the
Acquisition adds 12.9 MMboe of total proved plus probable (TPP)
reserves, based on the independent reserves report of McDaniel
& Associates Consultants Ltd. (McDaniel) effective as of
December 31, 2021. The acquired
assets are in the Company's Montney and Duvernay core area near Fox Creek, Alberta. Following the Acquisition
Kiwetinohk is now 45% weighted to the Montney on current production and 43% on TPP
reserves as reported in McDaniel's independent report at year end
2021.
The Acquisition will be funded through Kiwetinohk's bank
facilities and is accretive on all per share metrics. With ample
borrowing capacity, a lending facility redetermination was not
required to undertake this transaction. Kiwetinohk's next routine
lending redetermination is scheduled for the fourth quarter. On
closing, Kiwetinohk is expected to have $210.0 million of available borrowing capacity,
56% of its current $375 million bank
facility.
Strategic rationale
The Acquisition consolidates Kiwetinohk's interest in the Placid
area, providing control over future development planning,
optimizing infrastructure and streamlining decision making as to
the lands that include the acquired assets. With increased control,
Kiwetinohk plans to accelerate the development of the Placid area
and establish a material Montney
position to complement its existing Duvernay base. Production from the Montney
Placid area may also be used to satisfy Kiwetinohk's Alliance
Pipeline firm commitment obligations, reducing purchased
replacement gas requirements while adding the benefit of currently
favourable Chicago natural gas
pricing to current production, which further increases its
peer-leading corporate netbacks of $70.70/boe (pre-hedging) reported in the second
quarter.
The Acquisition increases Kiwetinohk-owned processing capacity,
further augmenting regional infrastructure ownership and control.
This will enable Kiwetinohk to treat more sour gas through owned
facilities and reduce reliance on third party sour gas processing,
immediately decreasing per boe processing fees. With the added
potential to optimize the facility for sour gas disposal,
Kiwetinohk could further reduce processing costs over the medium
term. This is a continuation of Kiwetinohk's long-term strategy of
owning its processing infrastructure and being a low-cost
producer.
This Acquisition will also eliminate an Area of Mutual Interest
(AMI) agreement. This means Kiwetinohk no longer has an obligation
to offer participation in future Placid area acquisitions to its
former working interest partner, further supporting regional
control over Kiwetinohk's Montney
land position.
"We are buying a non-operated interest in quality lands that we
currently operate. Our knowledge of the assets reduces the risks
related to the transaction," said CEO Pat
Carlson. "The transaction gives us greater control on the
planning and execution of the development of these lands which are
within our Fox Creek core area.
This transaction is an important milestone in our goal of growing
to be a significant provider of clean energy, electricity, and
hydrogen as Alberta's energy
markets transition."
Transaction & valuation
highlights
Reserves and production
- TPP reserves as at December 31,
2021 of 12.9 MMboe, for a TPP reserve valuation of
$4.57/boe.
- July 1 (effective date)
production of 1,200 boe/d, with an estimated netback of
$48.00/boe (pre-hedging, post close)
for a production valuation of $49,200/boe/d, before excluding the value for
infrastructure and undeveloped land.
Infrastructure
- Increases total natural gas processing capacity from 70 MMcf/d
to 100 MMcf/d in Placid area.
- Adds an incremental 14.12% ownership in the 14-28 Bigstone
sweet natural gas processing facility, bringing its total working
interest in the facility to 39.31%. Total owned processing capacity
at Bigstone increases from 20 MMcf/d to 31 MMcf/d.
- Consolidates ownership in Kiwetinohk's anchor 7-11 condensate
handling and sour gas dehydration and compression facility to 100%.
Total owned sour gas dehydration and compression capacity will
increase to 75 MMcf/d (from 50 MMcf/d), and total owned condensate
handling capacity will increase to 5,000 bbl/d (from 3,250
bbl/d).
