Razor Energy Corp. (“Razor” or the “Company”) (TSXV: RZE) announces
its first quarter 2022 financial and operating results and the
appointment of Michael Blair as Chief Operating Officer. Selected
financial and operational information is outlined below and should
be read in conjunction with Razor’s unaudited interim condensed
consolidated financial statements and management’s discussion and
analysis for the three months ended March 31, 2022 which are
available on SEDAR at www.sedar.com and the Company’s website
www.razor-energy.com.
All amounts are expressed in Canadian dollars.
Certain metrics, including those expressed on an adjusted basis,
are non-IFRS and other financial measures. See “ Non-IFRS and Other
Financial Measures” below.
RECENTS HIGHLIGHTS
- Rights
Offering: On May 11, 2022,
the Company closed an oversubscribed rights offering for common
shares of Razor (“Common Shares”) issued on a “flow-through” basis
within the meaning of the Income Tax Act (Canada). A total of
23,314,466 rights were exercised, resulting in the issuance of
1,960,784 Common Shares for gross proceeds of approximately $5.0
million. The Company intends to use the proceeds to fund certain
eligible expenses yet to be incurred for its co-produced Geothermal
Power Generation Project in Swan Hills, Alberta (“Geothermal
Project”), and eligible expenses on various early stage power
projects including additional geothermal initiatives.
Q1 2022 FINANCIAL AND OPERATIONAL
HIGHLIGHTS
-
Production: Averaged 4,457 boe/d
in Q1 2022, representing a 48% increase from Q1 2021 and a 2%
increase from Q4 2021.
- Adjusted Funds
Flow1: Generated
adjusted funds flow of $9.7 million ($0.41/share (basic and
diluted)) in Q1 2022, representing an increase of $10.5 million
from Q1 2021 and an increase of $7.3 million from Q4 2021 driven by
improved operating netbacks and higher production.
- Operating
Netback1: Achieved an
operating netback of $26.00/boe in Q1 2022, compared to ($0.66/boe)
in Q1 2021 and $8.93/boe in Q4 2021.
- Geothermal
Project: The fully financed Geothermal
Project is in the final construction phase. The Geothermal Project
will be capable of generating up to 21 MW of grid connected power,
of which up to 30% will be sustainable clean power generation.
- Net
Debt1: Net debt was
reduced by $2.1 million in Q1 2022 to $96.9 million and further
reductions are expected over the balance of the year.
1) Refer to "Non-IFRS and other financial
measures.”
NEAR AND MEDIUM-TERM
OBJECTIVES
- Safely execute our production
enhancement programs and Geothermal Project.
- Reduce net debt through a measured
investment in production enhancement while continuing to optimize
operational and administrative costs.
- Actively identify and consider
asset acquisitions and business combinations with other oil and gas
producers, energy related service companies, and lower carbon
electricity producers and technologies.
SELECT QUARTERLY HIGHLIGHTSThe
following tables summarizes key financial and operating highlights
associated with the Company’s financial performance.
