CALGARY, ALBERTA--(Marketwired - Feb. 12, 2015) - Bengal Energy Ltd. (TSX:BNG) ("Bengal" or the "Company") announced today its financial and operating results for the third fiscal quarter of 2015 (period ended December 31, 2014).
FISCAL Q3 2015 HIGHLIGHTS:
During the Company's third fiscal quarter of 2015, Bengal continued to execute its growth strategy with the drilling of six wells in its Phase Two drilling program at its Cuisinier asset in the Cooper Basin, Australia. The current drilling program builds on Bengal's past drilling success in its large oil-in-place Cuisinier pool in Australia, which generates ultra-light oil production. In addition to Cuisinier, which is a development stage asset, the Company is also pursuing appraisal and exploration assets expected to fuel future growth.
The following is an overview of the financial and operational results during the three-month period ended December 31, 2014:
Financial Summary:
(1) Funds flow from operations is an additional generally accepted account principle ("GAAP measure"). The comparable International Financial Reporting Standards ("IFRS") measure is cash from operations. A reconciliation of the two measures can be found in the table on page 6 of Bengal's Annual MD&A.
Operating Overview:
"We are extremely pleased with the initial results of our calendar 2014 drilling program to-date," said Chayan Chakrabarty, Bengal's President and CEO. "Our fortuitous hedging position provides Bengal with a very favorable corporate netback of approximately CAD$ $35 to $40 /bbl at current market prices that will allow us to remain flexible in the current low oil price environment. The Company continues to pursue our long-term growth strategy of developing our large oil-in-place Cuisinier pool in Australia, while providing new upside potential to our investors through our appraisal and exploration efforts in both Australia and onshore India."
For a discussion of the activities on each of the Company's permits, refer to Bengal's management's discussion and analysis for the third fiscal quarter 2015 ended December 31, 2014 filed on SEDAR at www.sedar.com.
FINANCIAL & OPERATING HIGHLIGHTS
$000s except per share, volumes and netback amounts | Three Months Ended | Nine Months Ended | ||||||||||||||
December 31 | December 31 | |||||||||||||||
2014 | 2013 | % Change | 2014 | 2013 | % Change | |||||||||||
Revenue | ||||||||||||||||
Oil | $ | 3,870 | $ | 5,451 | (29 | ) | $ | 12,036 | $ | 14,306 | (16 | ) | ||||
Natural gas | 63 | 53 | 19 | 223 | 187 | 19 | ||||||||||
Natural gas liquids | 11 | 12 | (8 | ) | 32 | 57 | (44 | ) | ||||||||
Total | $ | 3,944 | $ | 5,516 | (28 | ) | $ | 12,291 | $ | 14,550 | (16 | ) | ||||
Royalties | $ | 369 | $ | 365 | 1 | $ | 855 | $ | 927 | (8 | ) | |||||
% of revenue | 9.4 | 6.6 | 42 | 7.0 | 6.4 | 9 | ||||||||||
Operating & transportation | $ | 1,794 | $ | 1,365 | 31 | $ | 4,520 | $ | 3,794 | 19 | ||||||
Operating netback(1) | $ | 1,781 | $ | 3,786 | (53 | ) | $ | 6,916 | $ | 9,829 | (30 | ) | ||||
Cash from operations: | $ | 1,492 | $ | 2,170 | (47 | ) | $ | 5,943 | $ | 5,485 | 2 | |||||
Funds from operations:(2) | $ | 1,318 | $ | 2,862 | (66 | ) | $ | 3,703 | $ | 6,657 | (50 | ) | ||||
Per share ($) (basic & diluted) | 0.02 | 0.05 | (80 | ) | 0.06 | 0.11 | (55 | ) | ||||||||
Net (loss) / income | $ | (1,293 | ) | $ | 573 | 228 | $ | (2,120 | ) | $ | 1,954 | (46 | ) | |||
Per share ($) (basic & diluted) | (0.02 | ) | 0.01 | 200 | (0.03 | ) | 0.03 | (33 | ) | |||||||
Capital expenditures | $ | 4,489 | $ | 6,462 | (31 | ) | $ | 11,053 | $ | 14,599 | (24 | ) | ||||
Volumes | ||||||||||||||||
Oil (bopd) | 546 | 463 | 18 | 434 | 420 | 3 | ||||||||||
Natural gas (mcfpd) | 180 | 184 | (2 | ) | 181 | 208 | (13 | ) | ||||||||
Natural gas liquids (boepd) | 2 | 2 | - | 1 | 2 | (50 | ) | |||||||||
Total (boepd @ 6:1) | 578 | 496 | 17 | 465 | 457 | 2 | ||||||||||
Netback(1) ($/boe) | ||||||||||||||||
Revenue | $ | 74.17 | $ | 121.11 | (39 | ) | $ | 96.82 | $ | 115.84 | (17 | ) | ||||
Realized gain on financial instrument | 3.27 | - | - | 1.37 | - | - | ||||||||||
Royalties | 6.94 | 8.01 | (13 | ) | 6.74 | 7.38 | (10 | ) | ||||||||
Operating & transportation | 33.74 | 29.97 | 13 | 35.61 | 30.21 | 17 | ||||||||||
Netback/boe | $ | 36.79 | $ | 83.13 | (56 | ) | $ | 55.39 | $ | 78.28 | (29 | ) | ||||
(1) Operating netback is a non-IFRS measure. Netback per boe is calculated by dividing the revenue and less royalties, operating and transportation costs by the total production of the Company measured in boe. |
(2) Funds from operations is a non-IFRS measure. The comparable IFRS measure is cash from operations. A reconciliation of the two measures can be found in the table on page 6. |
Bengal has filed its consolidated financial statements and management's discussion and analysis for the third fiscal 2015 quarter ended December 31, 2014 with Canadian securities regulators. The documents are available on SEDAR at www.sedar.com or by visiting Bengal's website at www.bengalenergy.ca.
