Canext Announces Third Quarter Results and Operational Update
18 November 2009 - 9:30PM
Marketwired Canada
Canext Energy Ltd. ("Canext" or the "Company") (TSX VENTURE:CXZ) is pleased to
announce its operating and financial results for the three and nine months ended
September 30, 2009.
Three Months Ended Nine Months Ended
September September
2009 2008 2009 2008
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Average daily production
Oil and NGL's (bbls/d) 228 124 207 147
Natural gas (mcf/d) 4,089 5,184 4,906 5,439
Production (boe/d) 910 988 1,025 1,053
Percentage Oil and NGL's 25% 13% 20% 14%
Highlights ($000's)
Revenue 2,412 4,859 8,258 16,768
Funds from operations 454 1,914 1,385 7,735
Net income/(loss) (1,652) (432) (4,614) (840)
Net capital spending 1,707 11,808 1,000 10,322
Per Common Share
Funds from operations 0.01 0.02 0.02 0.10
Net earnings/(loss) (0.02) (0.00) (0.05) (0.01)
Balance Sheet at period end
(000's)
Property, plant and equipment 61,344 62,507
Net debt 7,735 3,110
Shareholders' equity 52,127 57,768
Wt average shares 000's 87,981 88,485 87,981 80,634
Outstanding at period end 000's 87,981 88,485 87,981 88,485
Revenue $/boe 28.81 53.44 29.51 58.11
Royalty $/boe (6.42) (14.28) (6.60) (12.75)
Opcost $/boe (11.30) (13.11) (12.07) (12.55)
Transportation $/boe (0.52) (0.42) (0.48) (0.41)
Operating Netback $/boe 10.57 25.63 10.36 32.40
G&A (4.59) (5.06) (4.91) (4.96)
(1) Funds from operations and operating netbacks as presented do not have
any standardized meaning prescribed by Canadian GAAP and therefore they
may not be comparable with the calculation of similar measures for other
entities.
Highlights:
- Production averaged 910 boe/d down 7.9% from same period last year as a result
of property dispositions, shut-in production, and deferred capital spending
limiting new well tie-ins,
- Percentage of oil and NGL's production increased to 25% as a result of
increases in oil production at Sweeney,
- Drilled two (1.2 net) successful oil wells at Sweeney including the pool's
first horizontal well. The wells were brought on production subsequent to the
quarter end,
- Net capital spending for the nine month period ended September 30, 2009 was
$1,000,000 (2008 - $10,322,000),
- Operating costs per boe ($11.30/boe) continued to decline despite a one time
adjustment for 2008 third party facility usage which added $0.62/boe,
- Funds from operations for Q3 2009 increased from Q2 2009 despite decreases in
both production and natural gas prices,
- Operating netback averaged $10.57/boe up slightly from the first two quarters
of 2009.
Third Quarter Summary and Operational Update
In the third quarter, natural gas prices declined 61% from the same period last
year. Canext elected to shut-in 240 - 300 mcf/d (40-50 boe/d) representing about
6% of the gas production for the quarter. In addition, several gas tie-in and
recompletion projects were deferred pending higher gas prices. At the end of the
quarter the Company still had a 100% well at Pouce Coupe capable of 800 mcf/d
(130 boe/d) waiting on tie-in. In addition, a horizontal well at Pouce Coupe was
waiting on higher natural gas prices prior to completing the remaining five
fracs which are expected to add 70 - 90 boe/d.
Canext continued to focus capital spending on its oil properties. The percentage
of oil and NGL production increased to 25% in the third quarter, is expected to
increase to 30% in the fourth quarter, with the potential to reach 40% by the
year end.
As disclosed on September 22, 2009, Canext successfully drilled and completed
two (1.2 net) oil wells at Sweeney. One of the wells was a short length
horizontal well. The horizontal well was left open hole without a stimulation
and is producing at 90 bbls/d. This rate is being severely restricted pending
solution gas conservation and good production practice (GPP). Based on the
measured high pumping fluid level and using an inflow performance ratio (IPR)
the well is estimated capable of production at rates of over 1,000 bbls/d. The
most productive vertical well in the pool continues to produce at rates up to
260 bbls/d with a high fluid level. Based on its IPR the well is estimated
capable of 400 bbls/d. The Company is evaluating a larger pumping unit to
increase production on this well.
Construction on the Sweeney oil battery has started. The battery will be capable
of 2,600 barrels of fluid per day and up to 1,000 mcf/d of natural gas. The
first phase will include 4,000 barrels of fluid storage. The target completion
date is prior to December 31, 2009.
Strategic Alternatives
As disclosed on October 27, 2009, the Company has initiated a process to
evaluate various strategic alternatives for the Company. These alternatives may
include a sale, merger, major asset disposition, major financing, or any other
alternative to assist in unlocking additional value for the benefit for all
shareholders. The Company has opened a data room and the process is underway.
Outlook
The Company anticipates the Sweeney battery will be online prior to year end. At
that time, pending GPP approval, production for the pool is expected to increase
by 300 - 400 boe/d (180 - 240 boe/d net).
Canext will continue to focus on its oil development and exploration
opportunities. The Company anticipates drilling three to four (2.2 to 2.8 net)
wells during this winter drilling season from December 2009 to March 2010 in the
Clear Prairie/Sweeney area. The plan is to drill up to two (1.2 net) horizontal
wells at Sweeney targeting undrilled 80 acre infill spacing units. Two of the
targets will be exploration wells including a 100% working interest step-out
well at Sweeney. The step-out well is approximately one mile from the recently
drilled horizontal. Another exploration well (60% working interest) is planned
for Clear Prairie targeting a multi zone 3D seismically defined structure. All
the wells will qualify for the Alberta drilling and royalty incentives which
greatly improve the economics of these prospects.
The Company is well positioned to take advantage of strong oil pricing and
favorable industry costs to expand its oil production while continuing to
explore for new oil pools. Should natural gas prices start to recover this
winter, the Company can move quickly to tie-in additional gas at Pouce Coupe.
Reader advisory:
The term "BOE" may be misleading, particularly if used in isolation. In
accordance with NI 51-101, a BOE conversion ratio for natural gas of 6 mscf: 1
bbl has been used which is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.
Investors are cautioned that the preceding statement of the Company may include
certain estimates, assumptions and other forward-looking information. The actual
future performance, developments and/or results of the Company may differ
materially from any or all of the forward-looking statements, which include
current expectations, estimates and projections, in all or part attributable to
general economic conditions and other risks, uncertainties and circumstances
partly or totally outside the control of the Company, including natural gas/oil
prices, reserve estimates, drilling risks, future production of gas and oil,
rates of inflation, changes in future costs and expenses related to the
activities involving the exploration, development and production of gas and oil
hedging, financing availability and other risks related to financial activities.
The Company's forward looking statements are expressly qualified in their
entirety by this cautionary statement. Except as required by law, the Company
undertakes no obligation to publicly update or revise any forward-looking
statements.
Canext Energy Ltd (TSXV:CXZ)
Historical Stock Chart
Von Mai 2024 bis Jun 2024
Canext Energy Ltd (TSXV:CXZ)
Historical Stock Chart
Von Jun 2023 bis Jun 2024