|
|
Three Months Ended Mar 31, |
|
($000's, except for per share amounts and production) |
|
2022 |
|
2021 |
|
Production |
|
|
|
Light Oil (bbl/d) |
|
2,830 |
|
1,952 |
|
Natural gas (mcf/d) 1 |
|
4,350 |
|
3,741 |
|
NGL (boe/d) |
|
902 |
|
434 |
|
Total (boe/d) |
|
4,457 |
|
3,009 |
|
Sales volumes |
|
|
|
Light Oil (bbl/d) |
|
2,876 |
|
1,907 |
|
Natural gas (mcf/d)1 |
|
3,906 |
|
3,463 |
|
NGL (bbl/d) |
|
902 |
|
434 |
|
Total (boe/d) |
|
4,429 |
|
2,918 |
|
Oil inventory volumes (bbls) |
|
11,058 |
|
12,197 |
|
Revenue |
|
|
|
Oil and NGLs sales |
|
32,924 |
|
12,367 |
|
Natural gas sales |
|
1,710 |
|
1,017 |
|
Blending and processing income |
|
903 |
|
1,368 |
|
Other revenue |
|
482 |
|
403 |
|
Total
revenue |
|
36,019 |
|
15,155 |
|
Cash flows from operating
activities |
|
2,404 |
|
(3,518 |
) |
Funds flow 2 |
|
9,883 |
|
(1,424 |
) |
Adjusted funds flow 2 |
|
9,661 |
|
(863 |
) |
Net (loss) |
|
(776 |
) |
(5,635 |
) |
Per share – basic and diluted |
|
(0.03 |
) |
(0.27 |
) |
Weighted average number of shares outstanding (basic and
diluted) |
|
23,314 |
|
21,064 |
|
Netback ($/boe) 2 |
|
|
|
|
Oil and gas sales |
|
86.34 |
|
49.43 |
|
Royalties |
|
(19.03 |
) |
(4.66 |
) |
Adjusted net operating expenses 2 3 |
|
(32.99 |
) |
(35.09 |
) |
Production enhancement expenses 2 |
|
(7.50 |
) |
(7.98 |
) |
Transportation and treating |
|
(2.39 |
) |
(2.36 |
) |
Realized derivative gain (loss) on settlement |
|
1.57 |
|
- |
|
Operating netback 2 |
|
26.00 |
|
(0.66 |
) |
1) Natural gas production
includes internally consumed natural gas primarily used in power
generation.2) Refer to "Non-IFRS and other
financial measures".3) Excludes production
enhancement expenses incurred in the period.
|
March 31, |
|
December 31, |
|
($000's, except for share amounts) |
2022 |
|
2021 |
|
Total assets |
225,255 |
|
239,166 |
|
Cash |
9,000 |
|
2,841 |
|
Long-term debt
(principal) |
84,003 |
|
73,192 |
|
Net debt 1 |
96,940 |
|
99,020 |
|
Number
of shares outstanding |
23,314,466 |
|
23,314,466 |
|
1) Refer to "Non-IFRS and other
financial measures".
FIRST QUARTER OPERATIONAL UPDATE
Production volumes for the first quarter of 2022
averaged 4,457 boe/d, representing an increase of 48% from
production volumes in the first quarter of 2021 and a 2% production
increase from the last quarter of 2021. Highlights of the causes
for the increase in production volumes from Q1 2021 to Q1 2022 are
as follows:
- Swan Hills –
production volumes increased 79% from Q1 2021. Production in Q1
2022 was positively impacted by increased production as a result of
the working interest acquisition of Swan Hills Unit No.1 in August
2021.
The Company is continuing with its production
enhancement program beginning in Q2 2022, to increase production in
Swan Hills. In addition, the operator in Swan Hills Unit No.1 has
embarked on various production enhancement activities and the
Company anticipates these production enhancement activities will
continue throughout 2022.
- Kaybob –
production volumes increased 9% from the same period in 2021 as the
Company’s production enhancement program focused in the Kaybob area
in March and April 2022.
- Southern Alberta –
production volumes decreased 1% from Q1 2021 primarily due to
natural production declines. The Company is conducting a small
production enhancement program in Q2 2022.
Adjusted net operating expenses1 increased $3.4
million or 32% on a total dollar basis and decreased 6% on a per
boe basis in Q1 2022 compared to the same period in 2021. The
increase in the adjusted net operating expense on a total dollar
basis was due primarily to fuel and electricity costs which
increased $1.9 million in Q1 2022 as compared to Q1 2021, surface
repairs and maintenance costs which increased $0.6 million in Q1
2022 as compared to Q1 2021 and labour costs which increased $0.2
million in Q1 2022 as compared to Q1 2021. Adjusted net operating
expenses on a per boe basis in Q1 2022 were $2.09/boe lower than Q1
2021 due to higher production boe/d rates in Q1 2022 compared to Q1
2021.
