CALGARY, ALBERTA--(Marketwired - March 3, 2016) - Crew Energy Inc. (TSX:CR) of Calgary, Alberta ("Crew" or the "Company") is pleased to announce our operating and financial results for the three and twelve month periods ended December 31, 2015. Our full audited consolidated Financial Statements and Notes, as well as Management's Discussion and Analysis ("MD&A") for the year ended December 31, 2015 will be available on Crew's website and filed on SEDAR at www.sedar.com.
FINANCIAL & OPERATING HIGHLIGHTS:
($ thousands, except per share amounts)
|Three months ended
Dec. 31, 2015
|Three months ended
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2014
|Petroleum and natural gas sales||34,532||72,295||153,934||425,424|
|Funds from operations(1)||19,601||33,035||82,363||171,592|
|Per share - basic||0.14||0.27||0.60||1.40|
|Net income (loss)||(8,167)||(28,424)||(55,355)||(349,714)|
|Per share - basic||(0.06)||(0.23)||(0.40)||(2.86)|
|Exploration and Development expenditures||42,067||81,447||246,418||306,775|
|Property acquisitions (net of dispositions)||(36,644)||1,901||(85,441)||(252,478)|
|Net capital expenditures||5,423||83,348||160,977||54,297|
Dec. 31, 2015
Dec. 31, 2014
|Working capital deficiency(2)||10,737||57,722|
|Senior Unsecured Notes||146,679||146,110|
|Total Net Debt||238,396||253,736|
|Common Shares Outstanding (thousands)||141,067||123,429|
|(1) Funds from operations is calculated as cash provided by operating activities, adding the change in non-cash working capital, decommissioning obligation expenditures and accretion of deferred financing costs. Funds from operations is used to analyze the Company's operating performance and leverage. Funds from operations does not have a standardized measure prescribed by International Financial Reporting Standards and therefore may not be comparable with the calculations of similar measures for other companies.|
|(2) Working capital deficiency includes cash and cash equivalents plus accounts receivable less accounts payable and accrued liabilities.|
|(3) Includes the maximum available under the Company's bank facility combined with the total face value of the $150 million senior unsecured notes due in October 2020.|
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2014
|Light crude oil (bbl/d)||340||1,228||441||429|
|Heavy crude oil (bbl/d)||2,849||5,867||3,834||5,897|
|Natural gas liquids (bbl/d)||3,437||2,041||2,521||1,640|
|Natural gas (mcf/d)||84,479||70,397||70,474||63,300|
|Properties sold (boe/d) (1)||-||-||-||5,689|
|Oil equivalent (boe/d)||20,706||20,869||18,542||24,205|
|Average prices (1, 2)|
|Light & medium crude oil ($/bbl)||48.75||69.79||53.10||75.27|
|Heavy crude oil ($/bbl)||31.92||61.47||40.40||72.64|
|Natural gas liquids ($/bbl)||27.87||39.37||30.28||55.26|
|Natural gas ($/mcf)||2.04||3.66||2.37||4.78|
|Oil equivalent ($/boe)||18.13||37.65||22.74||48.15|
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2014
|Realized commodity hedging gain / (loss)||5.82||1.83||6.05||(2.63)|
|Interest on long-term debt||(2.16)||(2.02)||(2.45)||(2.32)|
|Funds from operations||10.29||17.20||12.17||19.42|
|Working interest wells||6.0||23.3||31.4||72.7|
|Success rate, net wells (%)||83||100%||97||99%|
|(1) Amounts for the year ended December 31, 2014 include 2,260 bbl/d of oil, 737 bbl/d of ngl and 16,149 mcf/d of natural gas which was sold during 2014.|
|(2) Average prices are before deduction of transportation costs and do not include gains and losses on financial instruments. Average prices for light oil, natural gas liquids and natural gas have been adjusted to reflect the impact of the production volumes sold as shown in Note 1.|
|(3) Netback figures for the three and twelve months ended December 31, 2014 are as previously reported and have not been adjusted for Properties Sold.|
|(4) Operating netback equals petroleum and natural gas sales including realized hedging gains and losses on commodity contracts less royalties, operating costs and transportation costs calculated on a boe basis. Operating netback and funds from operations netback do not have a standardized measure prescribed by International Financial Reporting Standards and therefore may not be comparable with the calculations of similar measures for other companies.|
Throughout 2015, Crew continued to execute on our focused business model of profitably developing and advancing our significant Montney resource base. As a result of numerous strategic decisions made through 2015, the Company is well positioned from an operational and financial standpoint despite a very difficult commodity price environment. We met our targeted exit production volume of over 26,000 boe per day in early December as a result of our successful drilling program leading to increased throughput at our West Septimus facility. Crew's fourth quarter production averaged 20,706 boe per day while full year production averaged 18,542 boe per day reflecting the Company's prudent decision to shut-in volumes during the second half of the year due to extremely weak natural gas prices in NE BC and the impact of a third party pipeline issue which curtailed production in the third quarter. Beginning December 1, 2015, Crew's firm service arrangement with Alliance came into effect providing secure egress for our increased production and exposure to multiple markets and improved pricing.
