Breaking News Bar

Business News and Information

Petro-Reef Resources Ltd. Announces 2012 Q2 Financial and Operating Results

CALGARY, ALBERTA -- (Marketwire) -- 08/29/12 -- Petro-Reef Resources Ltd. (TSX VENTURE: PER), ("Petro-Reef" or the "Company") is pleased to release its financial and operating results for the three and six month periods ended June 30, 2012. This press release should be read in conjunction with the Company's June 30, 2012 quarterly financial statements and MD&A filed on Sedar.


Financial Summary

----------------------------------------------------------------------------
                                      Three months ended June 30
----------------------------------------------------------------------------
                                             2012           2011   % Change
----------------------------------------------------------------------------

Oil and gas revenue                  $  2,522,702   $  2,249,472         12
Cash flow from operations (1)             511,217        953,248        (46)
Per share - basic and diluted                0.01           0.02        (52)
Net income                                926,424          1,363          -
Per share - basic and diluted                0.01           0.00          -
Net debt (1)                           12,695,625     13,793,310         (8)
Capital expenditures                 $    756,242   $  2,368,000        (68)
Shares outstanding - end of period     62,239,477     56,261,477         11
----------------------------------------------------------------------------


----------------------------------------------------------------------------
                                        Six months ended June 30
----------------------------------------------------------------------------
                                             2012           2011   % Change
----------------------------------------------------------------------------
Oil and gas revenue                  $  5,378,595   $  5,371,751          0
Cash flow from operations (1)           1,738,981      2,587,396        (33)
Per share - basic and diluted                0.03           0.05        (44)
Net income (loss)                         815,042     (1,052,232)         -
Per share - basic and diluted                0.01          (0.02)         -
Net debt (1)                           12,695,625     13,793,310         (8)
Capital expenditures                 $  1,602,074   $  5,996,000        (73)
Shares outstanding - end of period     62,239,477     56,261,477         11
----------------------------------------------------------------------------

(1) Non GAAP measure

Daily Production and Commodity Prices
----------------------------------------------------------------------------

Three months ended June 30                          2012      2011 % Change
----------------------------------------------------------------------------
Daily production
Oil and NGLs (bbl/d)                                 341       163      109
Natural gas (mcf/d)                                1,866     2,555      (27)
----------------------------------------------------------------------------
Oil equivalent (boe/d @ 6:1)                         652       589       11
----------------------------------------------------------------------------
Realized commodity prices ($CDN)
Oil and NGLs (bbl)                                 68.88     91.68      (25)
Natural gas (mcf)                                   2.28      3.81      (40)
----------------------------------------------------------------------------
Oil equivalent (boe @ 6:1)                         41.53     42.15       (1)
----------------------------------------------------------------------------

Average prices for oil and gas dropped sharply in Q2 2012 as the average oil price dropped 25% and the average gas price fell by 40%.However, the average price per boe remained level as oil production increased to 52% of total production from 28% in Q2 2011.

Daily production volumes increased by 11% to 652 boe/d in the three months ended June 30, 2012 as compared to 589 boe/d for the same period in 2011. Oil volumes increased by 109% quarter over quarter while gas production decreased by 27%. In Q2 2012 oil and NGL production comprised 52% of total production as compared to 28% in Q2 2011.


----------------------------------------------------------------------------
Six months ended June 30                        2012        2011   % Change
----------------------------------------------------------------------------
Daily production
Oil and NGLs (bbl/d)                             325         229         42
Natural gas (mcf/d)                            2,303       2,808        (18)
----------------------------------------------------------------------------
Oil equivalent (boe/d @ 6:1)                     709         697          2
----------------------------------------------------------------------------
Realized commodity prices ($CDN)
Oil and NGLs (bbl)                             75.19       81.06         (7)
Natural gas (mcf)                               2.28        3.94        (42)
----------------------------------------------------------------------------
Oil equivalent (boe @ 6:1)                     41.42       42.72         (3)
----------------------------------------------------------------------------

Average prices for oil and gas decreased in the six months ended June 30, 2012 as the average oil price dropped 7% and the average gas price fell by 42%.However, the average price per boe only decreased by 3% as oil production increased by 42% as compared to the same period in 2011.

Daily production volumes increased by 2% to 709 boe/d in the six months ended June 30, 2012 as compared to 697 boe/d for the same period in 2011. Oil volumes increased by 42% while gas production decreased by 18%. In the six months ended June 30, 2012 oil and NGL production comprised 46% of total production as compared to 33% in 2011.


Revenue by product

Three months ended June 30                      2012        2011   % Change
----------------------------------------------------------------------------

CDN $
Oil revenue                                2,134,766   1,365,342         56
Natural gas revenue                          387,936     884,130        (56)
----------------------------------------------------------------------------
Total revenue                              2,522,702   2,249,472         12
----------------------------------------------------------------------------

In Q2 2012 oil revenues comprised 85% of total revenue as compared to 61% in Q2 2011. Oil revenue increased by 56% while natural gas revenue decreased by 56%.


Six months ended June 30                        2012        2011   % Change
----------------------------------------------------------------------------

CDN $
Oil revenue                                4,429,626   3,427,498         29
Natural gas revenue                          948,969   1,944,254        (51)
----------------------------------------------------------------------------
Total revenue                              5,378,595   5,371,752          0
----------------------------------------------------------------------------

For the six months ended June 30, 2012 oil revenues comprised 82% of total revenue as compared to 64% in the same period in 2011. Oil revenue increased by 29% while natural gas revenue decreased by 51%.