The primary factors affecting operating costs on
a $/boe basis are production levels, workover activity and
electricity pricing. Inherent within the Company’s hydrocarbon
operations is a prominent fixed cost element, or those costs that
are not correlated to production levels. On a relative basis these
costs are higher with lower production. Razor’s reactivation
program continued during Q1 2022 and will extend into 2022 with the
majority of the costs being expensed. Furthermore, the electricity
market has seen a continual rise in prices, that has recently
stabilized.
1) Refer to "Non-IFRS and other
financial measures.”
CAPITAL EXPENDITURESDuring Q1
2022, Razor invested $0.3 million in upstream oil and gas projects,
$0.4 million in oilfield services equipment and $3.6 million in the
Geothermal Project ($4.7 million less $1.1 million of government
grants).
OUTLOOKRazor
Razor continues to look forward and plan for the
future while remaining focused on its long-term sustainability. The
Company has an extensive opportunity set of high-quality wells
requiring reactivation, many of which have payout metrics which
exceed the Company’s economic thresholds. Razor will continue the
production enhancement activity throughout 2022. Most activities
involve repairs and maintenance work which will be expensed for
accounting purposes and operating netbacks will be reduced during
this timeframe. In aggregate, the annual base decline of these
wells is anticipated to be consistent with the
Company’s current corporate rate of approximately
12%.
The Company continues to focus on cost control
on its operated properties. In addition to the planned production
enhancement program, Razor will take a cautious and case-by-case
approach to capital spending in 2022, focusing on low risk, capital
efficient investment opportunities to increase field efficiencies
and corporate netbacks.
The significant improvement in oil prices thus
far in 2022 combined with a strong price outlook in the medium
term, provides Razor with improved cash flow from operations and
the Company anticipates reducing its net debt throughout 2022.
Razor has high reservoir quality, low decline,
isolate carbonate Swan Hills reef light oil pools that contain
large original oil in place with over 60 years of production
history. Razor believes these reefs are ideally suited for carbon
capture, utilization and storage (“CCUS”) and enhanced oil recovery
(“EOR”) purposes1, in addition to geothermal power production and
conventional open-hole horizontal development drilling
upside.
Razor recognizes multiple deep value streams in
its assets and is actively engaged in liberating them for the
benefit of shareholders.
________________________1 These programs have
been successfully demonstrated by the previous operator’s South
Swan Hills Unit CO2 EOR Injection Pilot which ran from 2008 to 2010
in addition to CO2 injection programs carried out in the Swan Hills
Unit No. 1 and Judy Creek oil pools from 2004 to 2010.
FutEra
In May 2021, FutEra, a wholly owned subsidiary
of Razor entered the project execution stage of its Geothermal
Project. On March 9, 2022, FutEra announced that it is fully
financed and in final construction of the Geothermal Project, of
which up to 30% will be sustainable clean power generation. FutEra
has successfully partnered with provincial and federal government
agencies to invigorate the emerging geothermal industry. To date,
Razor has received $14.1 million in government grants to support
this power generation project. The total construction and
commissioning budget for the Geothermal Project is $42.0
million.
Legacy oil and gas fields face economic
challenges with lower production levels and high fixed costs.
However, these fields also have practical advantages when
considering the existing infrastructure, pipelines, wells and
operational footprints. To meet the objectives of creating lower
carbon electricity and leveraging oil and gas operations, FutEra
and Razor have successfully designed a geothermal/natural gas
hybrid power plant in an operational oil and gas facility. Razor
and FutEra continue to demonstrate the synergies and cooperation
needed to define a type of transition energy and sets the standard
of how traditional oil and gas companies can evolve into ‘energy
and technology’ companies necessary for the future of the Alberta
energy complex.