During 2015, we invested $246.4 million into exploration and development expenditures, or $209.5 million net of the sale of a portion of our West Septimus facility to our infrastructure partner, further offset by proceeds of $50.1 million from our heavy oil disposition. Activities during 2015 were focused on the advancement of our Montney assets including completion of the West Septimus facility, drilling 27 gross (25.3 net) wells in NE BC and completing and tying-in 25 wells, which included both 2015 and 2014 drills. The Company also exited the year with an inventory of 15 wells in NE BC that were drilled but uncompleted that will provide support for first half 2016 production. During the second half of 2015, the Company also commenced construction on the installation of a pipeline beneath the Pine River (the "Pine River Pipeline") which will connect the West Septimus and Septimus plants, reduce condensate transportation costs, facilitate future expansion of the West Septimus facility, enhance longer term market access and position Crew as the only operator with pipeline connections that span the Pine River.
Two strategic transactions completed in 2015 further supported our Montney focus. In July 2015, Crew closed an innovative petroleum and natural gas rights exchange with the Province of British Columbia, adding 53 net sections of land featuring prospective Upper and Lower Montney zones that are contiguous to our Groundbirch property. Crew received this acreage in exchange for surrendering 66 net sections of undeveloped land that had been subject to restricted development since 2004. In September, Crew closed a $50.1 million cash disposition of a minor portion of producing Lloydminster heavy oil assets. This disposition further strengthened the balance sheet by reducing debt outstanding on the credit facility.
Evidence of the high quality of Crew's asset base and our operational efficiencies is clearly demonstrated by our strong 2015 reserves growth, coupled with the lowest finding and development ("F&D") and finding, development and acquisition ("FD&A") costs in the Company's history. These low costs across all reserves categories contributed to strong recycle ratios, even in the context of a very weak commodity price environment. Crew increased 2P reserves to 260.6 million boe with a replacement ratio of 694%, and achieved all-in 2P FD&A costs of $3.86 per boe, with a recycle ratio of 4.3 times.
Crew has been actively working to further reduce costs in all areas of the organization, and has benefitted from a combination of capital cost reductions across the broader industry as well as internal efficiency improvements. The implementation of pad drilling across our core areas has helped to reduce costs and enhance operational efficiencies. Well costs have declined from over $5.0 million in 2014 with recent pad drills averaging $4.0 million per well while also generating improved results. With the increase in throughput at our West Septimus facility in December and our ongoing cost reduction initiatives, Crew's operating costs in the fourth quarter were 19% lower than in the previous quarter, and are forecast to be reduced by 24% or approximately $2.00 per boe in 2016 compared to 2015.
The quality, prospectivity and future potential of the Montney resource continues to improve with time and technology. Crew's achievements through 2015 are evidence of our success in building a strong and growing Company that reflects the Montney: it just keeps getting better.