Earnings and Cash Flow Summary

Three months ended                            %                           %
 June 30                 2012      2011  Change      2012      2011  Change
CDN $                                             ($/boe)   ($/boe)
----------------------------------------------------------------------------
Gross Revenue       2,522,702 2,249,472      12     41.53     42.15      (1)
Royalties            (347,700) (369,899)     (6)    (5.72)    (6.93)    (17)
----------------------------------------------------------------------------
Revenue after
 royalties          2,175,002 1,879,573      16     35.81     35.22       2
Operating expenses    827,282   831,653      (1)    13.62     15.58     (13)
----------------------------------------------------------------------------
Operating netback
 (1)                1,347,720 1,047,920      29     22.19     19.64      13
Realized gain (loss)
 on financial
 derivative
 instruments          (19,354)  304,819       -     (0.32)     5.71       -
General &
 administrative
 expenses             660,246   303,152     118     10.87      5.68      91
Interest expense      156,903    96,339      63      2.58      1.81      43
----------------------------------------------------------------------------
Cash flow from
 operations (1)       511,217   953,248     (46)     8.42     17.86     (53)
Unrealized gain
 (loss) on financial
 derivative
 instruments        1,594,928   394,883     304     26.26      7.40       -
Other income                -         -       -      0.00      0.00
Stock based
 compensation          33,208   192,717     (83)     0.55      3.61     (85)
Accretion              10,996    17,386     (37)     0.18      0.33     (44)
Depletion and
 depreciation       1,135,517 1,229,832      (8)    18.70     23.04     (19)
----------------------------------------------------------------------------
Income before income
 taxes                926,424   (91,804)      -     15.25     (1.72)      -
Deferred income tax
 (recovery)                 -   (93,167)      -      0.00     (1.75)      -
----------------------------------------------------------------------------
Net Income            926,424     1,363       -     15.25      0.03       -
----------------------------------------------------------------------------
Per Share - Basic        0.01      0.00
Per Share - Diluted      0.01      0.00
----------------------------------------------------------------------------

Six months ended June                             %                       %
 30                         2012       2011  Change    2012    2011  Change
CDN $                                               ($/boe) ($/boe)
----------------------------------------------------------------------------
Gross Revenue          5,378,595  5,371,751       0   41.42   42.72      (3)
Royalties               (623,225)  (882,957)    (29)  (4.80)  (7.02)    (32)
----------------------------------------------------------------------------
Revenue after royalties4,755,370  4,488,794       6   36.62   35.70       3
Operating expenses     1,646,413  1,677,727      (2)  12.68   13.34      (5)
----------------------------------------------------------------------------
Operating netback (1)  3,108,957  2,811,067      11   23.94   22.36       7
Realized gain (loss) on
 financial derivative
 instruments            (117,292)   479,954       -   (0.90)   3.82       -
General &
 administrative
 expenses                961,284    507,876      89    7.40    4.04      83
Interest expense         291,400    195,749      49    2.24    1.56      44
----------------------------------------------------------------------------
Cash flow from
 operations (1)        1,738,981  2,587,396     (33)  13.39   20.58     (35)
Unrealized gain (loss)
 on financial
 derivative instruments1,523,909   (508,790)      -   11.74   (4.05)      -
Other income             230,252    250,919      (8)   1.77    2.00     (11)
Stock based
 compensation            120,579    333,253     (64)   0.93    2.65     (65)
Accretion                 21,960     34,329     (36)   0.17    0.27     (38)
Depletion and
 depreciation          2,535,561  2,867,450     (12)  19.53   22.80     (14)
----------------------------------------------------------------------------
Income (loss) before
 income taxes            815,042   (905,507)      -    6.28   (7.20)      -
Deferred income tax
 expense                       -    146,725       -    0.00    1.17       -
----------------------------------------------------------------------------
Net Income (loss)        815,042 (1,052,232)      -    6.28   (8.37)      -
----------------------------------------------------------------------------
Per Share - Basic           0.01      (0.02)
Per Share - Diluted         0.01      (0.02)
----------------------------------------------------------------------------
(1) Non-GAAP measure

Forward-Looking Statements: All statements, other than statements of historical fact, set forth in this news release, including without limitation, assumptions and statements regarding reservoirs, resources and reserves, future production rates, exploration and development results, financial results, and future plans, operations and objectives of the Corporation are forward-looking statements that involve substantial known and unknown risks and uncertainties. Some of these risks and uncertainties are beyond management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, environmental risks, industry competition, availability of qualified personnel and management, availability of materials, equipment and third party services, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by the Corporation at the time of preparation, may prove to be incorrect. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

Reference is made to barrels of oil equivalent (BOE). Barrels of oil equivalent may be misleading, particularly if used in isolation. In accordance with National Instrument 51-101, a BOE conversion ratio for natural gas of 6 Mcf: 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.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts:
Petro-Reef Resources Ltd.
Hugh M. Thomson
Vice-President Finance and Chief Financial Officer
(403) 523-2505
(403) 264-1348 (FAX)

Petro-Reef Resources Ltd.
970, 10655 Southport Road S.W.
Calgary, Alberta T2W 4Y1
info@petro-reef.ca
www.petro-reef.ca

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
 
bottom clear