Run rate cash flow
- Kiwetinohk is evaluating options for a second rig. Kiwetinohk
may accelerate Placid area development and plans to grow acquired
working interest production to plateau levels of 3,500 - 4,000
boe/d by 2023 exit from July volumes of 1,200 boe/d. Cumulative
incremental capital required to reach plateau levels is estimated
at $55 million between 2022 – year
end 2023, funded by $55 million of
field cash flow during the same period net to the acquired working
interest (at the August 9 forward
strip). 1
- At plateau levels, annual field free cash flow is forecasted to
be $20 - $25
million relative to initial acquisition capital of
$59 million net to the acquired
working interest, as the Vendor's volumes benefit from Kiwetinohk's
Alliance contract and Chicago
based US dollar pricing for natural gas. 1
1
|
Average 2022: US$96/Bbl
WTI; US$6.93/MMBtu HH; US$0.78/CAD. Average 2023: US$82/Bbl WTI;
US$5.52/MMBtu HH; US$0.78/CAD.
|
Montney development update
Kiwetinohk's Montney position
consists of 153,000 net acres throughout the Simonette and Placid
areas. Through the Acquisition, Kiwetinohk increases its working
interest in the Placid area acreage from 59.7% to 88.2%. The
acquired 28.5% average working interest in Kiwetinohk's Placid
Montney acreage is highlighted in the cross hatched area in the map
below.
Through the Acquisition, Kiwetinohk will increase its total
Montney drilling inventory by 42.2
net locations, to 346.5 net locations. More specifically, the
Company now has 216.0 net Montney
locations in the Simonette area and 130.5 net Montney locations in the Placid area.
The Placid area has been historically underdeveloped, and with
regional control established, Kiwetinohk plans to accelerate its
Montney development program with a
dedicated drilling program anticipated to start at the end of
2022/early 2023. The Company plans to drill up to 6 wells per year
on this recently consolidated Placid area Montney position. The initial program will
utilize a similar strategy the Company has communicated for its
Simonette area, which is filling its available production
facilities to achieve strong capital efficiencies on new production
and reduce per unit operating costs.
Kiwetinohk's Placid area production is currently 7,000 boe/d
(45% oil and liquids) and is expected to increase to, and be
maintained at, 11,500 – 13,000 boe/d (pro-forma) by 2023 exit, with
the drilling of up to 6 wells per year based on existing owned
facility capacity. As well, the Company has had success moderating
the existing production decline in the Placid area through low-cost
optimization and expects to continue arresting it with its
consolidated ownership.
Kiwetinohk's pro forma Montney
assets have proved developed producing (PDP) reserves of 12.6 MMboe
(42% oil & liquids), total proved (TP) reserves of 39.4 MMboe
(43% oil & liquids), and TPP reserves of 82.9 MMboe (44% oil
& liquids), all based on McDaniel's year-end 2021
evaluation.
Guidance
The increased working interest in the Company's Placid area
Montney assets increases the base
production level over the second half of the year, which has been
reflected in the Company's updated financial and operational
guidance below. The increased production from Placid slightly
increases total corporate operating costs per boe as Placid
operating costs are higher than those at Simonette with positive
adjustments to Placid volumes and operating costs expected to occur
as growth programs are executed in 2023 and beyond. The Acquisition
is not expected to impact overall general and administrative
(G&A) costs; therefore, the increased production base improves
the Company's G&A/boe metric moderately at closing and is
expected to continue to improve as production volumes grow into
next year. Capital guidance for 2022 remains unchanged as the
increased Montney program activity
is expected to be a 2023 impact.
Net debt to annualized adjusted funds flow from operations is
expected to be 0.5x on closing. The leverage ratio remains
comfortably below corporate target ceiling levels of 1.0x and the
Company retains ample borrowing capacity on its credit facilities
to undertake ongoing operations while maintaining strong financial
flexibility.
The following table sets out Kiwetinohk's revised and previous
financial and operational guidance for 2022.
