TIDMTGL
RNS Number : 3516F
TransGlobe Energy Corporation
16 November 2020
This Announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 ("MAR"). Upon
the publication of this Announcement, this inside information is
now considered to be in the public domain.
TRANSGLOBE ENERGY CORPORATION ANNOUNCES THIRD QUARTER 2020
FINANCIAL AND OPERATING RESULTS FOR THE THREE AND NINE MONTHSED
SEPTEMBER 30, 2020
AIM & TSX: "TGL" & NASDAQ: "TGA"
Calgary, Alberta, November 16, 2020 - TransGlobe Energy
Corporation ("TransGlobe" or the "Company") is pleased to announce
its financial and operating results for the three and nine months
ended September 30, 2020. All dollar values are expressed in United
States dollars unless otherwise stated. TransGlobe's Condensed
Consolidated Interim Financial Statements together with the notes
related thereto, as well as TransGlobe's Management's Discussion
and Analysis for the three and nine months ended September 30, 2020
and 2019, are available on TransGlobe's website at
www.trans-globe.com .
HIGHLIGHTS:
-- TransGlobe is focused on conserving cash in the current low
commodity price environment. The Company ended the third quarter
with positive working capital of $12.7 million, including cash and
cash equivalents of $27.1 million;
-- Third quarter production averaged 12,044 boe/d (Egypt 9,812
bbls/d, Canada 2,232 boe/d), a decrease of 2,256 boe/d (16%) from
the previous quarter primarily due to deferred well interventions
in Egypt during low oil prices and natural declines;
-- Production in October averaged 12,162 boe/d (Egypt 10,303
bbls/d, Canada 1,859 boe/d), an increase of 1% from Q3-2020, and
below revised budget expectations primarily due to deferred well
interventions in Egypt and repairs on a third-party pipeline in
Canada that required the Company to shut-in certain wells for two
weeks in October;
-- Sales averaged 10,680 boe/d including 259.2 Mbbls sold to
EGPC for net proceeds of $10.2 million in Q3-2020. Average realized
price for Q3-2020 sales of $33.63/boe; Q3-2020 average realized
price on Egyptian sales of $37.15/bbl and Canadian sales of
$20.80/boe;
-- Funds flow from operations of $0.3 million ($0.00 per share) in the quarter;
-- Third quarter net loss of $6.0 million ($0.08 per share),
inclusive of a $0.3 million unrealized loss on derivative commodity
contracts;
-- Contracted a workover rig and began well interventions in
Egypt in September 2020 at West Bakr;
-- Consistent with the revised 2020 budget previously disclosed,
there has been no drilling activity in Canada or Egypt during
Q3-2020;
-- Business continuity plans remain effective across our
locations in response to COVID-19 with no health and safety impacts
or disruption to production;
-- Despite restrictions on travel, management concluded its
negotiations with EGPC to amend, extend and consolidate the
Company's Eastern Desert concession agreements during the quarter.
At this time, it is the Company's belief that EGPC approval will
occur in the near term ; and
-- TransGlobe continues to actively evaluate M&A
opportunities, with a view to not only better position the Company
to weather the current downturn but also rebound strongly once
commodity prices begin to strengthen.
