|By Marketwired .||
|March 18, 2014 08:45 PM EDT||
CALGARY, ALBERTA -- (Marketwired) -- 03/18/14 -- Painted Pony Petroleum Ltd. ("Painted Pony" or the "Company") (TSX: PPY) is pleased to announce its 2013 financial and operating results and provide an operations update. Highlights include:
-- increased average production in 2013 to 8,693 barrels of oil equivalent per day ("boe/d"), weighted 82% towards natural gas, representing a 32% increase over 2012 average production. Natural gas production increased by 42% to average 42.9 million cubic feet per day ("MMcf/d"), and natural gas liquids ("NGL") production increased by 118% to average 449 barrels per day ("bbls/d"); -- increased fourth quarter 2013 production by 28% over fourth quarter 2012 production to average 9,312 boe/d, weighted 84% towards natural gas; -- generated record funds flow from operations of $51.2 million in 2013, representing a 30% increase over 2012; -- recorded a Company field operating netback ("netback") of $18.88/boe; -- achieved a recycle ratio of 2.0 times for proved plus probable ("P+P") reserves, based on a netback of $18.88/boe and finding, development and acquisition costs of $9.55/boe; -- initiated a risk management program whereby the Company has hedged up to 19.0 MMcf/d of natural gas production through the first quarter of 2015 at average quarterly fixed AECO prices ranging from $3.99 per thousand cubic feet ("Mcf") of natural gas to $4.18/Mcf; and -- completed construction of the 25 MMcf/d Townsend facility, which is currently undergoing commissioning operations.
2013 FINANCIAL AND OPERATING RESULTS
Annual average production in 2013 increased by 32% from 2012 to 8,693 boe/d (82% natural gas), while annual production per share increased by 6%. Included in the production increases in 2013, were natural gas production increases of 42% to 42.9 MMcf/d and natural gas liquids production increases of 118% to 449 bbls/d. Fourth quarter 2013 production averaged 9,312 boe/d (84% natural gas), representing an increase of 28% over fourth quarter 2012 production. Also, on a quarter over quarter basis, natural gas production increased by 40% to average 46.8 MMcf/d and NGL production increased by 120% to average 537 bbls/d. Field estimated production for January and February of 2014 was approximately 9,800 boe/d, weighted 84% towards natural gas.
Funds flow from operations in 2013 increased by 30% to $51.2 million over 2012 funds flow from operations of $39.3 million, due to production increases and the rebound in natural gas prices in 2013. Throughout 2013, Painted Pony realized an average natural gas price of $3.45/Mcf, representing a premium of 8% over the average AECO spot price of $3.18/Mcf, which had rebounded by 33% over the 2012 average of $2.39/Mcf.
With increased production and higher realized prices, Painted Pony achieved a 2013 corporate netback of $18.88/boe, approximately 3% higher than netbacks in 2012. Additionally, Painted Pony increased its proved plus probable reserves by 52% to 290.3 million barrels of oil equivalent ("MMboe"), representing a 51% increase in reserves per share. As previously announced on March 4, 2014, on a P+P basis, the Company achieved a recycle ratio of 2.0 times, with an associated finding, development and acquisition cost of $9.55/boe (see Company press release dated March 4, 2014 for further disclosures).
Capital expenditures in 2013 totaled $146.6 million and included expenditures for drilling and completions of $90.7 million, facilities and equipment of $28.3 million, and Crown land acquisitions of $13.8 million. Painted Pony drilled a total of 18 (13.0 net) wells, including 13 (9.6 net) wells targeting natural gas in the Montney formation in British Columbia. In 2013, Painted Pony increased its $100 million demand credit facility to syndicated credit facilities of $125 million, backed by three Canadian chartered banks and exited 2013 with bank debt of $28.6 million. Additionally, Painted Pony initiated its risk management program by hedging up to 19.0 MMcf/d of natural gas production through the first quarter of 2015 with quarterly average fixed AECO prices ranging from $3.99/Mcf to $4.18/Mcf, all of which are above the Company's budgeted price of $3.71/Mcf.
MONTNEY NATURAL GAS OPERATIONS
Construction of the Townsend 25 MMcf/d gas processing and condensate stabilization facility has been completed and the facility is currently undergoing commissioning operations. Once the facility has been fully commissioned, 3 (3.0 net) wells at the 56-H pad, and 2 (2.0 net) wells at the 11-J pad, including the previously shut in a-B11-J well, will begin flowing to the facility. Following operations start-up, Painted Pony anticipates Company production volumes to exceed 11,500 boe/d including increased liquids realization. In addition to the construction of the facility, Painted Pony continues to evaluate the engineering requirements for a proposed 190 MMcf/d, shallow-cut, gas refrigeration and processing plant at Townsend, which is currently planned for 2015.
