Welcome!

News Feed Item

Chinook Energy Announces Completion of the Disposition of Its Tunisian Assets and Expansion of 2014 Capital Program

CALGARY, ALBERTA -- (Marketwired) -- 08/19/14 -- Chinook Energy Inc. (TSX:CKE) ("Chinook" or the "Company") is pleased to announce that its wholly-owned subsidiary, Storm Ventures International (BVI) Limited ("Storm BVI"), has completed the previously announced disposition, effective January 1, 2014, of all of the issued and outstanding shares of Storm Ventures International (Barbados) Limited, which directly and indirectly owns all of Chinook's Tunisian assets for gross proceeds of US$127.7 million (including positive working capital of approximately US$13.7 million) (the "Transaction") to Medco Tunisia Petroleum Limited.

As a pure domestic focused company with no debt, positive working capital and a recently expanded credit facility of $125 million, Chinook is well positioned to accelerate the development of its recently announced Montney successes at Birley/Umbach where the Company holds 54 (45 net) sections of land, and at Grande Prairie where the Company holds 80 (50 net) sections of land. Chinook also anticipates that it will continue with its successful Dunvegan development drilling program at Karr and Albright in the Grande Prairie area where it plans further activity across four additional Company-owned Dunvegan pools. Strategic acquisitions within the Company's core areas will also become a focus for Chinook.

Chinook had the following pro-forma operational and financial attributes following completion of the Transaction:

---------------------------------------------------------------------------
---------------------------------------------------------------------------
Post-Transaction Corporate Summary                                Pro-forma
---------------------------------------------------------------------------
---------------------------------------------------------------------------
  Forecasted average 2014 production (boe per day) (1)        7,750 - 8,250
  Forecasted cash flow for 2014 (Cdn.$mm)                       58.0 - 60.0
  Forecasted capital expenditures for 2014 (Cdn.$mm)                   81.0
  Estimated working capital as at July 31, 2014                            
   (Cdn.$mm) (2)                                                       35.0
  Estimated proved reserves effective December 31, 2013                    
   (mmboe) (3)                                                         16.0
  Estimated proved plus probable reserves effective                        
   December 31, 2013 (mmboe) (3)                                       25.1
---------------------------------------------------------------------------
---------------------------------------------------------------------------

Notes:

1.  Based on the anticipated effects of Chinook's drilling program for the
    remainder of 2014. 
2.  Reflects estimated positive working capital at July 31, 2014 assuming
    closing of the Transaction occurred on July 31, 2014, inclusive of
    estimated Transaction costs and based on a US$ to Cdn.$ exchange rate of
    US$1.00 = Cdn.$1.09 as at July 31, 2014. 
3.  Based upon the reserve report prepared by the Company's independent
    reserves evaluator, McDaniel & Associates Consultants Ltd., effective
    December 31, 2013 in respect of the Company's Canadian oil and gas
    interests owned as at such date. Reflects "gross" reserves as such term
    is defined in the COGE Handbook. 

Expanded 2014 Capital Program

The net proceeds of the Transaction will initially be applied to eliminate Chinook's bank indebtedness and to fund an expansion of Chinook's 2014 Canadian capital program from $60 million to a total of $81 million. A portion of the expanded capital program will fund additional drilling activity on Chinook's acreage in the Birley/Umbach area of northeast British Columbia and in the Grande Prairie area of northwest Alberta, along with the front end costs associated with a facility expansion at Birley/Umbach.

The Company plans to release its 2015 capital program and guidance in late October.

About Chinook Energy Inc.

Chinook is a Calgary-based public oil and gas exploration and development company with multi-zone conventional production and resource plays in western Canada.

Reader Advisory

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 use of the net proceeds of the Transaction, post-Transaction strategy, plans, opportunities and operations; the volume and product mix of Chinook's oil and gas production; production estimates including 2014 forecast average production; and future development, exploration, acquisition and development activities and related capital expenditures and the timing thereof and the timing for the release of the Company's 2015 capital program and guidance. In addition, information and statements herein relating to "reserves" are deemed to be forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future.

Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Chinook which have been used to develop such statements and information but which may prove to be incorrect. Although Chinook 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 Chinook 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 timely receipt of any required regulatory approvals; the ability of Chinook 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 Chinook has an interest in to operate the field in a safe, efficient and effective manner; the ability of Chinook to obtain financing on acceptable terms; field production rates and decline rates; anticipated production volumes; 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 Chinook 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 Chinook operates; the ability of Chinook to successfully market its oil and natural gas products. To the extent such estimate constitutes a financial outlook, it is included herein to provide readers with an understanding of estimated capital expenditures and the effect thereof on debt levels and readers are cautioned that the information may not be appropriate for other purposes.