2022 annual
financial &
operational guidance
|
|
|
Revised
August 22
|
|
Revised
August 11
|
Original
January 12
|
Production (2022
average)
|
Mboe/d
|
|
16.0 -
18.0
|
|
15.5 -
17.0
|
13.0 -
15.0
|
Oil &
liquids
|
Mbbl/d
|
|
8.00 -
8.80
|
|
7.75 -
8.50
|
6.50 -
7.50
|
Natural
gas
|
MMcf/d
|
|
48.0 –
55.2
|
|
46.5 –
51.0
|
39 -
45
|
Production by
market 1
|
%
|
|
100 %
|
|
100 %
|
100 %
|
Chicago
|
%
|
|
80% -
85%
|
|
80% -
85%
|
87% -
97%
|
AECO
|
%
|
|
15% -
20%
|
|
15% -
20%
|
3% -
13%
|
Financial
|
|
|
|
|
|
|
Royalty rate
|
%
|
|
10% -
12%
|
|
10% -
12%
|
12% -
15%
|
Operating
costs
|
$/boe
|
|
$8.25 -
$9.00
|
|
$7.50 -
$8.50
|
$7.50 -
$8.50
|
Transportation
|
$/boe
|
|
$5.00 -
$6.00
|
|
$5.00 -
$6.00
|
$5.00 -
$6.00
|
Corporate G&A
expense 2
|
$MM
|
|
$18 -
$20
|
|
$18 -
$20
|
$15 -
$18
|
Cash
taxes
|
$MM
|
|
$0
|
$0
|
$0
|
Capital
guidance (excl. acquisitions)
|
$MM
|
|
290 -
310
|
|
290 -
310
|
210 -
240
|
Upstream
|
$MM
|
|
275 -
290
|
|
275 -
290
|
200 -
220
|
Green
Energy
|
$MM
|
|
15 -
20
|
|
15 -
20
|
10 -
20
|
Drilling - Fox
Creek
|
wells
|
|
16
|
|
16
|
11
|
Duvernay
|
wells
|
|
15
|
|
15
|
10
|
Montney
|
wells
|
|
1
|
|
1
|
1
|
2022 Adjusted funds
flow from
operations sensitivities 3, 4,
5
|
|
|
|
|
|
|
US$70/bbl
WTI & US$3.75/MMBtu HH
|
$MM
|
|
$230 -
$255
|
|
$210 -
$230
|
$145 -
$155
|
US$80/bbl
WTI & US$4.25/MMBtu HH
|
$MM
|
|
$240 -
$265
|
|
$220 -
$240
|
$165 -
$175
|
2022 Net debt to
annualized adjusted funds flow
from operations sensitivities 3, 4,
5
|
|
|
|
|
|
US$70/bbl
WTI & US$3.75/MMBtu HH
|
X
|
|
0.7x
|
|
0.5x
|
1.0x
|
US$80/bbl
WTI & US$4.25/MMBtu HH
|
X
|
|
0.6x
|
|
0.4x
|
0.7x
|
1 – Chicago natural gas
sales of 90% expected for second half of 2022.
|
2 – Includes all
G&A expenses for all divisions of the Company – Corporate,
Upstream, Green Energy and Business Development.
|
3 – Non-GAAP measure
that does not have any standardized meaning under IFRS and
therefore may not be comparable to similar measures presented by
other entities. Please refer to the Corporation's MD&A as at
and for the three months ended June 30, 2022, under the section
"Non-GAAP Measures" available on Kiwetinohk's SEDAR profile at
www.sedar.com.
|
4 – Actual prices up to
August 9th, 2022, with US$70/Bbl WTI flat; US$3.75/MMBtu
HH flat; US$0.79/CAD flat thereafter for remainder of 2022
(September 1st – December 31st).
|
5 – Actual prices up to
August 9th, 2022, with US$80/Bbl WTI flat;
US$4.25/MMBtu HH flat; US$0.81/CAD flat thereafter for remainder of
2022 (September 1st – December
31st).
|
National Bank Financial Inc. is acting as exclusive financial
advisor to Kiwetinohk on the Acquisition.
Norton Rose Fullbright Canada LLP acted as sole legal counsel to
Kiwetinohk on the Acquisition.