To date in 2014, Painted Pony has completed 2 (2.0 net) Montney wells located on the Townsend 56-H pad, while 2 (2.0 net) wells on the Blair 41-F pad are currently undergoing frac operations, all using open hole ball-drop technology. Both wells at the 56-H pad have been shut-in, and are awaiting full commissioning of the Townsend facility for clean-up and testing operations. Painted Pony remains encouraged by the results of open hole ball-drop technology and will continue to utilize it to complete all of its wells in 2014, as cost savings remain in excess of $0.7 million per well relative to the previously deployed perf-and-plug system.
Currently, at the Company's Blair property, Painted Pony is drilling a second 100% working interest Montney well on the 11-F pad and the first of 2 (2.0 net) wells on the 91-F pad. Upon drilling the Upper and Lower Montney wells on the 91-F pad, the Company anticipates drilling a second 100% working interest delineation well at the West Blair property on the 26-L pad. Further to continued delineation at West Blair, Painted Pony has commenced an engineering study for a proposed 25 MMcf/d lean-gas processing facility to tie-in additional volumes from the area.
SOUTHEAST SASKATCHEWAN OPERATIONS
Painted Pony continues to identify light oil opportunities on its southeast Saskatchewan properties. Prior to the end of the second quarter of 2014, the Company will drill the first of 2 (2.0 net) appraisal wells in the Ralph area to further delineate a new light oil discovery pool. Additionally, and on trend with a recent surge in drilling activity, Painted Pony intends to drill its first 30% working interest Torquay exploration well on the Company's Flat Lake property, where the Company has over 11,300 net acres (17 net sections) of rights.
Painted Pony is a Canadian oil and gas exploration company that trades on the Toronto Stock Exchange under the symbol "PPY".
For more information please visit www.paintedpony.ca.
Financial and Operating Highlights
--------------------------------------------------------------------------- 3 months ended Year ended Dec. Dec. 31, 31, --------------------------------------------------------------------------- 2013 2012 2013 2012 --------------------------------------------------------------------------- Financial ($ millions, except per share and shares outstanding) Petroleum and natural gas revenue(1) 27.5 22.9 103.1 74.8 Funds flow from operations(2) 12.3 12.4 51.2 39.3 Per share - basic(3) 0.14 0.17 0.58 0.56 Per share - diluted(4) 0.14 0.17 0.58 0.55 Net comprehensive loss (4.4) (40.7) (5.7) (48.1) Per share - basic(3) and diluted(4) (0.05) (0.56) (0.06) (0.68) Capital expenditures(5) 39.7 156.8 146.6 241.3 Working capital (deficiency)(6) (16.3) 45.2 (16.3) 45.2 Bank Debt 28.6 - 28.6 - Total assets 635.1 612.2 635.1 612.2 Shares outstanding (000s) 88,457 88,052 88,457 88,052 Basic weighted-average shares (000s) 88,457 73,041 88,420 70,825 Fully diluted weighted-average shares (000s) 88,457 73,586 88,488 70,995 Operational Daily production volumes Natural gas (Mcf per day) 46,841 33,430 42,853 30,248 Crude oil and natural gas liquids (bbls per day) 1,505 1,717 1,551 1,548 Total (boe per day) 9,312 7,289 8,693 6,589 Realized prices Natural gas ($ per Mcf) 3.76 3.31 3.45 2.54 Crude oil ($ per bbl) 86.88 83.49 93.02 85.67 Natural gas liquids ($ per bbl) 63.47 56.02 62.54 54.75 Field operating netbacks(7)($ per boe) British Columbia 15.22 13.46 13.96 9.21 Saskatchewan 41.66 46.82 48.72 48.00 Company combined 18.28 21.14 18.88 18.40 --------------------------------------------------------------------------- 1. Before royalties 2. This table contains the term "funds flow from operations", which should not be considered an alternative to, or more meaningful than "cash flows from operating activities" as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from operations and funds flow from operations per share (basic and diluted) does not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from operations to analyze operating performance and leverage and considers funds flow from operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from operations and cash flows from operating activities can be found in "Management's Discussion and Analysis". Funds flow from operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings per share. 3. Basic per share information is calculated on the basis of the weighted average number of shares outstanding in the period. 4. Diluted per share information reflects the potential dilutive effect of options. 5. Including acquisitions, decommissioning obligations, and capitalized share-based payments. 6. This table contains the term "working capital (deficiency)". Working capital (deficiency) does not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management calculates working capital (deficiency) as current assets less current liabilities and uses this ratio to analyze operating performance and leverage. 7. This table contains the term "field operating netbacks". Field operating netback does not have any standardized meaning prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management calculates field operating netback on a per unit basis as crude oil, natural gas, natural gas liquids revenues and other income less royalties, operating and transportation costs.
Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this news release.
Special Note Regarding Forward-Looking Information
This news release contains certain forward-looking statements, which are based on numerous assumptions including but not limited to (i) drilling success; (ii) production; (iii) future capital expenditures;(iv)accuracy of FD&A and FDC estimates; (v) accuracy of reserves and resources estimates; and (vi) cash flows from operating activities. In addition, and without limiting the generality of the foregoing, the key assumptions underlying the forward-looking statements contained herein include the following: (i) commodity prices will be volatile, and natural gas prices will remain low, throughout 2014; (ii) capital, undeveloped lands and skilled personnel will continue to be available at the level Painted Pony has enjoyed to date; (iii) the effect of hedges on risk management programs; (iv) Painted Pony will be able to obtain equipment in a timely manner to carry out exploration, development and exploitation activities; (v) production rates in 2014 are expected to show growth from the fourth quarter of 2013; (vi) Painted Pony will have sufficient financial resources with which to conduct the capital program; and (vii) the current tax and regulatory regime will remain substantially unchanged The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect.
This news release contains information, including in respect of Painted Pony's capital program, which may constitute future oriented financial information or a financial outlook. Such information was approved by management of Painted Pony on March 4, 2014, and such information is included herein to provide readers with an understanding of the Company's anticipated capital expenditures. Readers are cautioned that the information may not be appropriate for other purposes.
Certain information regarding Painted Pony set forth in this document, including estimates of the Company's reserves and resources, estimates of future net revenue from the Company's reserves and resources, pricing, inflation and exchange rates, FD&A and FDC and future development costs may constitute forward-looking statements under applicable securities laws and necessarily involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Painted Pony's control, including without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, environmental risks, inability to obtain drilling rigs or other services, capital expenditure costs, including drilling, completion and facility costs, unexpected decline rates in wells, wells not performing as expected, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, and stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof. Readers are cautioned that the foregoing list of factors is not exhaustive. Painted Pony's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance 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, including the amount of proceeds, that the Company will derive therefrom. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements.
This news release contains other industry benchmarks and terms, such as field operating netbacks (calculated on a per unit basis as oil, gas and natural gas liquids revenues less royalties and transportation and operating costs) and finding, development and acquisition costs (calculated by dividing the capital costs for the period, including the change in undiscounted future development capital, by the change in the reserves, incorporating revisions and production, for the same period), which are not recognized measures under International Financial Reporting Standards. These measures are commonly utilized in the oil and gas industry and are considered informative for management and stakeholders. Painted Pony's method of calculating field operating netbacks and FD&A costs may not be comparable to that used by other companies. Field operating netbacks should not be viewed as an alternative to cash flow from operations or other measures of financial performance calculated in accordance with IFRS. Per unit field operating netbacks reflect revenues less royalties, transportation and operating costs divided by production for the period. Painted Pony's method of calculating field operating netbacks may not be comparable to the method used by other companies.
Additional information on these and other factors that could affect Painted Pony's operations and financial results are included in the Company's Management's Discussion and Analysis for the year ended December 31, 2013, and the Company's Annual Information Form for the year ended December 31, 2013 and in reports which are on file with the Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) or Painted Pony's website (www.paintedpony.ca).
The forward-looking statements contained in this document are made as at the date of this news release and Painted Pony does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Special Note Regarding Disclosure of Finding and Development Costs
The aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserves additions for that year.
The FD&A costs presented in this news release are used as a measure of capital efficiency and are calculated by dividing the capital costs for the period, including the change in undiscounted future development capital, by the change in the reserves, incorporating revisions and production, for the same period (eg. Total P+P (143+835)/102.4).
In calculating the amounts of finding and development and/or acquisition costs for a year, the changes during the year in estimated FDC and in estimated reserves and resources are based upon the evaluations of Painted Pony's reserves and resources prepared by GLJ and Sproule effective December 31 of such year. The aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated FDC generally will not reflect total FD&A related to reserve and resource additions for that year.
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 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 Mcf: 1 bbl, utilizing a conversion ratio at 6 Mcf: 1 bbl may be misleading as an indication of value.
Estimates of reserves for individual properties may not reflect the same confidence level as estimates of reserves for all properties due to the effects of aggregation.