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; changes in the demand for or supply of Chinook's products; unanticipated operating results or production declines; incorrect assessments of capital expenditures, cash flows and Transaction costs, changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Chinook or by third party operators of Chinook's properties, increased debt levels or debt service requirements; inaccurate estimation of Chinook's oil and gas reserve 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 Chinook's public disclosure documents (including, without limitation, those risks identified in this news release and Chinook'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 Chinook 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.

Reserves

The recovery and reserves estimates contained herein are estimates only and there is no guarantee that the estimated reserves will be recovered.

BOE Equivalent

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.

Future Oriented Financial Information

This news release, in particular the information in respected of the Company's anticipated cash flows for the purposes of determining the Company's anticipated positive working capital position subsequent to the Transaction, may contain Future Oriented Financial Information ("FOFI") within the meaning of applicable securities laws. The FOFI has been prepared by management of the Company to provide an outlook of the Company's activities and results and may not be appropriate for other purposes. The FOFI has been prepared based on a number of assumptions including the assumptions discussed under the heading "Forward-Looking Information and Statements" and assumptions with respect to production rates, drilling results, commodity prices and exchange rates. The actual results of operations of the Company and the resulting financial results may vary from the amounts set forth herein, and such variations may be material. The Company and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments.

Contacts:
Chinook Energy Inc.
Walter Vrataric
President and Chief Executive Officer
(403) 261-6883

Chinook Energy Inc.
Jason Dranchuk
Vice President, Finance and Chief Financial Officer
(403) 261-6883
www.chinookenergyinc.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
The 22nd International Cloud Expo | 1st DXWorld Expo has announced that its Call for Papers is open. Cloud Expo | DXWorld Expo, to be held June 5-7, 2018, at the Javits Center in New York, NY, brings together Cloud Computing, Digital Transformation, Big Data, Internet of Things, DevOps, Machine Learning 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 busin...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
SYS-CON Events announced today that Synametrics Technologies will exhibit at SYS-CON's 22nd International Cloud Expo®, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. Synametrics Technologies is a privately held company based in Plainsboro, New Jersey that has been providing solutions for the developer community since 1997. Based on the success of its initial product offerings such as WinSQL, Xeams, SynaMan and Syncrify, Synametrics continues to create and hone in...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, discussed some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he covered some of the best practices for structured team migration an...
No hype cycles or predictions of a gazillion things here. IoT is here. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, an Associate Partner of Analytics, IoT & Cybersecurity at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He also discussed the evaluation of communication standards and IoT messaging protocols, data...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, examined the regulations and provided insight on how it affects technology, challenges the established rules and will usher in new levels of diligence arou...
Most technology leaders, contemporary and from the hardware era, are reshaping their businesses to do software. They hope to capture value from emerging technologies such as IoT, SDN, and AI. Ultimately, irrespective of the vertical, it is about deriving value from independent software applications participating in an ecosystem as one comprehensive solution. In his session at @ThingsExpo, Kausik Sridhar, founder and CTO of Pulzze Systems, discussed how given the magnitude of today's application ...
The “Digital Era” is forcing us to engage with new methods to build, operate and maintain applications. This transformation also implies an evolution to more and more intelligent applications to better engage with the customers, while creating significant market differentiators. In both cases, the cloud has become a key enabler to embrace this digital revolution. So, moving to the cloud is no longer the question; the new questions are HOW and WHEN. To make this equation even more complex, most ...
As you move to the cloud, your network should be efficient, secure, and easy to manage. An enterprise adopting a hybrid or public cloud needs systems and tools that provide: Agility: ability to deliver applications and services faster, even in complex hybrid environments Easier manageability: enable reliable connectivity with complete oversight as the data center network evolves Greater efficiency: eliminate wasted effort while reducing errors and optimize asset utilization Security: imple...
Mobile device usage has increased exponentially during the past several years, as consumers rely on handhelds for everything from news and weather to banking and purchases. What can we expect in the next few years? The way in which we interact with our devices will fundamentally change, as businesses leverage Artificial Intelligence. We already see this taking shape as businesses leverage AI for cost savings and customer responsiveness. This trend will continue, as AI is used for more sophistica...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
Digital transformation is about embracing digital technologies into a company's culture to better connect with its customers, automate processes, create better tools, enter new markets, etc. Such a transformation requires continuous orchestration across teams and an environment based on open collaboration and daily experiments. In his session at 21st Cloud Expo, Alex Casalboni, Technical (Cloud) Evangelist at Cloud Academy, explored and discussed the most urgent unsolved challenges to achieve f...
In his session at 21st Cloud Expo, Raju Shreewastava, founder of Big Data Trunk, provided a fun and simple way to introduce Machine Leaning to anyone and everyone. He solved a machine learning problem and demonstrated an easy way to be able to do machine learning without even coding. Raju Shreewastava is the founder of Big Data Trunk (www.BigDataTrunk.com), a Big Data Training and consulting firm with offices in the United States. He previously led the data warehouse/business intelligence and B...
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, discussed how they built...