FINANCIAL AND OPERATING RESULTS
(US$000s, except per share, price, volume amounts and %
change)
Three Months Ended September 30 Nine Months Ended September 30
Financial 2020 2019 % Change 2020 2019 % Change
------------------------- --------- -------- -------- -------- -------- --------
Petroleum and natural
gas sales 33,046 64,388 (49) 137,782 214,728 (36)
Petroleum and natural
gas sales, net of
royalties 16,740 31,200 (46) 81,366 111,623 (27)
Realized derivative
gain (loss) on
commodity contracts 662 (112) 691 6,807 (1,041) 754
Unrealized derivative
(loss) gain on
commodity contracts (267) 2,616 (110) 761 (385) 298
Production and
operating expense 11,473 11,564 (1) 45,136 35,507 27
Selling costs 54 76 (29) 1,103 649 70
General and
administrative
expense 2,542 4,102 (38) 8,397 12,743 (34)
Depletion,
depreciation and
amortization expense 5,493 8,173 (33) 23,402 26,184 (11)
Income tax expense 3,092 6,416 (52) 10,122 20,095 (50)
Cash flow (used in)
generated by
operating activities (3,349) 12,042 (128) 17,529 21,096 (17)
Funds flow from
operations(1) 323 9,429 (97) 23,241 43,700 (47)
Basic per share 0.00 0.13 0.32 0.60
Diluted per share 0.00 0.13 0.32 0.60
Net (loss) earnings (5,957) 2,967 (301) (74,542) 4,207 (1,872)
Basic per share (0.08) 0.04 (1.03) 0.06
Diluted per share (0.08) 0.04 (1.03) 0.06
Capital expenditures 437 9,292 (95) 7,243 25,936 (72)
Dividends declared - 2,539 (100) - 5,078 (100)
Dividends declared per
share - 0.035 - 0.070
Working capital 12,708 47,150 (73) 12,708 47,150 (73)
Long-term debt,
including current
portion 25,946 41,726 (38) 25,946 41,726 (38)
Common shares
outstanding
Basic (weighted
average) 72,542 72,542 - 72,542 72,504 -
Diluted (weighted
average) 72,542 72,542 - 72,542 72,508 -
Total assets 205,583 312,654 (34) 205,583 312,654 (34)
-------------------------- -------- -------- -------- -------- -------- --------
Operating
------------------------- -------- -------- -------- -------- -------- --------
Average production
volumes (boe/d) 12,044 15,943 (24) 13,774 16,269 (15)
Average sales volumes
(boe/d) 10,680 14,122 (24) 15,344 15,044 2
Inventory (Mbbls) 534.2 902.6 (41) 534.2 902.6 (41)
Average realized sales
price ($/boe) 33.63 49.56 (32) 32.77 52.28 (37)
Production and
operating expenses
($/boe) 11.68 8.90 31 10.74 8.65 24
-------------------------- -------- -------- -------- -------- -------- --------
(1) Funds flow from operations (before finance costs) is a
measure that represents cash generated from operating activities
before changes in non-cash working capital and may not be
comparable to measures used by other companies. See "Non-GAAP
Financial Measures"
2020 2019
---------------------------------------------- -------------------- ------------
Average reference prices and exchange rates Q-3 Q-2 Q-1 Q-4 Q-3
---------------------------------------------- ------ ----- ----- ----- -----
Crude oil
Dated Brent average oil price ($/bbl) 42.96 29.34 50.44 63.41 61.93
Edmonton Sweet index ($/bbl) 37.35 21.71 38.59 51.56 51.76
Natural gas
AECO ($/MMBtu) 1.69 1.41 1.43 1.88 1.04
US/Canadian Dollar average exchange rate 1.33 1.39 1.35 1.32 1.32
------------------------------------------------ ----- ----- ----- ----- -----
CORPORATE SUMMARY
TransGlobe Energy Corporation ("TransGlobe" or the "Company")
produced an average of 12,044 barrels of oil equivalent per day
("boe/d") during the third quarter of 2020. Egypt production was
9,812 barrels of oil per day ("bbls/d") and Canada production was
2,232 boe/d. Production for the quarter was below revised full year
2020 guidance of 13,300 to 13,800 boe/d due to deferred well
interventions in Egypt during low oil prices and natural declines.
It is expected that, with well interventions performed in September
and Q4-2020, TransGlobe will be within full year 2020 guidance on
an annual basis.
TransGlobe's Egyptian crude oil is sold at a quality discount to
Dated Brent. The Company received an average price of $37.15 per
barrel in Egypt during the quarter. Gharib Blend has benefited from
a relative increase in demand for heavy oil in the past nine months
and the resultant decrease in the differential to Brent. For the
year to date the Gharib Blend differential to Brent has been
$4.50/bbl. In Canada, the Company received an average of $36.99 per
barrel of oil, $15.65 per barrel of NGL and $1.80 per thousand
cubic feet ("Mcf") of natural gas during the quarter.
During Q3-2020, the Company had funds flow from operations of
$0.3 million and ended the quarter with positive working capital of
$12.7 million, including cash and cash equivalents of $27.1
million. The Company had a net loss in the quarter of $6.0 million,
inclusive of a $0.3 million unrealized derivative loss on commodity
contracts which represents a fair value adjustment on the Company's
hedging contracts as at September 30, 2020.
In Egypt, the Company sold 259.2 thousand barrels ("Mbbls") of
entitlement crude oil to EGPC during the quarter, and had 534.2
Mbbls of entitlement crude oil inventory at September 30, 2020. The
increase in inventoried crude oil is attributed to a decrease in
sales volumes, offset by a decrease in production in Q3-2020.