About Bengal
Bengal Energy Ltd. (TSX:BNG) is an international oil and gas exploration and production company with producing and prospective light oil‐weighted assets in Australia and India. Bengal offers exposure to lower risk, current production and cash flow, combined with longer‐term high, potential impact exploration projects. The Company's strategy is to achieve per share growth in cash flow, production and reserves while establishing an attractive portfolio of future drilling and exploration opportunities. Additional information is available on our website at www.bengalenergy.ca.
Forward-Looking Statements
This news release contains certain forward-looking statements or information ("forward-looking statements") as defined by applicable securities laws that involve substantial known and unknown risks and uncertainties, many of which are beyond Bengal's control. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward looking statements. The use of any of the words "plan", "expect", "prospective", "project", "intend", "believe", "should", "anticipate", "estimate", or other similar words or statements that certain events "may" or "will" occur are intended to identify forward-looking statements. The projections, estimates and beliefs contained in such forward looking statements are based on management's estimates, opinions, and assumptions at the time the statements were made, including assumptions relating to: the impact of economic conditions in North America, Australia, India and globally; industry conditions; changes in laws and regulations including, without limitation, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; stock market volatility and fluctuations in market valuations of companies with respect to announced transactions and the final valuations thereof; results of exploration and testing activities; and the ability to obtain required approvals and extensions from regulatory authorities. We believe the expectations reflected in those forward-looking statements are reasonable but, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Bengal will derive from them. As such, undue reliance should not be placed on forward-looking statements.
Forward-looking statements contained herein include, but are not limited to, statements regarding: the commencement of production of the Phase Two development wells, the timing and completion of remediation at Cuisinier-6 and the timing of the onshore India drilling campaign. The forward looking statements contained herein are subject to numerous known and unknown risks and uncertainties that may cause Bengal's actual financial results, performance or achievement in future periods to differ materially from those expressed in, or implied by, these forward-looking statements, including but not limited to, risks associated with: the failure to obtain required regulatory approvals or extensions; failure to satisfy the conditions under farm-in and joint venture agreements; failure to secure required equipment and personnel; changes in general global economic conditions including, without limitations, the economic conditions in North America, Australia, India; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; changes in laws and regulations including, without limitation, the adoption of new environmental and tax laws and regulations and changes in how they are interpreted and enforced; the results of exploration and development drilling and related activities; the ability to access sufficient capital from internal and external sources; and stock market volatility. Readers are encouraged to review the material risks discussed in Bengal's Annual Information Form under the heading "Risk Factors" and in Bengal's annual MD&A under the heading "Risk Factors". The Company cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking statements contained in this news release speak only as of the date hereof and Bengal does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be require pursuant to applicable securities laws..
Barrels of Oil Equivalent
When converting natural gas to equivalent barrels of oil, Bengal uses the widely recognized standard of 6 thousand cubic feet (mcf) to one barrel of oil (boe). However, a boe may be misleading, particularly if used in isolation. A boe conversion ratio of 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.
Certain Defined Terms
boe - barrels of oil equivalent
boe/d - barrels of oil equivalent per day
bbl - barrel
bbl/d - barrels per day
mcf - thousand cubic feet
mcf/d - thousand cubic feet per day
Non-IFRS Measurements
Within this release references are made to terms commonly used in the oil and gas industry. Funds from operations, funds from operations per share and netbacks do not have any standardized meaning under International Financial Reporting Standards (IFRS) and previous generally accepted accounting principles (GAAP) and are referred to as non-IFRS measures. Funds from operations per share is calculated based on the weighted average number of common shares outstanding consistent with the calculation of net income (loss) per share. Netbacks equal total revenue less royalties and operating and transportation expenses calculated on a boe basis. Management utilizes these measures to analyze operating performance. The Company's calculation of the non-IFRS measures included herein may differ from the calculation of similar measures by other issuers. Therefore, the Company's non-IFRS measures may not be comparable to other similar measures used by other issuers. Funds from operations is not intended to represent operating profit for the period nor should it be viewed as an alternative to operating profit, net income, cash flow from operations or other measures of financial performance calculated in accordance with IFRS. Non-IFRS measures should only be used in conjunction with the Company's annual audited and interim financial statements. A reconciliation of these measures can be found in the table on page 6 of Bengal's Q3 fiscal 2014 MD&A.
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