Crew's strong financial position and ongoing strategy to preserve our balance sheet strength have afforded the Company flexibility to make decisions that are in the long-term interests of the Company and our shareholders. In March 2015, we closed a $100 million equity financing which strengthened the balance sheet and provided Crew with the ability to invest in high return projects despite persistent volatility in commodity prices. The Company exited 2015 with $238.4 million of total debt, including working capital deficiency and the Company's $150 million ($146.7 million net of deferred financing costs) senior unsecured notes that are not due for repayment until the last quarter of 2020. At year-end, Crew had drawn approximately $81.0 million or 32% of our $250 million bank facility. With no near-term maturities, an increasing reserve base and substantial liquidity, Crew is strongly positioned to manage through this ongoing commodity weakness. Our priority continues to be on preserving balance sheet strength while meeting transportation arrangements.
Weak commodity prices prevailed through the fourth quarter of 2015 as the price of oil continued to be impacted by OPEC's persistent resolve to regain global market share. by eliminating quotas which had previously operated to support a higher price. We also endured a weakening natural gas market as North America remained abundantly supplied by constantly improving drilling efficiencies, while demand was impacted by extremely moderate early winter weather patterns. More specifically, Crew's natural gas sales were impacted by ongoing regional price discounts through October and November due to pipeline constraints in northwest Alberta and NE BC. Despite these challenges, Crew was able to increase fourth quarter funds from operations to $19.6 million, a 24% improvement over the third quarter due to a 23% increase in production and a significant drop in our overall cost structure. Fourth quarter cash costs per boe were reduced by 22% compared to the third quarter 2015, highlighted by a 47% reduction in royalty charges, a 19% drop in operating costs, and a 31% decline in G&A costs.
Net capital expenditures during the fourth quarter totaled $5.4 million which included exploration and development expenditures of $42.1 million, offset by the recovery of $36.8 million from our facility partner for their share of the cost to build the West Septimus gas processing facility. Exploration and development expenditures during the quarter included the drilling of six gross (6.0 net) wells and the completion of seven (6.0 net) wells in West Septimus and Septimus. Expenditures include an incremental $9 million of capital that was added to our fourth quarter 2015 budget as we took advantage of the exceptional fall weather and the efficiencies and cost savings offered by maintaining one rig drilling through to the middle of December. The Company continued operations to install the Pine River Pipeline during the quarter. The majority of the cost of the Pine River Pipeline project was incurred as planned in 2015, against which an $11 million Government of British Columbia infrastructure credit is expected to be earned upon project completion. This credit was originally forecast to be recognized in the fourth quarter but has been deferred along with the expected completion of the project into the first quarter of 2016.
TRANSPORTATION AND MARKETING
Crew's firm transportation arrangement on Alliance took effect on December 1, 2015 securing takeaway capacity to various markets, enabling Crew to capture more favorable pricing. Concurrent with the start of the Company's firm Alliance transportation service, Crew also entered into several marketing arrangements diversifying the Company's market exposure for natural gas. Starting December 1, 2015 approximately 40% of our natural gas is sold at Chicago City-gate pricing, while 50% is priced at an AECO equivalent. Currently 10% of Crew's volumes are exposed to the Spectra Energy ("Spectra") system. Longer term, Crew has committed to expansions of takeaway capacity on both the Spectra and TransCanada Pipeline systems, positioning the Company for future growth and provides the ability to continue to actively manage our market and operational diversification. In addition, Crew has secured firm service arrangements on the Pembina Pipeline system to transport produced liquids from the greater Septimus area through our 100% owned LACT (Lease Automatic Custody Transfer) unit.
Crew's risk management strategy is designed to partially protect cash flows against significant declines in commodity prices, while partially safeguarding a funding source for our capital program. In 2015 the Company realized a $40.9 million, or $6.05 per boe, hedging gain. In 2016, the Company has protected a portion of our funds from operations and helped to support ongoing financial stability with approximately 44% of our estimated 2016 natural gas volumes currently hedged with a floor price of approximately $2.73 per gj or approximately $2.88 per mcf. For 2017, the Company has 7% of our estimated 2017 natural gas volumes hedged at a price of $2.90 per gj or approximately $3.06 per mcf.