Subsequent to the quarter, TransGlobe completed a 452 Mbbls cargo
lifting of Egypt entitlement crude oil, with proceeds expected in
December. In Canada, the Company sold the Q2-2020 ending inventory
balance of 6.3 Mbbls of Canadian light crude oil in July 2020; all
Canadian production was sold during the quarter.
In Egypt, the Company contracted a workover rig to perform well
interventions at West Bakr beginning in September 2020, and
continuing into the fourth quarter. Consistent with the Company's
revised 2020 budget, there has been no drilling activity in Canada
or Egypt during the third quarter.
Despite restrictions on travel, management concluded its
negotiations with EGPC to amend, extend and consolidate the
Company's Eastern Desert concession agreements during the quarter.
At this time, it is the Company's belief that EGPC approval will
occur in the near term . Following such approval, the merged
concession will require parliamentary ratification. The Company
will provide timely updates as developments unfold.
The Company remains forward looking and prepared to use its
operational control to take advantage of any sustained upward
movement in oil price. TransGlobe continues to be vigilant in its
search for attractive M&A opportunities while steadfastly
retaining its focus on shareholder value creation.
Crisis Mitigation Measures
TransGlobe is focused on conserving cash in the current low
commodity price environment. The Company has successfully
implemented the previously announced 80% reduction in the 2020
capital program and continues to monitor general and administrative
("G&A") cost reductions. The Company estimates that G&A
reduction efforts will reduce go-forward monthly G&A by
approximately 35%.
The Company remains in constant communication with its lenders
(Mercuria Energy Trading SA and ATB Financial) and does not
anticipate deviating from its pre-crisis planned debt reduction
schedule. The Company repaid C$2.0 million ($1.5 million) on the
revolving Canadian reserves-based lending facility with ATB
Financial in September 2020, leaving C$8.2 million ($6.2 million)
drawn and outstanding of a revolving balance of up to C$15.0
million ($11.3 million).
Business continuity plans have been implemented in all our
locations and operations continue as normal. The Company had three
reported cases of COVID-19 in its joint venture in Egypt during
Q2-2020, which were managed according to established Company, local
and national quarantine guidelines. All three have recovered and
returned to work with no onward infection spread reported.
LIQUIDITY AND CAPITAL RESOURCES
Funding for the Company's capital expenditures is provided by
cash flow from operations and cash on hand. The Company is funding
its 2020 development program through the use of working capital and
cash flow from operations. The Company also expects to pay down
debt and explore business development opportunities with its
working capital. Fluctuations in commodity prices, product demand,
foreign exchange rates, interest rates and various other risks may
impact capital resources and capital expenditures.
Working capital is the amount by which current assets exceed
current liabilities. As at September 30, 2020, the Company had a
working capital surplus of $12.7 million (December 31, 2019 - $32.2
million). The decrease in working capital is primarily due to the
$20 million outstanding balance of the Mercuria prepayment
agreement being reclassified as current at quarter end, a decrease
in cash resulting from payments on accounts payable in the period,
a decrease in crude oil inventory due to increased sales to EGPC in
2020, partially offset by a corresponding increase in accounts
receivable and decrease in accounts payable.
As at September 30, 2020, the Company's cash equivalents balance
consisted of short-term deposits with an original term to maturity
at purchase of one month or less. All of the Company's cash and
cash equivalents are on deposit with high credit-quality financial
institutions.
Over the past 10 years, the Company has experienced delays in
the collection of accounts receivable from EGPC. The length of
delay peaked in 2013, returned to historical delays of up to nine
months in 2017, and has since fluctuated within an acceptable range
. As at September 30, 2020, amounts owing from EGPC were $8.0
million. The Company considers there to be minimal credit risk
associated with amounts receivable from EGPC.
In Egypt, the Company sold 259.2 Mbbls of crude oil to EGPC in
Q3-2020 for net proceeds of $10.2 million. During the third quarter
of 2020, the Company collected $16.4 million of accounts receivable
from EGPC, an additional $1.0 million has been collected subsequent
to the quarter. The Company incurs a 30-day collection cycle on
sales to third-party international buyers. Depending on the
Company's assessment of the credit of crude oil purchasers, they
may be required to post irrevocable letters of credit to support
the sales prior to the cargo lifting. As at September 30, 2020,
crude oil held as inventory was 534.2 Mbbls.