About Kiwetinohk
We, at Kiwetinohk, are passionate about addressing climate
change and the future of energy. Kiwetinohk's mission is to build a
profitable energy transition business providing clean, reliable,
dispatchable, low-cost energy. Kiwetinohk develops and produces
natural gas and related products and is in the process of
developing renewable power, natural gas-fired power, carbon capture
and hydrogen clean energy projects. We view climate change with a
sense of urgency, and we want to make a difference.
Kiwetinohk's common shares trade on the Toronto Stock Exchange
under the symbol KEC.
Additional details are available within the year-end documents
available on Kiwetinohk's website at www.kiwetinohk.com and SEDAR
at www.sedar.com.
Oil and Gas Disclosure
Reserves
Reserves estimates in this press release are based on the
evaluation prepared by McDaniel as set out in its report effective
as of December 31, 2021 (the McDaniel
Reserves Report), which was prepared in accordance with National
Instrument 51-101 (NI 51-101) and the Canadian Oil and Gas
Evaluation Handbook. The McDaniel Reserves Report was based on the
average forecast pricing of McDaniel, GLJ Ltd. and Sproule
Associates Limited and inflation rates and foreign exchange rates
as at January 1, 2022, which is
available on McDaniel's website at www.mcdan.com.
|
Tight Oil /
Condensate
(MMbbl)
|
NGLs
(MMbbl)
|
Shale Gas
(MMcf)
|
Total
(MMboe) 1, 2
|
Acquisition
|
|
|
|
|
Proved
Developed Producing
|
1.0
|
0.5
|
11.3
|
3.3
|
Total
Proved
|
2.3
|
0.9
|
23.4
|
7.1
|
Total
Proved plus Probable
|
4.4
|
1.7
|
41.5
|
12.9
|
Kiwetinohk's
Montney
|
|
|
|
|
Proved
Developed Producing
|
3.5
|
1.8
|
43.7
|
12.6
|
Total
Proved
|
12.0
|
5.1
|
133.7
|
39.4
|
Total
Proved plus Probable
|
26.4
|
10.0
|
278.7
|
82.9
|
Notes:
1 Disclosure of reserves on a per boe basis in this
press release consists of the constituent product types and their
respective quantities disclosed in this table.
2 All reserves information in
this press release in respect of the
Acquisition are "Company share reserves". Company
share reserves are the total working interest reserves before the
deduction of any royalties and including any royalty interests
receivable on the assets comprising the Acquisition.
The recovery and reserve estimates of the crude oil, natural gas
liquids and natural gas reserves provided herein are estimates only
and there is no guarantee that the estimated reserves will be
recovered. Actual crude oil, natural gas and natural gas liquids
reserves may be greater than or less than the estimates provided
herein.
The estimates of reserves for individual properties may not
reflect the same confidence level as estimates of reserves for all
properties, due to the effects of aggregation. Please refer to the
Company's 2021 Annual Information Form for a summary of the
Company's total reserves as of December 31,
2021, as evaluated by McDaniel, and set forth in the
McDaniel Reserves Report.
Barrel of Oil Equivalency
The term "boe" may be misleading, particularly if used in
isolation. A boe conversion rate of six thousand cubic feet of
natural gas per barrel of oil (6 mcf:1 bbl) is based on an energy
equivalency conversion method primarily applicable at the burner
tip and do 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 an energy
equivalency of 6:1, utilizing a conversion ratio of 6:1 may be
misleading as an indication of value.
Drilling Locations
This press release discloses drilling locations or inventory.
The table below shows the total locations broken down into proved
locations, probably locations and unbooked locations. Proved
locations and probable locations are derived from McDaniel's
reserves evaluation as of December 31,
2021, and account for drilling locations that have
associated proved and/or probable reserves, as applicable. Unbooked
locations are internal estimates based on the Company's prospective
acreage and an assumption as to the number of wells that can be
drilled per section based on industry practice and internal review.