The significant growth potential and prospectivity of Crew's Montney asset base was clearly reflected in our 2015 operational performance and year end reserves report. We continued to generate positive drilling results providing over 40 mmcf per day of productive capacity in the first phase of our West Septimus growth plan. Construction of the 60 mmcf per day West Septimus facility was completed in early August and brought on-stream at approximately half capacity as budgeted, with increased throughput taking effect December 1, 2015 concurrent with the commencement of our firm transportation arrangements. A combination of our well performance and the ramp-up of the facility contributed to reaching our 2015 exit production rate of over 26,000 boe per day in December.
Crew's capital efficiencies improved markedly in 2015 as demonstrated by our top quartile F&D and FD&A costs and recycle ratios. A portion of these record low costs stem from Crew's strategic decision to maintain an established inventory of drilled wellbores which allowed the Company to complete and tie-in volumes in an efficient and timely manner to meet transportation arrangements and grow production. This strategy continues into 2016 as Crew had a total of 15 (14.3 net) wells drilled in inventory at the end of 2015. Our Montney well costs have declined substantially since 2014 with recent 2016 per well costs totaling approximately $4.0 million to drill, complete and tie-in with further improvements in cost structure anticipated. This achievement is meaningfully lower than the $4.3 million Septimus / West Septimus undeveloped well cost included in our 2015 year end reserve report.
The operational success realized at West Septimus in 2015 confirmed the substantial opportunity for further drilling and area expansion. At West Septimus, 2P reserve bookings increased 110%, achieving significantly higher gas rates as well as liquids reserves that were 300% higher than 2014. Crew drilled six (6.0 net) wells in the fourth quarter, accelerating the drilling of the first four of an eight well pad at West Septimus originally planned for the first quarter of 2016 to capitalize on efficiencies and favorable weather. This operational momentum has continued into the first quarter, as Crew completed and tested two wells at West Septimus. The first of these wells achieved a production test rate of 12 mmcf per day after a nine day clean-up period with 56 bbls per mmcf of wellhead condensate at a flowing casing pressure of 1,335 psi. The second well achieved a production test rate of 10 mmcf per day after a six day clean-up period with wellhead condensate of 42 bbls per mmcf at a flowing casing pressure of 1,340 psi.
At Septimus, Crew increased throughput volumes at our Septimus facility concurrent with our Alliance transportation arrangement on December 1, 2015 and the plant achieved a new record throughput in excess of 11,600 boe per day (65.6 mmcf/day inlet volumes) during December 2015. In addition, the Company realized positive results from our first Lower Montney well at Septimus which averaged 4.4 mmcf per day over the first 60 days of production with 34 bbls per mmcf of field condensate. At Septimus, our first Lower Montney reserves were assigned covering approximately three (2.0 net) sections. Inclusive of the one existing net section that had previously been assigned Lower Montney reserves at Attachie, Crew's total Lower Montney reserves represent only 0.6% of our overall Montney land base, confirming that the Lower Montney represents an additional substantial opportunity for expanded future drilling.
Activity at Crew's other key Montney areas at Attachie / Groundbirch and Tower were limited during the latter half of 2015 as the Company elected to focus on areas offering more attractive economics in the current commodity price environment. Crew drilled a vertical stratigraphic test well at Tower in Q4 2015 for the purpose of gathering specific reservoir information that will be used in the design and optimization of future completions within the Montney oil window, which represents approximately 33% of Crew's overall land base. These areas offer significant oil and liquids growth potential, which the Company plans on developing with improved commodity prices.
At our Lloydminster heavy oil property, the Company successfully divested of a non-core heavy oil asset package for $50.1 million, which bolstered the balance sheet. Crew continued to employ a conservative approach at Lloydminster through 2015, including electing not to restart wells that did not meet stringent economic criteria contributing to a 13% reduction in area operating costs which averaged $16.74 per boe. Current area production is approximately 2,800 boe per day with approximately 600 boe per day of production offline awaiting more favorable pricing.