As at September 30, 2020, the Company had $86.0 million of
revolving credit facilities with $26.2 million drawn and $59.8
million available. The Company has a prepayment agreement with
Mercuria that allows for a revolving balance of up to $75.0
million, of which $20.0 million was drawn and outstanding as at
September 30, 2020. During the nine months ended September 30,
2020, the Company repaid $10.0 million on this prepayment facility.
The Company also has a revolving Canadian reserves-based lending
facility with ATB that was renewed and reduced as at June 30, 2020
from C$25.0 million ($18.4 million) to C$15.0 million ($11.0
million), of which C$8.2 million ($6.2 million) was drawn and
outstanding. The reduction in the ATB facility is a result of lower
forecasted commodity prices and the associated impact on asset
value. During the nine months ended September 30, 2020, the Company
had drawings of C$0.4 million ($0.3 million) and repayments of
C$2.0 million ($1.5 million) on this facility.
OPERATIONS UPDATE
ARAB REPUBLIC OF EGYPT
EASTERN DESERT
West Gharib, West Bakr, and North West Gharib (100% working
interest, operated)
Operations and Exploration
In Egypt, the Company contracted a workover rig to perform well
interventions at West Bakr beginning in September 2020, and
continuing into the fourth quarter.
Production
Production averaged 9,635 bbls/d during the quarter, a decrease
of 18% (2,122 bbls/d) from the previous quarter. The decrease was
primarily due to deferred well interventions in Egypt during low
oil prices and natural declines. With the well interventions that
began in September 2020, it is expected that production will be
in-line with full year 2020 guidance, including South Ghazalat, of
11,200 to 11,600 bbls/d.
Production in October 2020 averaged 10,161 bbls/d.
Sales
The Company sold 253.1 Mbbls of inventoried entitlement crude
oil to EGPC during the quarter.
Quarterly Eastern Desert Production (bbls/d) 2020 2019
-------------------------------------------------- -------------------------
Q-3 Q-2 Q-1 Q-4
-------------------------------------------------- ------- ------ ------ ------
Gross production rate(1) 9,635 11,757 12,343 12,831
TransGlobe production (inventoried) sold (1,432) (1,761) 7,937 (674)
--------------------------------------------------- ------ ------ ------ ------
Total sales 8,203 9,996 20,280 12,157
--------------------------------------------------- ------ ------ ------ ------
Government share (royalties and tax) 5,452 6,648 6,977 7,250
TransGlobe sales (after royalties and tax)(2) 2,751 3,348 13,303 4,907
--------------------------------------------------- ------ ------ ------ ------
Total sales 8,203 9,996 20,280 12,157
--------------------------------------------------- ------ ------ ------ ------
(1) Quarterly production by concession (bbls/d):
West Gharib - 2,808 (Q3-2020), 3,453 (Q2-2020), 3,664 (Q1-2020),
and 3,857 (Q4-2019)
West Bakr - 6,498 (Q3-2020), 7,935 (Q2-2020), 8,277 (Q1-2020),
and 8,489 (Q4-2019)
North West Gharib - 329 (Q3-2020), 369 (Q2-2020), 402 (Q1-2020),
and 485 (Q4-2019)
(2) Under the terms of the Production Sharing Concession
Agreements, royalties and taxes are paid out of the government's
share of production sharing oil.
WESTERN DESERT
South Ghazalat (100% working interest, operated)
Operations and Exploration
The SGZ-6x well continues to produce from the Upper Bahariya
reservoir at a field estimated rate of 140 bbls/d light and medium
crude to evaluate the zone, restricted to the optimal operation of
the early production facility.
Production
Production averaged 177 bbls/d during the quarter, a decrease of
24% (56 bbls/d) from the previous quarter.
Production in October 2020 averaged 142 bbls/d.
Sales
The Company sold all of its entitlement crude oil production of
6.1 Mbbls in the quarter to EGPC.
CANADA
Operations and Exploration
Consistent with the Company's revised 2020 budget, there has
been no drilling or completion activity during Q3-2020.
Production
In Canada, production averaged 2,232 boe/d during the quarter, a
decrease of 78 boe/d (3%) from the previous quarter and slightly
above revised full year 2020 guidance of 2,100 to 2,200 boe/d. This
marginal decrease was primarily due to natural declines.
