Welcome!

News Feed Item

PetroShale Announces First Quarter 2014 Results

CALGARY, ALBERTA -- (Marketwired) -- 05/30/14 -- PetroShale Inc. ("PetroShale" or the "Company") (TSX VENTURE:PSH)(OTCQX:PSHIF) is pleased to announce its financial and operating results for the quarter ended March 31, 2014. The Company's unaudited consolidated financial statements and corresponding Management's Discussion and Analysis (MD&A) for the three month period ended March 31, 2014, will be available on SEDAR at www.sedar.com, on the OTCQX website at www.otcqx.com, and on PetroShale's website at www.petroshaleinc.com. Copies of the materials can also be obtained upon request without charge by contacting the Company directly.

Operating Highlights:


--  Reported production for the quarter of 166 boe/d (Company interest,
    gross of royalty - 127 boe/d net of royalty interest), weighted 95% to
    light crude oil and liquids, a 34% increase over the same period in
    2013.  
    
    
--  Including incremental production volumes from four (gross) new wells
    that came on-stream in February 2014 in the Company's Stockyard Creek
    asset, confirmed run-rate production through early May of approximately
    300 boe/d (gross of royalty); 
    
    
--  In addition to the four (0.2 net) new wells brought onto production
    during the quarter, the Company drilled and is in various stages of
    completing an additional four (0.4 net) wells subsequent to the end of
    the quarter; 
    
    
--  Realized strong operating netbacks of $54.22 per boe (Company interest,
    gross of royalty, and excluding the impact of hedging - $71.14 per boe
    net of royalty interest and excluding hedging), which reflects the
    Company's high quality production, combined with a strong pricing
    environment and low operating expenses; and 
    
    
--  Continued to successfully execute on its aggressive acquisition strategy
    in North Dakota, closing three separate transactions during the period.
    These include an 18.75% Working Interest ("WI") in a proposed drilling
    unit in McKenzie County, an approximate 19% WI in a drilling unit in
    Williams County, as well as the acquisition of additional undeveloped
    land in Mountrail County through a Federal land sale. Subsequent to the
    end of the quarter, the Company closed on the acquisition of an
    additional 9.5% interest in two of its existing wells in Stockyard
    Creek, and acquired two additional acreage parcels in McKenzie County. 

Financial Highlights:


--  Generated $1.1 million in revenue net of royalties during the period, an
    increase of 47% over the same period in 2013, reflecting the substantial
    growth in the Company's assets; 
--  Enhanced ongoing financial flexibility to fund further acquisitions and
    capital programs by securing a subordinated loan facility provided by
    the Company's two largest shareholders. The facility was recently
    increased from $20 million to $30 million in capacity; and 
--  Subsequent to the end of the period, announced a private placement of up
    to 5 million common voting shares at a price of $1.30 per share, for
    total gross proceeds of up to $6.5 million. Proceeds will be used
    initially to repay outstanding debt. Completion of the private placement
    is subject to the approval of the TSX Venture Exchange. 

Results of Oil and Gas Activities


                                                    March 31,     March 31, 
For the three months ended                               2014          2013 
----------------------------------------------------------------------------
                                                                            
Sales volumes                                                               
  Oil and natural gas liquids (Bbl/d)                     159           117 
  Natural gas (Mcf/d)                                      41            41 
----------------------------------------------------------------------------
Barrel of oil equivalent (Boe/d)                          166           124 
                                                                            
Barrel of oil equivalent, net of royalty (Boe/d)          127            96 
                                                                            
Operating Netbacks ($/Boe)                                                  
  Revenue                                         $     92.57   $     82.38 
  Royalties                                            (22.02)       (18.50)
  Realized hedge loss                                   (0.54)            - 
  Operating costs                                      (10.84)       (18.50)
  Production taxes                                      (5.49)        (2.23)
----------------------------------------------------------------------------
Operating netback                                 $     53.68   $     43.15 
----------------------------------------------------------------------------
Operating netback prior to hedging                $     54.22   $     43.15 
----------------------------------------------------------------------------
Operating netback prior to hedging, on a net of                             
 royalty basis                                    $     71.14   $     55.65 
----------------------------------------------------------------------------

Earnings before interest, taxes, depreciation and amortization (EBITDA) was $204,000 for the three month period ended March 31, 2014 compared to $141,000 for the quarter ended March 31, 2013. For the first quarter ended March 31, 2014 the Company reported a net loss of $554,000 ($0.02 per share), compared to a loss of $17.4 million ($0.60 per share) for the three month period ended March 31, 2013 (primarily due to an impairment charge taken in the prior period).