FutEra’s next phase of the Geothermal Project
will be the design and implementation of a Carbon Capture with
Usage and/or Sequestration (“CCUS”) solution with the objective to
create a net negative carbon emitting power generation
facility.
With Razor’s strategic acquisition of additional
working interest in the Swan Hills area in the third quarter of
2021, FutEra has identified the potential for additional geothermal
and/or natural gas power generation projects in Swan Hills Unit
No.1. The volume and temperature of the produced fluids processed
through two of the Unit’s main facilities are highly analogous to
FutEra’s current Geothermal Project.
FutEra has identified and is in the process of
reviewing and capturing additional projects including solar,
geothermal, CCUS and other low carbon technologies.
EXECUTIVE APPOINTMENTRazor has
appointed Michael Blair to the position of Chief Operating Officer
(“COO”). Mr. Blair is a Professional Engineer with over 20 years’
experience in the oil and gas upstream industry. With a particular
focus on production and operations, Mr. Blair has worked within
organizations such as Baker Hughes, Penn West, Legacy Oil + Gas,
Ventura Resources, and Sproule. Mr. Blair has direct operational
experience with Razor’s Swan Hills assets.
The Company also announces that Frank Muller has
retired from the COO and Senior Vice President roles due to health
reasons. Mr. Muller is a founder and Director of Razor, and a
steadfast partner in our success. Mr. Muller will continue in the
capacity as a Director of Razor.
GRANT OF INCENTIVE STOCK
OPTIONSThe Company also announces the granting of 167,000
incentive stock options ("Options") to acquire Common Shares under
the Company’s stock option plan. An aggregate of 117,000 Options
were granted to certain officers and 50,000 Options were granted to
certain employees.
All of the Options are exercisable for a period
of five years at an exercise price of $3.25 per Common Share, which
is a premium to the last closing price of $3.07 of the Common
Shares on the TSX Venture Exchange. One-third of the Options will
vest on the date that is one year after the date of the grant of
such Options and the remainder will vest one-third per year
thereafter.
About Razor
Razor is a publicly traded junior oil and gas
development and production company headquartered in Calgary,
Alberta, concentrated on acquiring, and subsequently enhancing, and
producing oil and gas from properties primarily in Alberta. The
Company is led by experienced management and a strong, committed
Board of Directors, with a long-term vision of growth focused on
efficiency and cost control in all areas of the business. Razor
currently trades on TSX Venture Exchange under the ticker
“RZE.V”.
www.razor-energy.com
About FutEra
FutEra leverages Alberta’s resource industry
innovation and experience to create transitional power and
sustainable infrastructure solutions to commercial markets and
communities, both in Canada and globally. Currently, it is
developing a 21 MW co-produced geothermal and natural gas hybrid
power project in Swan Hills, Alberta.
www.futerapower.com
About Blade
Blade Energy Services is a subsidiary of Razor.
Operating in west central Alberta, Blade’s primary services include
fluid hauling, road maintenance, earth works including well site
reclamation and other oilfield services.