The Company sold the Q2-2020 ending inventory balance of 6.3
Mbbls of Canadian light crude oil in July 2020; all Canadian
production was sold during the quarter.
Production in October 2020 averaged 1,859 boe/d with 606 bbls/d
of oil. The decrease in production in October is primarily due to
necessary repairs being performed on a third-party pipeline that
required the Company to shut-in certain wells for approximately two
weeks.
Quarterly Canada Production 2020 2019
------------------------------- --------------------
Q-3 Q-2 Q-1 Q-4
------------------------------- ------ ----- ----- -----
Canada crude oil (bbls/d) 661 706 860 908
Canada NGLs (bbls/d) 798 826 761 735
Canada natural gas (Mcf/d) 4,633 4,665 4,996 5,331
-------------------------------- ----- ----- ----- -----
Total production (boe/d) 2,232 2,310 2,453 2,531
-------------------------------- ----- ----- ----- -----
Condensed Consolidated Interim Statements of (Loss) Income and
Comprehensive (Loss) Income
(Unaudited - Expressed in thousands of U.S. Dollars, except per
share amounts)
Nine Months Ended
Three Months Ended September 30 September 30
2020 2019 2020 2019
------------------------- ---------------- -------------- -------- -------
REVENUE
Petroleum and natural gas
sales, net of royalties 16,740 31,200 81,366 111,623
Finance revenue 9 85 101 401
Other revenue 106 - 328 -
---------------------------- --------------- -------------- -------- -------
16,855 31,285 81,795 112,024
------------------------- --------------- -------------- -------- -------
EXPENSES
Production and operating 11,473 11,564 45,136 35,507
Selling costs 54 76 1,103 649
General and administrative 2,542 4,102 8,397 12,743
Foreign exchange (gain) loss (65) (67) 100 (122)
Finance costs 552 1,030 1,956 3,311
Depletion, depreciation and
amortization 5,493 8,173 23,402 26,184
Asset retirement obligation
accretion 66 51 194 156
(Gain) loss on financial
instruments (395) (2,504) (7,568) 1,426
Impairment loss - (409) 73,495 7,982
Gain on disposition of
assets - (114) - (114)
19,720 21,902 146,215 87,722
------------------------- --------------- -------------- -------- -------
(Loss) earnings before
income taxes (2,865) 9,383 (64,420) 24,302
Income tax expense -
current 3,092 6,416 10,122 20,095
-------------------------- --------------- -------------- -------- -------
NET (LOSS) EARNINGS (5,957) 2,967 (74,542) 4,207
-------------------------- --------------- -------------- -------- -------
OTHER COMPREHENSIVE INCOME
(LOSS)
Currency translation
adjustments 1,188 (410) (1,371) 1,250
---------------------------- --------------- -------------- -------- -------
COMPREHENSIVE (LOSS)
INCOME (4,769) 2,557 (75,913) 5,457
-------------------------- --------------- -------------- -------- -------
Net (loss) earnings per
share
Basic (0.08) 0.04 (1.03) 0.06
Diluted (0.08) 0.04 (1.03) 0.06
---------------------------- --------------- -------------- -------- -------
Condensed Consolidated Interim Balance Sheets
(Unaudited - Expressed in thousands of U.S. Dollars)
As at As at
September 30, 2020 December 31, 2019
---------------------------------------------- ------------------- -----------------
ASSETS
Current
Cash and cash equivalents 27,065 33,251
Accounts receivable 11,869 10,681
Derivative commodity contracts 543 -
Prepaids and other 3,247 4,338
Product inventory 12,415 17,516
------------------------------------------------- ------------------ -----------------
55,139 65,786
Non-Current
Intangible exploration and evaluation assets 584 33,706
Property and equipment
Petroleum and natural gas assets 142,535 196,150
Other 3,100 4,296
Deferred taxes 4,225 8,387
------------------------------------------------- ------------------ -----------------
205,583 308,325
----------------------------------------------- ------------------ -----------------
LIABILITIES
Current
Accounts payable and accrued liabilities 21,030 32,156
Derivative commodity contracts - 217
Current portion of lease obligations 1,606 1,219
Current portion of long-term debt 19,795 -
------------------------------------------------- ------------------ -----------------
42,431 33,592
Non-Current
Long-term debt 6,151 37,041
Asset retirement obligations 12,833 13,612
Other long-term liabilities 161 614
Lease obligations 865 589
Deferred taxes 4,225 8,387
------------------------------------------------- ------------------ -----------------
66,666 93,835
----------------------------------------------- ------------------ -----------------
SHAREHOLDERS' EQUITY
Share capital 152,805 152,805
Accumulated other comprehensive (loss) income (237) 1,134
Contributed surplus 25,013 24,673
(Deficit) Retained earnings (38,664) 35,878
------------------------------------------------- ------------------ -----------------
138,917 214,490
----------------------------------------------- ------------------ -----------------
205,583 308,325