Unbooked locations do not have attributed reserves or
resources.
|
Acquired
Placid
Montney
|
Total
Placid
Montney
|
Total
Simonette
Montney
|
Total
Montney
|
Proved Locations,
Net
|
6.3
|
18.0
|
11.0
|
29.0
|
Probable Locations,
Net
|
3.8
|
10.8
|
15.0
|
25.8
|
Unbooked Locations,
Net
|
32.1
|
101.7
|
190.0
|
291.7
|
Total Locations,
Net
|
42.2
|
130.5
|
216.0
|
346.5
|
Unbooked locations consist of drilling locations that have been
identified by management as an estimation of the Company's
multi-year drilling activities based on evaluation of applicable
geologic, seismic, engineering, production, and reserves
information. There is no certainty that we will drill all of these
drilling locations and if drilled there is no certainty that such
locations will result in additional oil and gas reserves,
resources, or production. The drilling locations on which we drill
wells will ultimately depend upon the availability of capital,
regulatory approvals, seasonal restrictions, oil and natural gas
prices, costs, actual drilling results, additional reservoir
information that is obtained and other factors. While certain of
the unbooked drilling locations have been de-risked by drilling
existing wells in relative close proximity to such unbooked
drilling locations, other unbooked drilling locations are farther
away from existing wells where management has less information
about the characteristics of the reservoir and therefore there is
more uncertainty whether wells will be drilled in such locations
and if drilled there is more uncertainty that such wells will
result in additional oil and gas reserves, resources or
production.
Production and Production Type Information
References to petroleum, crude oil, natural gas liquids (NGLs),
natural gas and average daily production in this press release
refer to the light and medium crude oil, tight crude oil,
conventional natural gas, shale gas and NGLs product types, as
applicable, as defined in NI 51-101.
NI 51-101 includes condensate within the NGLs product type. The
Company has disclosed condensate as combined with crude oil and
separately from other NGLs since the price of condensate as
compared to other NGLs is currently significantly higher, and the
Company believes that this crude oil and condensate presentation
provides a more accurate description of its operations and results
therefrom. Crude oil therefore refers to light oil, medium oil,
tight oil, and condensate. NGLs refers to ethane, propane, butane,
and pentane combined. Natural gas refers to conventional natural
gas and shale gas combined.
Forward looking information
Certain information set forth in this news release contains
forward-looking information and statements including, without
limitation, management's business strategy, management's assessment
of future plans and operations. Such forward-looking statements or
information are provided for the purpose of providing information
about management's current expectations and plans relating to the
future. Forward-looking statements or information typically contain
statements with words such as "anticipate", "believe", "expect",
"plan", "intend", "estimate", "project", "potential" or similar
words suggesting future outcomes or statements regarding future
performance and outlook. Readers are cautioned that assumptions
used in the preparation of such information may prove to be
incorrect. Events or circumstances may cause actual results to
differ materially from those predicted as a result of numerous
known and unknown risks, uncertainties, and other factors, many of
which are beyond the control of the Company.