Painted Pony Petroleum Ltd.
Patrick R. Ward
President & CEO
(403) 238-1487 (FAX)
Painted Pony Petroleum Ltd.
John H. Van de Pol
Vice President, Finance & CFO
(403) 238-1487 (FAX)
As machines are increasingly connected to the internet, it’s becoming easier to discover the numerous ways Industrial IoT (IIoT) is helping to shape the business world. This is exactly why we have decided to take a closer look at this pervasive movement and to examine the desire to connect more things! Now if you need a refresher on IIoT and how it is changing the world, take a moment and listen to Greg Gorbach with ARC Advisory Group. Gorbach believes, "IIoT will significantly change the worl...
May. 24, 2016 09:00 PM EDT Reads: 1,776
Enterprise networks are complex. Moreover, they were designed and deployed to meet a specific set of business requirements at a specific point in time. But, the adoption of cloud services, new business applications and intensifying security policies, among other factors, require IT organizations to continuously deploy configuration changes. Therefore, enterprises are looking for better ways to automate the management of their networks while still leveraging existing capabilities, optimizing perf...
May. 24, 2016 08:45 PM EDT Reads: 911
Designing IoT applications is complex, but deploying them in a scalable fashion is even more complex. A scalable, API first IaaS cloud is a good start, but in order to understand the various components specific to deploying IoT applications, one needs to understand the architecture of these applications and figure out how to scale these components independently. In his session at @ThingsExpo, Nara Rajagopalan is CEO of Accelerite, will discuss the fundamental architecture of IoT applications, ...
May. 24, 2016 08:45 PM EDT Reads: 659
As cloud and storage projections continue to rise, the number of organizations moving to the cloud is escalating and it is clear cloud storage is here to stay. However, is it secure? Data is the lifeblood for government entities, countries, cloud service providers and enterprises alike and losing or exposing that data can have disastrous results. There are new concepts for data storage on the horizon that will deliver secure solutions for storing and moving sensitive data around the world. ...
May. 24, 2016 08:30 PM EDT Reads: 932
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
May. 24, 2016 08:15 PM EDT Reads: 1,023
Many banks and financial institutions are experimenting with containers in development environments, but when will they move into production? Containers are seen as the key to achieving the ultimate in information technology flexibility and agility. Containers work on both public and private clouds, and make it easy to build and deploy applications. The challenge for regulated industries is the cost and complexity of container security compliance. VM security compliance is already challenging, ...
May. 24, 2016 07:45 PM EDT Reads: 886
The essence of data analysis involves setting up data pipelines that consist of several operations that are chained together – starting from data collection, data quality checks, data integration, data analysis and data visualization (including the setting up of interaction paths in that visualization). In our opinion, the challenges stem from the technology diversity at each stage of the data pipeline as well as the lack of process around the analysis.
May. 24, 2016 07:15 PM EDT Reads: 963
What a difference a year makes. Organizations aren’t just talking about IoT possibilities, it is now baked into their core business strategy. With IoT, billions of devices generating data from different companies on different networks around the globe need to interact. From efficiency to better customer insights to completely new business models, IoT will turn traditional business models upside down. In the new customer-centric age, the key to success is delivering critical services and apps wit...
May. 24, 2016 06:30 PM EDT Reads: 725
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York and Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty ...
May. 24, 2016 06:00 PM EDT Reads: 4,639
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit y...
May. 24, 2016 05:00 PM EDT Reads: 1,837
Cloud computing changed data analytics for good. It enabled companies to drastically decrease resources and architecture previously assigned with business intelligence departments. It also enabled laymen to run advanced business analytics. Cloud was also the architecture of choice for storing and processing big data. Data piling is a continuous process, which is going to explode with emerging Internet of Things concept. Answer to this issue developers found in new concept called fog computing. ...
May. 24, 2016 04:15 PM EDT Reads: 1,817
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo New York Call for Papers is now open.
May. 24, 2016 04:00 PM EDT Reads: 1,678
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will discuss the vast to...
May. 24, 2016 04:00 PM EDT Reads: 2,349
SYS-CON Events announced today that Enzu, a leading provider of cloud hosting solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to foc...
May. 24, 2016 02:15 PM EDT Reads: 2,072
SYS-CON Events announced today the How to Create Angular 2 Clients for the Cloud Workshop, being held June 7, 2016, in conjunction with 18th Cloud Expo | @ThingsExpo, at the Javits Center in New York, NY. Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified. Now it’s a component-based well-performing framework. The immersive one-day workshop led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and...
May. 24, 2016 02:00 PM EDT Reads: 3,839