----------------------------------------------- ------------------ -----------------
Condensed Consolidated Interim Statements of Changes in
Shareholders' Equity
(Unaudited - Expressed in thousands of U.S. Dollars)
Nine Months Ended September 30
2020 2019
--------------------------------------------------------- --------------- --------------
Share Capital
Balance, beginning of period 152,805 152,084
Stock options exercised - 547
Transfer from contributed surplus on exercise of options - 174
------------------------------------------------------------ -------------- --------------
Balance, end of period 152,805 152,805
------------------------------------------------------------ -------------- --------------
Accumulated Other Comprehensive (Loss) Income
Balance, beginning of period 1,134 (939)
Currency translation adjustment (1,371) 1,250
------------------------------------------------------------ -------------- --------------
Balance, end of period (237) 311
------------------------------------------------------------ -------------- --------------
Contributed Surplus
Balance, beginning of period 24,673 24,195
Share-based compensation expense 340 494
Transfer to share capital on exercise of options - (174)
------------------------------------------------------------ -------------- --------------
Balance, end of period 25,013 24,515
------------------------------------------------------------ -------------- --------------
(Deficit) Retained Earnings
Balance, beginning of period 35,878 44,951
Net (loss) earnings (74,542) 4,207
Dividends - (5,078)
------------------------------------------------------------ -------------- --------------
Balance, end of period (38,664) 44,080
------------------------------------------------------------ -------------- --------------
Condensed Consolidated Interim Statements of Cash Flows
(Unaudited - Expressed in thousands of US Dollars)
Three Months Ended September 30 Nine Months Ended September 30
2020 2019 2020 2019
-------------- -------------- ------------- ------------- -------------
OPERATING
Net (loss)
earnings (5,957) 2,967 (74,542) 4,207
Adjustments
for:
Depletion,
depreciation and
amortization 5,493 8,173 23,402 26,184
Asset retirement
obligation
accretion 66 51 194 156
Impairment loss - (409) 73,495 7,982
Share-based
compensation (72) 406 (489) 1,749
Finance costs 552 1,030 1,956 3,311
Unrealized loss
(gain) on
financial
instruments 267 (2,616) (761) 385
Unrealized (gain)
loss on foreign
currency
translation (26) (49) 6 (119)
Gain on asset
disposition - (114) - (114)
Asset
retirement
obligations
settled - (10) (20) (41)
Changes in
non-cash
working
capital (3,672) 2,613 (5,712) (22,604)
--------------- ------------- ------------- ------------- -------------
Net cash (used
in) generated
by operating
activities (3,349) 12,042 17,529 21,096
---------------- ------------- ------------- ------------- -------------
INVESTING
Additions to
intangible
exploration
and evaluation
assets - (56) (337) (844)
Additions to
petroleum and
natural gas
assets (399) (9,197) (6,721) (24,621)
Additions to
other assets (38) (39) (185) (471)
Proceeds from
asset
dispositions - 114 - 114
Changes in
non-cash
working
capital (1,883) (2,177) (2,545) (2,478)
--------------- ------------- ------------- ------------- -------------
Net cash used in
investing
activities (2,320) (11,355) (9,788) (28,300)
---------------- ------------- ------------- ------------- -------------
FINANCING
Issue of common
shares for
cash - - - 547
Interest paid (396) (893) (1,526) (2,874)
Increase in
long-term debt 114 114 282 370
Payments on
lease
obligations (366) (540) (1,141) (1,430)
Repayments of
long-term debt (1,504) (6,523) (11,504) (11,523)
Dividends paid - (2,539) - (5,078)
Changes in
non-cash
working
capital - - - (200)
--------------- ------------- ------------- ------------- -------------
Net cash used in
financing
activities (2,152) (10,381) (13,889) (20,188)
---------------- ------------- ------------- ------------- -------------
Currency
translation
differences
relating to
cash and cash
equivalents 49 13 (38) 131
---------------- ------------- ------------- ------------- -------------
NET DECREASE IN
CASH AND CASH
EQUIVALENTS (7,772) (9,681) (6,186) (27,261)
CASH AND CASH
EQUIVALENTS,
BEGINNING OF
PERIOD 34,837 34,125 33,251 51,705
---------------- ------------- ------------- ------------- -------------
CASH AND CASH
EQUIVALENTS, OF PERIOD 27,065 24,444 27,065 24,444
---------------- ------------- ------------- ------------- -------------
Advisory on Forward-Looking Statements
Certain statements included in this news release constitute
forward-looking statements or forward-looking information under
applicable securities legislation. 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. Readers are cautioned that reliance on such
information may not be appropriate for other purposes.