Letter to shareholders:

The first three months of calendar 2014 coincide with PetroShale's first quarterly reporting period since changing our year end to December 31.

Through the first quarter, we continued to execute on our strategy of acquiring and consolidating working interests ("WI") in the most prolific and proven areas of the Williston Basin. In January 2014, we successfully acquired an 18.75% WI in a proposed drilling unit within the highly productive McKenzie County. This drilling unit has been spaced for 8 wells and will be operated by EOG Resources, Inc., a leading and technically skilled operator in the North Dakota Bakken.

In February 2014, we followed up on that transaction with the purchase of acreage in Williams County, consisting of an approximately 19% WI in a drilling unit. Finally, through our participation in a Federal land sale, we successfully acquired additional prospective but undeveloped land in Mountrail County for US$1.8 million. Subsequent to the end of the quarter, we purchased an additional working interest of approximately 9.5% in two of our existing wells in Stockyard Creek, and also acquired an interest in two additional acreage parcels in McKenzie County.

In May, 2014, we announced a private placement of up to 5 million common voting shares at a price of $1.30 per share, to generate gross proceeds of up to $6.5 million. Upon closing, which is anticipated in early June 2014, net proceeds will be used to repay a portion of outstanding debt. This, along with the extension of our subordinated loan facility, will provide PetroShale with enhanced financial flexibility as we continue to pursue acquisitions that add to our growing asset base in the North Dakota Bakken.

With our financial strength coupled with our business alliance with premier operator, Slawson Exploration Company Inc., we are well positioned to continue seeking strategic asset acquisitions in the Williston Basin that offer us the ability to grow organically through a high quality asset base. As drilling activity continues across our asset base through the balance of 2014, we expect to benefit from resulting increases in production, cash flow and booked reserves.

Thank you again for your interest in PetroShale, and we look forward to keeping our shareholders updated on our ongoing growth and expansion.

M. Bruce Chernoff

Executive Chairman and CEO

About PetroShale

PetroShale is a growing oil company engaged in the acquisition and consolidation of interests in the most prolific and proven areas of the Williston Basin in North Dakota and Montana.

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 release.

Note Regarding Forward-Looking Statements and Other Advisories

Company interest means, in relation to the Company's interest in production and reserves, the Company's working interest (operating and non-operating) before the deduction of royalties payable and including such entity's royalty interest in production and reserves. Where volumes of reserves and production have been presented, they have been presented as company working interest, gross of royalties, except where otherwise noted. All operating netbacks referenced in this press release are Company working interest, except where otherwise noted. All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.

Within this press release, references are made to terms commonly used in the oil and natural gas industry. The terms "netback", "operating netback" or "EBITDA" in this press release are not recognized measures under generally accepted accounting principles in Canada. PetroShale uses "netback" as a key performance indicator and it is used by the Company to evaluate the operating performance of its petroleum and natural gas assets and is determined by deducting royalties and production and operating expenses from petroleum and natural gas revenue. EBITDA means earnings before interest, taxes, depletion and depreciation, impairments, finance expense, foreign exchange gain or loss, share-based compensation and other non-cash charges to income. Management believes that in addition to net income (loss), operating netback and EBITDA are useful supplemental measures as they assist in the determination of the Company's operating performance, leverage and liquidity. Readers are cautioned, however, that these measures should not be construed as an alternative to net income (loss) or cash flow from (used in) operating activities determined in accordance with IFRS as an indication of our performance.

This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to aspects of management focus, objectives, strategies and business opportunities. Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend" or similar words suggesting future outcomes, statements that actions, events or conditions "may", "would", "could" or "will" be taken or occur in the future. The forward-looking information is based on certain key expectations and assumptions made by the Company's management, including expectations and assumptions concerning prevailing commodity prices, exchange rates, interest rates, applicable royalty rates and tax laws; future production rates and estimates of operating costs; performance of existing and future wells; reserve and resource volumes; anticipated timing and results of capital expenditures; anticipated timing of the closing and the size of the private placement, and the use of proceeds therefrom; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the state of the economy and the exploration and production business; results of operations; performance; business prospects and opportunities; the availability and cost of financing, labor and services; the impact of increasing competition; ability to market oil and natural gas successfully; the Company's ability to access capital, and obtaining the necessary regulatory approvals, including the approval of the TSX Venture Exchange.