www.blade-es.com
For
additional information please contact: |
Doug BaileyPresident and Chief Executive Officer |
Kevin BraunChief Financial Officer |
|
|
Razor Energy Corp.800, 500-5th
Ave SW Calgary Alberta T2P 3L5Telephone: 403-262-0242 |
|
|
|
READER
ADVISORIES
FORWARD-LOOKING STATEMENTS:
This press release may contain certain statements that may be
deemed to be forward-looking statements. Such statements relate to
possible future events, including, but not limited to, the
Company’s objectives and anticipated results, including the
Company’s capital program and other activities; the Geothermal
Project and its capacity, construction and commissioning budget;
opportunities for power generation, oil blending and services
integration; restarting wells; execution of production enhancement
programs; future rates of production; expectations regarding
commodity prices, cash flow from operating activities, working
capital and net debt; possible business combination transactions;
and future projects including solar, wind and other low carbon
technologies. All statements other than statements of historical
fact may be forward-looking statements. Forward-looking statements
are often, but not always, identified by the use of words such as
“anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”,
“will”, “should”, “continue”, “may”, “objective” and similar
expressions. The forward-looking statements are based on certain
key expectations and assumptions made by the Company, including but
not limited to expectations and assumptions concerning the
availability of capital, current legislation, receipt of required
regulatory approvals, the timely performance by third-parties of
contractual obligation, the success of future geothermal, drilling
and development activities, the performance of existing wells, the
performance of new wells, the Company’s growth strategy, general
economic conditions, availability of required equipment and
services prevailing commodity prices, price volatility, price
differentials and the actual prices received for the Company's
products. Although the Company believes that the expectations and
assumptions on which the forward-looking statements are based are
reasonable, undue reliance should not be placed on the
forward-looking statements because the Company can give no
assurance that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, risks associated with the oil and gas industry and
geothermal electricity projects in general (e.g., operational risks
in development, exploration and production; delays or changes in
plans with respect to exploration or development projects or
capital expenditures; variability in geothermal resources; as the
uncertainty of reserve estimates; the uncertainty of estimates and
projections relating to production, costs and expenses, and health,
safety and environmental risks), electricity and commodity price
and exchange rate fluctuations, changes in legislation affecting
the oil and gas and geothermal industries and uncertainties
resulting from potential delays or changes in plans with respect to
exploration or development projects or capital expenditures. In
addition, the Company cautions that COVID-19 or other global
pandemics may have a material adverse effect on global economic
activity and worldwide demand for certain commodities, including
crude oil, natural gas and NGL, and may continue to result in
volatility and disruption to global supply chains, operations,
mobility of people and the financial markets, which could continue
to affect commodity prices, interest rates, credit ratings, credit
risk, inflation, business, financial conditions, results of
operations and other factors relevant to the Company. The duration
of the current commodity price volatility is uncertain. Please also
refer to the risk factors identified in the most recent annual
information form and management discussion and analysis of the
Company which are available on SEDAR at www.sedar.com. The
forward-looking statements contained in this press 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 so required by applicable securities laws.
This press release contains future-oriented
financial information and financial outlook information
(collectively, "FOFI") about Razor's prospective results of
operations, sales volumes, including sale of inventory volumes,
production and production efficiency, balance sheet, capital
spending, cost and net debt reductions, operating efficiencies,
investment infrastructure and components thereof, all of which are
subject to the same assumptions, risk factors, limitations, and
qualifications as a set forth in the above paragraph. FOFI
contained in this document was approved by management as of the
date of this document and was provided for the purpose of providing
further information about Razor's future business operations. Razor
disclaims any intention or obligation to update or revise any FOFI
contained in this document, whether as a result of new information,
future events or otherwise, unless required pursuant to applicable
law. Readers are cautioned that the FOFI contained in this document
should not be used for purposes other than for which it is
disclosed herein.
NON-IFRS AND OTHER FINANCIAL
MEASURES: This press release contains certain specified
measure consisting of non-IFRS measures and non-IFRS financial
ratios. Since these specified financial measures may not have a
standardized meaning, they must be clearly defined and, where
required, reconciled with their nearest IFRS measure. Accordingly,
they may not be comparable to similar measures used by other
companies
FUNDS FLOW AND ADJUSTED FUNDS
FLOW
Funds FlowManagement utilizes
funds flow as a useful measure of Razor’s ability to generate cash
not subject to short-term movements in non-cash operating working
capital. As shown below, funds flow is calculated as cash flow from
operating activities excluding change in non-cash working
capital.