In particular, this news release contains forward-looking
statements pertaining to the following:
- the estimated amount of positive working capital that the
Company will receive on closing of the Acquisition and the
estimated net purchase price for the Acquisition;
- that the Acquisition is expected to close by September 15, 2022;
- the Company's plans for how the purchase price will be
funded;
- estimated approximate production in total [and by product type]
from the Acquisition;
- the characteristics of the acquired assets including estimated
production rates and reserves;
- the estimated reserves attributable to the acquired assets and
the Company's estimated pro forma reserves as a result of the
Acquisition;
- that there will be no change to the Company's capital spending
plans in the Placid Montney area;
- that there is ample room for Montney production growth based on the
significant spare capacity of existing owned and third-party
infrastructure;
- that increased ownership of the gas processing facility
provides the Company with increased processing capacity and
optionality for plant optimization;
- the amount of the Company's natural gas to be sold on the
Chicago market and the timing
thereof;
- anticipated North American natural gas prices;
- the Company's updated 2022 financial and operational guidance
and the changes from prior guidance;
- the Company's drilling and development plan for the Acquisition
assets and Kiwetinohk's Placid Montney;
- the plans and expectations to grow the acquired production to
certain plateau levels and the capital costs and the timing thereof
as well as the expected annual cash flows and free cash flows
therefrom;
- estimated drilling locations and the drilling locations
expected to be added from the Acquisition; and
- the Company's business strategies, goals and plans;
In addition to other factors and assumptions that may be
identified in this news release, assumptions have been made
regarding, among other things:
- that the parties will be able to satisfy all conditions
precedent to closing the Acquisition and that the Acquisition will
be completed on the terms and timing contemplated herein;
- that the Company will continue to conduct operations in a
manner consistent with past operations, except as specifically
noted herein;
- the timing and costs of the Company's capital projects,
including drilling and completion of certain wells;
- the impact of increasing competition;
- the general stability of the economic and political environment
in which the Company operates;
- general business, economic and market conditions;
- the ability of the Company to obtain qualified staff, equipment
and services in a timely and cost efficient manner;
- future commodity prices;
- currency, exchange and interest rates;
- the regulatory framework regarding royalties, taxes, and
environmental matters in the jurisdictions in which the Company
operates;
- the ability of the Company to obtain the required capital to
finance its exploration, development and other operations and meet
its commitments and financial obligations;
- the ability of the Company to secure adequate product
processing, transportation, fractionation and storage capacity on
acceptable terms and the capacity and reliability of
facilities;
- the impact of war, hostilities, civil insurrection, pandemics
(including Covid-19), instability and political and economic
conditions (including the ongoing Russian-Ukrainian conflict) on
the Company;
- the impact of rising inflation rates and interest rates on the
North American and world economies and the corresponding impact on
the Company's costs, profitability, and on crude oil, NGLs and
natural gas prices;
- future production rates and estimates of operating costs and
development capital, including as specifically set forth
herein;
- performance of existing and future wells;
- reserve volumes as set forth in the McDaniel Reserves
Report;
- anticipated timing and results of capital expenditures /
development capital, including as specifically set forth
herein;
- the success obtained in drilling new wells;
- the sufficiency of budgeted capital expenditures in carrying
out planned activities; and
- the ability of the Company to successfully market its
products.
Readers are cautioned that the foregoing list is not exhaustive
of all factors and assumptions that have been used. Although the
Company believes that the expectations reflected in such
forward-looking statements or information are reasonable, undue
reliance should not be placed on forward-looking statements as the
Company can give no assurance that such expectations will prove to
be correct.
Forward-looking statements or information involve a number of
risks and uncertainties that could cause actual results to differ
materially from those anticipated by the Company and described in
the forward-looking statements or information. These risks and
uncertainties include, among other things:
- the risk that the Acquisition is not completed on the terms
and/or on the timing contemplated herein;
- the risk that we do not realize some or all of the anticipated
benefits of the Acquisition;
- the risk that any of the Company's material assumptions prove
to be materially inaccurate;
- those risks set out in the Annual Information Form (AIF) under
"Risk Factors";
- the ability of management to execute its business plan;
- general economic and business conditions;
- risks of war, hostilities, civil insurrection, pandemics
(including Covid-19), instability and political and economic
conditions in or affecting jurisdictions in which the Company
operates;
- operational and construction risks associated with certain
projects;
- the possibility that government policies or laws may change or
governmental approvals may be delayed or withheld;
- risks relating to regulatory approvals and financing;
- the Company's ability to enter into or renew leases;
- potential delays or changes in plans with respect to capital
expenditures;
- risks associated with rising capital costs and timing of
project completion;
- fluctuations in commodity prices, foreign currency exchange
rates and interest rates;
- risks inherent in the Company's marketing operations, including
credit risk;
- health, safety, environmental and construction risks;
- risks associated with existing and potential future lawsuits
and regulatory actions against the Company;
- uncertainties as to the availability and cost of
financing;
- the ability to secure adequate processing, transportation,
fractionation and storage capacity on acceptable terms;
- processing, pipeline and fractionation infrastructure outages,
disruptions and constraints;
- financial risks affecting the value of the Company's
investments; and
- other risks and uncertainties described elsewhere in this
document and in Kiwetinohk's other filings with Canadian securities
authorities.