Forward-looking statements or information typically contain
statements with words such as "anticipate", "believe", "expect",
"plan", "intend", "estimate", "may", "will", "would" or similar
words suggesting future outcomes or statements regarding an
outlook. In particular, forward-looking information and statements
contained in this document include, but are not limited to, the
plans for the Company's 2020 Canadian drilling program and the
details thereof; the Company's expectation relating to the
performance of the South Harmattan Cardium prospect; and the
expected benefits to the Company of consolidating, amending and
extending the Company's Eastern Desert PSCs and other matters.
Forward-looking statements or information are based on a number
of factors and assumptions which have been used to develop such
statements and information but which may prove to be incorrect.
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
because the Company can give no assurance that such expectations
will prove to be correct. Many factors could cause TransGlobe's
actual results to differ materially from those expressed or implied
in any forward-looking statements made by, or on behalf of,
TransGlobe.
In addition to other factors and assumptions which may be
identified in this news release, assumptions have been made
regarding, among other things, anticipated production volumes; the
timing of drilling wells and mobilizing drilling rigs; the number
of wells to be drilled; the Company's ability to obtain qualified
staff and equipment in a timely and cost-efficient manner; the
regulatory framework governing royalties, taxes and environmental
matters in the jurisdictions in which the Company conducts and will
conduct its business; future capital expenditures to be made by the
Company; future sources of funding for the Company's capital
programs; geological and engineering estimates in respect of the
Company's reserves and resources; the geography of the areas in
which the Company is conducting exploration and development
activities; current commodity prices and royalty regimes;
availability of skilled labour; future exchange rates; the price of
oil; the impact of increasing competition; conditions in general
economic and financial markets; availability of drilling and
related equipment; effects of regulation by governmental agencies;
future operating costs; uninterrupted access to areas of
TransGlobe's operations and infrastructure; recoverability of
reserves and future production rates; that TransGlobe 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 TransGlobe's conduct and results
of operations will be consistent with its expectations; that
TransGlobe will have the ability to develop its properties in the
manner currently contemplated; current or, where applicable,
proposed industry conditions, laws and regulations will continue in
effect or as anticipated as described herein; that the estimates of
TransGlobe's reserves and resource volumes and the assumptions
related thereto (including commodity prices and development costs)
are accurate in all material respects; and other matters.
Forward-looking statements or information are based on current
expectations, estimates and projections that involve a number of
risks and uncertainties which 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 which may cause actual results to differ materially
from the forward-looking statements or information include, among
other things, operating and/or drilling costs are higher than
anticipated; unforeseen changes in the rate of production from
TransGlobe's oil and gas properties; changes in price of crude oil
and natural gas; adverse technical factors associated with
exploration, development, production or transportation of
TransGlobe's crude oil reserves; the potential impacts of COVID-19
to the Company's business, operating results, cash flows and/or
financial condition; changes or disruptions in the political or
fiscal regimes in TransGlobe's areas of activity; changes in tax,
energy or other laws or regulations; changes in significant capital
expenditures; delays or disruptions in production due to shortages
of skilled manpower equipment or materials; economic fluctuations;
competition; lack of availability of qualified personnel; the
results of exploration and development drilling and related
activities; obtaining required approvals of regulatory authorities;
volatility in market prices for oil; fluctuations in foreign
exchange or interest rates; environmental risks; ability to access
sufficient capital from internal and external sources; failure to
negotiate the terms of contracts with counterparties; failure of
counterparties to perform under the terms of their contracts; and
other factors beyond the Company's control. Readers are cautioned
that the foregoing list of factors is not exhaustive. Please
consult TransGlobe's public filings at www.sedar.com and
www.sec.goedgar.shtml for further, more detailed information
concerning these matters, including additional risks related to
TransGlobe's business.