Adjusted funds flowManagement
utilizes adjusted funds flow as a key measure to assess the ability
of the Company to generate the funds necessary for financing
activities, operating activities, and capital expenditures. As
shown below, adjusted funds flow is calculated as funds flow
excluding purchasing of commodity contracts, and decommissioning
expenditures since Razor believes the timing of collection, payment
or incurrence of these items involves a high degree of discretion
and variability. Expenditures on decommissioning obligations vary
from period to period depending on the maturity of the Company’s
operating areas and availability of adjusted funds flow and are
viewed as part of the Company’s capital budgeting process.
The following table reconciles cash flow
from operating activities, funds flow and adjusted funds
flow:
|
|
Three Months Ended March 31, |
|
($000’s) |
|
2022 |
|
2021 |
|
Cash flow from (used in) operating activities |
|
2,404 |
|
(3,518 |
) |
Changes
in non-cash working capital |
|
7,479 |
|
2,094 |
|
Funds flow |
|
9,883 |
|
(1,424 |
) |
Decommissioning costs
incurred |
|
318 |
|
53 |
|
Purchase (sale) of commodity contracts |
|
(540 |
) |
508 |
|
Adjusted funds
flow |
|
9,661 |
|
(863 |
) |
NET DEBT
Net debt is calculated as the sum of the
long-term debt (includes AIMCo Term Loan, Amended Arena Term Loan
and Promissory Notes) and lease obligations, less working capital
(or plus working capital deficiency), with working capital
excluding mark-to-market risk management contracts. Razor believes
that net debt is a useful supplemental measure of the total amount
of current and long-term debt of the Company.
Reconciliation of net debt |
March 31, |
|
December 31, |
|
($000’s) |
2022 |
|
2021 |
|
Long term debt |
(75,516 |
) |
(64,047 |
) |
Long
term lease obligation |
(680 |
) |
(435 |
) |
|
(76,196 |
) |
(64,482 |
) |
Less: Working capital |
|
|
Current assets |
34,031 |
|
22,108 |
|
Exclude commodity
contracts |
2,826 |
|
573 |
|
Current liabilities |
(57,601 |
) |
(57,219 |
) |
|
(20,744 |
) |
(34,538 |
) |
Net debt |
96,940 |
|
99,020 |
|
Adjusted operating
expensesAdjusted operating expenses are regular field or
general operating costs that occur throughout the year and do not
include production enhancement expenses. Management believes that
removing the expenses related to production enhancements from total
operating expenses is a useful supplemental measure to analyze
regular operating expenses.
Production enhancement
expensesProduction enhancement expenses are expenses made
by the Company to increase production volumes which are not regular
field or general operating costs that occur throughout a year.
Management believes that separating the expenses related to
production enhancements is a useful supplemental measure to analyze
the cost of bringing wells back on production and the related
increases in production volumes.
Reconciliation of Adjusted Operating
expenses, Production Enhancement Expenses and Operating
Expenses
|
|
Three Months Ended March 31, |
|
($000's) |
|
2022 |
|
2021 |
|
Adjusted operating expenses |
|
13,812 |
|
10,428 |
|
Production enhancement expenses |
|
3,010 |
|
2,160 |
|
Operating Costs |
|
16,822 |
|
12,588 |
|
Adjusted Net Operating
ExpensesAdjusted net operating expenses equals adjusted
operating expenses less net blending and processing income.
Management considers adjusted net operating expenses and important
measure to evaluate its operational performance.
|
|
Three Months Ended March 31, |
|
($000's) |
|
2022 |
|
2021 |
|
Adjusted net operating expenses |
|
13,812 |
|
10,428 |
|
Net
blending and processing income |
|
(579 |
) |
(927 |
) |
Adjusted net operating expenses |
|
13,233 |
|
9,501 |
|
NET BLENDING AND PROCESSING
INCOME
Net blending and processing income is calculated
by adding blending and processing income and deducting blending and
processing expense. Net blending and processing income may not be
comparable to similar measures used by other companies.