Readers are cautioned that the foregoing list is not exhaustive
of all possible risks and uncertainties.
The forward-looking statements and information contained in this
news release speak only as of the date of this news release and the
Company undertakes no obligation to publicly update or revise any
forward-looking statements or information, except as expressly
required by applicable securities laws.
Non-GAAP Measures
This news release contains the following measures that do not
have a standardized meaning under generally accepted accounting
principles (GAAP) and therefore may not be comparable to
similar measures presented by other entities: borrowing capacity,
free cash flow, adjusted funds flow from operations, net debt and
net debt to adjusted funds flow from operations. These
measures should not be considered in isolation or as a substitute
for performance measures prepared in accordance with GAAP and
should be read in conjunction with the consolidated financial
statements of the Company. Readers are cautioned that these
non-GAAP measures do not have any standardized meanings and should
not be used to make comparisons between Kiwetinohk and other
companies without also taking into account any differences in the
method by which the calculations are prepared.
Please refer to the Corporation's MD&A as at and for the six
months ended June 30, 2022, under the
section "Non-GAAP Measures" for a description of these measures,
the reason for their use and a reconciliation to their closest GAAP
measure where applicable. The Corporation's MD&A is available
on Kiwetinohk's SEDAR profile at www.sedar.com
Future-Oriented Financial
Information
Financial outlook and future-oriented financial information
contained in this press release about prospective financial
performance, financial position or cash flows is based on
assumptions about future events, including economic conditions and
proposed courses of action, based on management's assessment of the
relevant information currently available. In particular, this press
release contains estimates for cash flow, free cash flow, adjusted
funds flow from (used in) operations, and net debt per adjusted
funds flow from (used in) operations. These projections contain
forward-looking statements and are based on a number of material
assumptions and factors set out above and are provided to give the
reader a better understanding of the potential future performance
of the Company in certain areas. Actual results may differ
significantly from the projections presented herein. These
projections may also be considered to contain future oriented
financial information or a financial outlook. The actual results of
the Company's operations for any period will likely vary from the
amounts set forth in these projections, and such variations may be
material. See "Risk Factors" in the Company's AIF published on the
Company's profile on SEDAR at www.sedar.com for a further
discussion of the risks that could cause actual results to vary.
The future oriented financial information and financial outlooks
contained in this press release have been approved by management as
of the date of this press release. Readers are cautioned that any
such financial outlook and future-oriented financial information
contained herein should not be used for purposes other than those
for which it is disclosed herein.
Abbreviations
$/bbl
|
dollars per
barrel
|
$/boe
|
dollars per barrel
equivalent
|
$MM
|
millions of
dollars
|
bbl/d
|
barrels per
day
|
boe
|
barrel of oil
equivalent, including crude oil, condensate, natural gas liquids,
and natural
gas (converted on the basis of one boe per six mcf of natural
gas)
|
HH
|
Henry Hub
|
Mbbl/d
|
millions of barrels per
day
|
Mboe/d
|
millions of barrels of
oil equivalent per day
|
Mcf/d
|
thousand cubic standard
feet per day
|
MMboe
|
million barrels of oil
equivalent
|
MMBtu
|
million British thermal
units
|
MMcf/d
|
million cubic feet per
day
|
WTI
|
West Texas
Intermediate
|
FOR MORE INFORMATION ON KIWETINOHK, PLEASE
CONTACT:
Mark
Friesen, Director, Investor Relations
IR phone: (587) 392-4395
IR email: IR@kiwetinohk.com
Address: Suite 1900, 250 - 2 Street S.W.
Calgary, Alberta T2P 0C1
Pat
Carlson, CEO
Jakub Brogowski, CFO
SOURCE Kiwetinohk Energy