Although the Company believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because the Company can give no assurance that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature they involve inherent risks and uncertainties. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, the forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that the Company will derive therefrom. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide security holders with a more complete perspective on the Company's future operations and such information may not be appropriate for other purposes.

Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect our operations or financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). These forward-looking statements are made as of the date of this press release and the Company disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.

Where amounts are expressed on a barrel of oil equivalent ("boe") basis, natural gas volumes have been converted to boe using a ratio of 6,000 cubic feet of natural gas to one barrel of oil (6 Mcf: 1 Bbl). This boe conversion ratio 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.

Contacts:
PetroShale Inc.
Attention: Executive Chairman and CEO
Email: Info@PetroShaleInc.com
Phone: +1.303.297.1407
www.petroshaleinc.com

Cindy Gray
5 Quarters Investor Relations, Inc.
403.828.0146
cgray@5qir.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
"When you think about the data center today, there's constant evolution, The evolution of the data center and the needs of the consumer of technology change, and they change constantly," stated Matt Kalmenson, VP of Sales, Service and Cloud Providers at Veeam Software, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
Zerto exhibited at SYS-CON's 18th International Cloud Expo®, which took place at the Javits Center in New York City, NY, in June 2016. Zerto is committed to keeping enterprise and cloud IT running 24/7 by providing innovative, simple, reliable and scalable business continuity software solutions. Through the Zerto Cloud Continuity Platform™, organizations can seamlessly move and protect virtualized workloads between public, private and hybrid clouds. The company’s flagship product, Zerto Virtual...
WebRTC defines no default signaling protocol, causing fragmentation between WebRTC silos. SIP and XMPP provide possibilities, but come with considerable complexity and are not designed for use in a web environment. In his session at @ThingsExpo, Matthew Hodgson, technical co-founder of the Matrix.org, discussed how Matrix is a new non-profit Open Source Project that defines both a new HTTP-based standard for VoIP & IM signaling and provides reference implementations.
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
We all know that data growth is exploding and storage budgets are shrinking. Instead of showing you charts on about how much data there is, in his General Session at 17th Cloud Expo, Scott Cleland, Senior Director of Product Marketing at HGST, showed how to capture all of your data in one place. After you have your data under control, you can then analyze it in one place, saving time and resources.
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
910Telecom exhibited at the 19th International Cloud Expo, which took place at the Santa Clara Convention Center in Santa Clara, CA, in November 2016. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and exchanges.
SYS-CON Events announced today that Linux Academy, the foremost online Linux and cloud training platform and community, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Linux Academy was founded on the belief that providing high-quality, in-depth training should be available at an affordable price. Industry leaders in quality training, provided services, and student certification passes, its goal is to c...
Web Real-Time Communication APIs have quickly revolutionized what browsers are capable of. In addition to video and audio streams, we can now bi-directionally send arbitrary data over WebRTC's PeerConnection Data Channels. With the advent of Progressive Web Apps and new hardware APIs such as WebBluetooh and WebUSB, we can finally enable users to stitch together the Internet of Things directly from their browsers while communicating privately and securely in a decentralized way.
The IoT industry is now at a crossroads, between the fast-paced innovation of technologies and the pending mass adoption by global enterprises. The complexity of combining rapidly evolving technologies and the need to establish practices for market acceleration pose a strong challenge to global enterprises as well as IoT vendors. In his session at @ThingsExpo, Clark Smith, senior product manager for Numerex, discussed how Numerex, as an experienced, established IoT provider, has embraced a new m...
Niagara Networks exhibited at the 19th International Cloud Expo, which took place at the Santa Clara Convention Center in Santa Clara, CA, in November 2016. Niagara Networks offers the highest port-density systems, and the most complete Next-Generation Network Visibility systems including Network Packet Brokers, Bypass Switches, and Network TAPs.
A look across the tech landscape at the disruptive technologies that are increasing in prominence and speculate as to which will be most impactful for communications – namely, AI and Cloud Computing. In his session at 20th Cloud Expo, Curtis Peterson, VP of Operations at RingCentral, will highlight the current challenges of these transformative technologies and share strategies for preparing your organization for these changes. This “view from the top” will outline the latest trends and developm...
Due of the rise of Hadoop, many enterprises are now deploying their first small clusters of 10 to 20 servers. At this small scale, the complexity of operating the cluster looks and feels like general data center servers. It is not until the clusters scale, as they inevitably do, when the pain caused by the exponential complexity becomes apparent. We've seen this problem occur time and time again. In his session at Big Data Expo, Greg Bruno, Vice President of Engineering and co-founder of StackIQ...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. 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 June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...