The forward-looking statements or information contained in this
news release are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise unless required by
applicable securities laws. The forward-looking statements or
information contained in this news release are expressly qualified
by this cautionary statement.
Oil and Gas Advisories
Mr. Ron Hornseth, B.Sc., General Manager - Canada for TransGlobe
Energy Corporation, and a qualified person as defined in the
Guidance Note for Mining, Oil and Gas Companies, June 2009, of the
London Stock Exchange, has reviewed and approved the technical
information contained in this report. Mr. Hornseth is a
professional engineer who obtained a Bachelor of Science in
Mechanical Engineering from the University of Alberta. He is a
member of the Association of Professional Engineers and
Geoscientists of Alberta ("APEGA") and the Society of Petroleum
Engineers ("SPE") and has over 20 years' experience in oil and
gas.
BOEs may be misleading, particularly if used in isolation. A BOE
conversion ratio of six thousand cubic feet of natural gas to one
barrel of oil equivalent (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:
bbl barrels
bbls/d barrels per day
Mbbls thousand barrels
boe barrel of oil equivalent
boe/d barrels of oil equivalent per day
MMBtu One million British thermal units
Mcf thousand cubic feet
Mcf/d thousand cubic feet per day
NGL Natural Gas Liquids
Production Disclosure
Production Summary (WI before royalties and taxes):
Oct - Q3 - Q2 - Q1 - Q4 -
20 20 20 20 19
------- ------- ------- ------- -------
Egypt (bbls/d) 10,303 9,812 11,990 12,544 12,831
------- ------- ------- ------- -------
Eastern Desert of Egypt (bbls/d) 10,161 9,635 11,757 12,343 12,831
------- ------- ------- ------- -------
Heavy Crude (bbls/d) 9,559 9,066 11,001 11,548 11,984
------- ------- ------- ------- -------
Light and Medium Crude (bbls/d) 602 569 756 795 847
------- ------- ------- ------- -------
Western Desert of Egypt (bbls/d) 142 177 233 201 -
------- ------- ------- ------- -------
Light and Medium Crude (bbls/d) 142 177 233 201 -
------- ------- ------- ------- -------
Canada (boe/d) 1,859 2,232 2,310 2,453 2,531
------- ------- ------- ------- -------
Light and Medium Crude (bbls/d) 606 661 706 860 908
------- ------- ------- ------- -------
Natural Gas (Mcf/d) 3,774 4,633 4,665 4,996 5,334
------- ------- ------- ------- -------
Associated Natural Gas Liquids
(bbls/d) 624 798 826 761 735
------- ------- ------- ------- -------
Total (boe/d) 12,162 12,044 14,300 14,997 15,362
------- ------- ------- ------- -------
Production Guidance
Low High Mid-Point
------- ------- ----------
Egypt (bbls/d) 11,200 11,600 11,400
------- ------- ----------
Heavy Crude (bbls/d) 10,304 10,672 10,488
------- ------- ----------
Light and Medium Crude (bbls/d) 896 928 912
------- ------- ----------
Canada (boe/d) 2,100 2,200 2,150
------- ------- ----------
Light and Medium Crude (bbls/d) 646 677 661
------- ------- ----------
Natural Gas (Mcf/d) 4,294 4,499 4,397
------- ------- ----------
Associated Natural Gas Liquids
(bbls/d) 738 774 756
------- ------- ----------
Total (boe/d) 13,300 13,800 13,550
------- ------- ----------
For further information, please contact:
TransGlobe Energy Via FTI Consulting
Randy Neely, President and Chief Executive
Officer
Eddie Ok, Chief Financial Officer
Canaccord Genuity (Nomad & Sole Broker) +44 (0) 20 7523 8000
Henry Fitzgerald-O'Connor
James Asensio
FTI Consulting (Financial PR) +44 (0) 20 3727 1000
Ben Brewerton transglobeenergy@fticonsulting.com
Genevieve Ryan
Tailwind Associates (Investor Relations)
Darren Engels darren@tailwindassociates.ca
http://www.tailwindassociates.ca
+1 403.618.8035
investor.relations@trans-globe.com
http://www.trans-globe.com
+1 403.264.9888
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
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END
QRTDGBDBXUBDGGU
(END) Dow Jones Newswires
November 16, 2020 02:00 ET (07:00 GMT)
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