RESERVES VALUE PER DILUTED SHARE
Following is a calculation of Crew's estimated reserves value per diluted share less debt at December 31, 2015. This value is based on the net present value ("NPV") of estimated future net revenues attributed to Crew's 2P reserves before income tax and discounted at 10% as reflected in the independent corporate reserves evaluation prepared by Sproule Associates Ltd. ("Sproule") with an effective date of December 31, 2015.
|$000s||$ per share(4)|
|Estimated net debt(3)||(238,396)|
|Reserves value less debt (diluted)||1,418,401||$9.87|
|(1) Evaluated by Sproule as at December 31, 2015. NPV of future net revenue does not represent fair market value of the reserves.|
|(2) NPV before taxes based on Sproule's forecast prices and costs as of December 31, 2015 are stated prior to provision for interest, debt service charges or general administrative expenses and after deduction of royalties, operating costs, estimated well abandonment and reclamation costs and estimated future capital expenditures.|
|(3) Net debt as at December 31, 2015, including working capital deficit.|
|(4) Per share figures based on 143.7 million diluted shares including "in the money" stock options and incentive awards outstanding as at December 31, 2015.|
In 2016, Crew will prioritize the preservation of our balance sheet strength while managing production volumes to optimize netbacks. We have reduced our previously released 2016 capital budget by $4 million to $70 million to reflect expenditures incurred in 2015 that were originally planned for 2016 and confirm Crew's previous 2016 average production guidance of 23,000 to 25,000 boe per day. As the year progresses, we will continue to monitor the impact of changing commodity prices and plan to adjust capital spending to approximate estimated funds from operations. Our 2016 program anticipates growth in annual average production of over 25% year-over-year, a result of the additional production capacity in our new West Septimus gas plant and a very active and highly successful 2015 drilling program. Crew's sustainability has continued to improve, with over 100 Montney wells on production that support a PDP decline rate of 28%, which is a seven percent reduction from the 30% decline rate the previous year. Maintaining operational flexibility is critical in this environment and our readiness will enable efficient increases in activity and investment when commodity prices improve. Crew's 2016 drilling and development capital will continue to be allocated to our high return areas at West Septimus and Septimus where we continue to drive costs down. We remain committed to our Montney development and in 2016 plan to complete and bring on-stream the inventory of 15 wells that were drilled in 2015, as well as drill, complete and tie-in seven gross (6.0 net) additional wells.
Despite very challenging market conditions through 2015 and into 2016, Crew has continued to stick to our plan to cut costs and efficiently grow our production. Full cycle capital efficiencies are expected to improve in 2016 as Crew invested $113.8 million in infrastructure during 2015 and does not plan material expenditures on infrastructure in 2016. In an environment of low prices and severely constrained funds from operations, we have successfully:
We will continue to pursue the optimization of well designs and focus on the development of our Montney assets, while seeking to provide long-term profitable growth for our shareholders. With further advances in technology and the ongoing development of our Montney resource, Crew's position as a growing Montney producer continues to improve year after year.
We would like to thank all of Crew's employees, management, consultants and our Board of Directors for their hard work and unwavering dedication, and we sincerely thank our shareholders for your continued support of Crew's Montney focused strategy.
Forward-Looking Information and Statements
This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "plans", "intends" "forecast" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the volume and product mix of Crew's oil and gas production; production estimates including 2016 forecast average production; future decline rates; future oil and natural gas prices and Crew's commodity risk management programs; future liquidity and financial capacity; future results from operations and operating metrics; potential for further reductions in operating costs and potential to improve ultimate recoveries and initial production rates; future costs, expenses and royalty rates; future interest costs; the exchange rate between the $US and $Cdn; future development, exploration, acquisition, development and infrastructure activities and related capital expenditures and the timing thereof; the number of wells to be drilled, completed and tied-in and the timing thereof; the amount and timing of capital projects including anticipated timing of completion of the Pine River Pipeline and expected recovery of the majority of this expenditure through the BC infrastructure credit; the total future capital associated with development of reserves and resources; and methods of funding our capital, including possible non-core asset divestitures and asset swaps.
Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Crew which have been used to develop such statements and information but which may prove to be incorrect. Although Crew believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because Crew can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Crew operates; the timely receipt of any required regulatory approvals; the ability of Crew to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Crew has an interest in to operate the field in a safe, efficient and effective manner; the ability of Crew to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Crew to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Crew operates; the ability of Crew to successfully market its oil and natural gas products. There are a number of assumptions associated with the potential of reserve and resource volumes assigned to the evaluated areas including the quality of the Montney reservoir, future drilling programs and the funding thereof, continued performance from existing wells and performance of new wells, the growth of infrastructure, well density per section, and recovery factors and discovery and development necessarily involves known and unknown risks and uncertainties, including those identified in this press release.
The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward-looking information or statements including, without limitation: changes in commodity prices; the potential for variation in the quality of the Montney formation; changes in the demand for or supply of Crew's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Crew or by third party operators of Crew's properties, increased debt levels or debt service requirements; inaccurate estimation of Crew's oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Crew's public disclosure documents (including, without limitation, those risks identified in this news release and Crew's Annual Information Form).
The forward-looking information and statements contained in this news release speak only as of the date of this news release, and Crew does not assume any obligation to publicly update or revise any of the included forward-looking statements or information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Information Regarding Disclosure on Oil and Gas Reserves and Operational Information
Information presented herein in respect of reserves and related information is based on our independent reserves evaluation for the year ended December 31, 2015 prepared by Sproule Associates Limited, details of which were provided in our press release issued on February 17, 2016. Our oil and gas reserves statement for the year ended December 31, 2015, which will include complete disclosure of our oil and gas reserves and other oil and gas information in accordance with NI 51-101, will be contained within our Annual Information Form which will be available on our SEDAR profile at www.sedar.com. The recovery and reserve estimates contained herein are estimates only and there is no guarantee that the estimated reserves will be recovered. In relation to the disclosure of estimates for individual properties, such estimates may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to the effects of aggregation. The Company's belief that it will establish additional reserves over time with conversion of probable undeveloped reserves into proved reserves is a forward-looking statement and is based on certain assumptions and is subject to certain risks, as discussed above under the heading "Forward-Looking Information and Statements".
This press release contains metrics commonly used in the oil and natural gas industry, such as "recycle ratio", "finding and development costs", "recycle ratio", "finding, development and acquisition costs", "operating netbacks", "reserves replacement", and "reserve life index". Reference is made to Crew's press release dated February 17, 2016 for definitions and details of the calculation of such metrics used herein. These terms do not have standardized meanings or standardized methods of calculation and therefore may not be comparable to similar measures presented by other companies, and therefore should not be used to make such comparisons. Such metrics have been included herein to provide readers with additional information to evaluate the Company's performance, however such metrics should not be unduly relied upon.
Both F&D and FD&A costs take into account reserves revisions during the year on a per boe basis. The aggregate of the costs incurred in the financial year and changes during that year in estimated FDC may not reflect total F&D costs related to reserves additions for that year. Finding and development costs both including and excluding acquisitions and dispositions have been presented in this press release because acquisitions and dispositions can have a significant impact on our ongoing reserves replacement costs and excluding these amounts could result in an inaccurate portrayal of our cost structure. Management uses oil and gas metrics for its own performance measurements and to provide shareholders with measures to compare Crew's operations over time. Readers are cautioned that the information provided by these metrics, or that can be derived from the metrics presented in this press release, should not be relied upon for investment or other purposes.
Barrel of oil equivalents or BOEs 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 than the energy equivalency of 6:1, utilizing a 6:1 conversion basis may be misleading as an indication of value.
Test Results and Initial Production Rates
A pressure transient analysis or well-test interpretation has not been carried out and thus certain of the test results provided herein should be considered to be preliminary until such analysis or interpretation has been completed. Test results and initial production rates disclosed herein may not necessarily be indicative of long term performance or of ultimate recovery.
Our full audited consolidated Financial Statements and Notes, as well as Management's Discussion and Analysis ("MD&A") for the year ended December 31, 2015 are available on Crew's website and will be filed on SEDAR.
Crew Energy Inc. is a dynamic, growth-oriented exploration and production company, focused on increasing long-term production, reserves and cash flow per share through the development of our world-class Montney resource. Crew is based in Calgary, Alberta and our shares are traded on The Toronto Stock Exchange under the trading symbol "CR".