|
|
Three Months Ended March 31, |
|
($000's) |
|
2022 |
|
2021 |
|
Blending and processing income |
|
903 |
|
1,368 |
|
Blending and processing expenses |
|
(324 |
) |
(441 |
) |
Net blending and processing income |
|
579 |
|
927 |
|
OPERATING NETBACK
Operating netback is a measure that represents
sales net of royalties and operating expenses. Management believes
that operating netback is a useful supplemental measure to analyze
operating performance and provide an indication of the results
generated by the Company’s principal business activities prior to
the consideration of other income and expenses.
|
|
Three Months Ended March 31, |
|
($000's) |
|
2022 |
|
2021 |
|
Petroleum and natural gas sales1 |
|
34,634 |
|
13,384 |
|
Royalties |
|
(7,632 |
) |
(1,261 |
) |
Adjusted net operating
expenses |
|
(13,233 |
) |
(9,501 |
) |
Production enhancement
expenses |
|
(3,010 |
) |
(2,160 |
) |
Transportation and treating
expenses |
|
(957 |
) |
(638 |
) |
Realized derivative gain (loss) on settlement |
|
628 |
|
- |
|
Operating netback |
|
10,430 |
|
927 |
|
NON-IFRS AND FINANCIAL
RATIOS:
Operating expenses per
BOEOperating expenses per boe is consists of adjusted
operating expenses per boe and production enhancement expenses per
boe. Operating expense per boe is a useful supplemental measure to
calculate the efficiency of its operating expenses on a per unit of
production basis.
|
|
Three Months Ended March 31, |
|
($/boe)1 |
|
2022 |
|
2021 |
|
Adjusted operating expenses |
|
34.43 |
|
38.51 |
|
Production enhancement expenses |
|
7.50 |
|
7.98 |
|
Operating Expenses |
|
41.93 |
|
46.49 |
|
1) $/boe amounts are calculated using production volumes. |
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
($/boe)1 |
|
2022 |
|
2021 |
|
Adjusted operating expenses |
|
34.43 |
|
38.51 |
|
Net
blending and processing income |
|
(1.44 |
) |
(3.42 |
) |
Adjusted net operating expenses |
|
32.99 |
|
35.09 |
|
1) $/boe amounts are calculated using production volumes. |
|
|
|
|
|
Operating Netback per
BoeOperating netback per boe is used to calculate the
results of Razor’s operating efficiency of its petroleum and
natural gas assets on a per unit of production basis. Net operating
expense per boe is a useful supplemental measure to analyze
operating performance and provide an indication of the results
generated by the Company’s principal business activities prior to
the consideration of other income and expenses.
|
|
Three Months Ended March 31, |
|
($/boe) |
|
2022 |
|
2021 |
|
Oil and gas sales1 |
|
86.34 |
|
49.43 |
|
Royalties |
|
(19.03 |
) |
(4.66 |
) |
Adjusted operating
expenses |
|
(32.99 |
) |
(35.09 |
) |
Production enhancement
expenses |
|
(7.50 |
) |
(7.98 |
) |
Transportation and
treating |
|
(2.39 |
) |
(2.36 |
) |
Realized derivative gain (loss) on settlement |
|
1.57 |
|
- |
|
Operating netback per Boe |
|
26.00 |
|
(0.66 |
) |
1) Natural gas production includes internally consumed natural gas
primarily used in power generation. |
|
|
|
ADVISORY PRODUCTION
INFORMATION: Unless otherwise indicated herein, all
production information presented herein is presented on a gross
basis, which is the Company's working interest prior to deduction
of royalties and without including any royalty interests.
BARRELS OF OIL EQUIVALENT:The
term "boe" or barrels of oil equivalent 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. Additionally, 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 ratio of 6:1 may be misleading as an
indication of value.
Neither the
TSX
Venture
Exchange
nor its
Regulation
Services
Provider
(as that
term is
defined in the
policies of the
TSX
Venture
Exchange)
accepts
responsibility for the adequacy
or accuracy of this
news release.
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