Traverse Energy Announces 2012 Third Quarter Results
15 Novembre 2012 - 9:18PM
Marketwired Canada
Traverse Energy Ltd. ("Traverse" or "the Company") (TSX VENTURE:TVL) presents
financial and operating results for the nine months ended September 30, 2012.
Unless otherwise stated, the volume conversion of natural gas to barrel of oil
equivalent (BOE) is presented on the basis of 6 thousand cubic feet of natural
gas being equal to 1 barrel of oil. This conversion ratio is based upon an
energy equivalent conversion method primarily applicable at the burner tip and
does not represent value equivalence at the wellhead. BOE figures may be
misleading, particularly if used in isolation.
HIGHLIGHTS Three months ended Nine months ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
(Unaudited) 2012 2011 2012 2011
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Financial ($ thousands, except per share amounts)
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Revenue 2,112 1,105 5,370 2,991
Funds flow from operations 1,602 600 3,809 1,463
Per share - basic and diluted 0.04 0.02 0.09 0.04
Cash flow from operations 1,132 599 3,394 1,544
(including changes in working
capital)
Per share - basic and diluted 0.03 0.02 0.08 0.04
Net income (loss) 32 (1,079) 427 (1,238)
Per share - basic and diluted 0.00 (0.03) 0.01 (0.04)
Capital expenditures, net of
dispositions 3,041 2,836 5,954 7,488
Total assets 21,154 17,096 21,154 17,096
Working capital 1,727 2,078 1,727 2,078
Common shares
Outstanding (millions) 44.3 38.5 44.3 38.5
Weighted average (millions) 44.1 38.5 42.8 35.2
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Operations (units as noted)
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Average production
Natural gas (mcf/day) 1,064 452 822 418
Oil and NGL (bbls/day) 266 126 221 112
Total production (BOE/day) 444 202 358 181
Average sales price
Natural gas ($/mcf) 2.36 3.99 2.25 4.00
Oil and NGL ($/bbl) 76.77 80.76 80.32 83.21
Operating netback ($/BOE)
Petroleum and natural gas
revenue 51.56 60.99 50.85 64.03
Royalties 4.56 3.70 3.33 4.03
Operating and transportation
costs 10.78 22.22 12.74 18.37
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Working interest operating
netback ($/BOE) 36.22 35.07 34.78 41.63
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Royalty netback ($/BOE) 52.02 52.07 60.72 40.02
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Total Company operating netback
($/BOE) 42.31 37.88 45.05 41.39
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Non-GAAP measures
Management uses funds flow from operations and operating netback to analyze
operating performance. These measures are commonly utilized in the oil and gas
industry and are considered informative for management and stakeholders. The
reconciliation between cash flow from operations and funds flow from operations
can be found in the statement of cash flows in the financial statements with
funds flow from operations calculated before non-cash working capital and asset
retirement expenditures. Management believes that in addition to net income
(loss), funds flow from operations is a useful supplemental measure as it
provides an indication of Traverse's operating performance. Operating netback
reflects petroleum and natural gas revenues less royalties, operating and
transportation costs and is calculated on a per unit basis. Investors should be
cautioned, however, that these measures may not be comparable to measures
reported by other companies nor should they be construed as an alternative to
cash flow from operations or other measures of financial performance calculated
in accordance with GAAP.
Operations Review
All of the Company's oil and gas properties are located in Alberta. Traverse is
focusing on its' existing medium and light oil properties located in central and
southern Alberta. At September 30, 2012 undeveloped land holdings totalled
157,600 gross (154,800 net) acres at an average working interest of 98%.
In July, Traverse drilled 5 wells (4.5 net) on the Turin property in southern
Alberta where Traverse has increased its' landholdings to 12,500 gross (11,900
net) acres. Three of these drilling locations were development targets and two
were exploratory in nature. This drilling resulted in 2 oil wells (1.75 net), 2
natural gas wells (1.75 net) and 1 net dry hole. In August the oil wells were
tied into the Company's battery at Turin. The first oil well (Traverse 75%) was
placed on production August 1 and during the third quarter produced at an
average rate of 76 barrels of oil per day. The second oil well (Traverse 100%)
was placed on production in mid August and during the quarter produced at an
average rate of 88 barrels of oil per day and 450 mcf of associated natural gas.
The two natural gas wells are currently shut in. During the third quarter of
2012 the Turin property contributed 203 BOE/day (65% oil) to Company production.
The Turin battery includes a water disposal facility and a treater capable of
handling up to 2,500 barrels of fluid per day. The battery also includes a gas
separator and sweetening unit capable of sweetening up to 2 mmcf of natural gas
per day. The new oil production at Turin is accompanied by increased volumes of
associated gas. The Company is currently evaluating a pipeline expansion to
manage the increased gas volumes.
In the Brazeau area of west central Alberta, Traverse has a gross overriding
royalty interest in 10 sections of land (6,400 acres). By September 30, 2012 a
total of 13 horizontal Cardium wells were drilled on these lands by an industry
partner. Ten of the wells were on production during the quarter resulting in 152
BOE per day (63% light oil) net to the Company. Subsequent to September 30, 2012
two additional wells were drilled by the industry partner.
Subsequent to the third quarter, Traverse drilled two wells in the Turin area.
One well has been completed as an oil well (Traverse 100%) and is anticipated to
be placed on production by December 1 at an approximate rate of 80 BOE/day (70%
oil). The second well, which was a step out well, will be abandoned after
testing indicated no commercial hydrocarbon accumulations. During the first
quarter of 2013 the Company will be shooting a 3D seismic survey in the area
followed up with additional drilling.
During the third quarter Traverse revised its' 2012 budget to $8 million,
deferring the drilling of several wells to 2013. The initial budget for 2013 has
been set at $12.6 million to be funded from working capital, cash flow, new
equity issues and debt where appropriate. The budget includes 2D and 3D seismic
surveys in two project areas and the drilling of 11 wells.
Forward-looking information
This press release contains forward-looking information. Forward-looking
information is based upon the opinions, expectations and estimates of management
as at the date the information is provided and, in some cases, information
received from or disseminated by third parties. In particular, the Company's
statements with respect to a potential gas pipeline expansion in the Turin area;
planned additional seismic surveying and follow up drilling on the Company's
Turin property; intentions for funding capital expenditures during 2013, and the
intention to complete 2D and 3D seismic in two project areas and drill 11 wells
in 2013 are forward-looking information. This forward-looking information is
subject to a variety of substantial known and unknown risks and uncertainties
and other factors that could cause actual events or outcomes to differ
materially from those anticipated or implied by such forward-looking
information. The Company's Annual Information Form filed with securities
regulatory authorities (accessible through the SEDAR website www.sedar.com)
describes the risks, material assumptions and other factors that could influence
actual results and which are incorporated herein by reference.
The forward-looking information contained in this press release is made as of
the date hereof and the Company undertakes no obligation to update publicly or
revise any forward-looking information, whether as a result of new information,
future events or otherwise, unless so required by applicable securities laws.
Further details on the Company including the September 30, 2012 unaudited
interim financial statements, the related management's discussion and analysis
and Annual Information Form are available on the Company's website and SEDAR.
FOR FURTHER INFORMATION PLEASE CONTACT:
Traverse Energy Ltd.
Laurie Smith
President and CEO
www.traverseenergy.com
Traverse Energy (TSXV:TVL)
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