Bengal Energy Announces Fiscal 2019 Third Quarter Results
2019年2月14日 - 8:50AM
Bengal Energy Ltd. (TSX: BNG) (“Bengal” or the
“Company”) today announces its financial results for the third
quarter of fiscal 2019 ended December 31, 2018.
THIRD QUARTER FISCAL 2019
SUMMARY
Financial Summary:
- Sales Revenue – Crude oil sales revenue was
$2.0 million in Q3 fiscal 2019, which is 37% lower than the $3.2
million recorded in Q3 fiscal 2018 and 39% lower than Q2 fiscal
2019, mainly due to a decline in US Brent pricing and oil
production.
- Hedging – The Company’s credit facility
requires that a minimum of 50% of oil production be hedged forward
by a minimum of 12 months. Q3 fiscal 2019 was burdened with a hedge
of US$47/bbl. The quarter ending March 31, 2019 has hedges in place
at $US 55.40/bbl while the two subsequent quarters have a portion
of expected production hedged at over $US 72/bbl. For the quarter
ending December 31, 2019 a portion of production has been hedged
using puts and swaps at $US 54.20/bbl.
- Funds from Operations – Bengal generated a use
of funds from operations of $0.2 million in Q3 fiscal 2019, a $1.5
million decline from the $1.3 million funds from operations
generated in Q3 fiscal 2018. The primary reason for the decrease in
funds performance in Q3 fiscal 2019 was the significant decline in
US Brent pricing.
- Net Income – Bengal reported net income of
$0.9 million for Q3 fiscal 2019 compared to net income of $0.2
million in the third Q3 fiscal 2018. The primary driver for this
positive result was the positive change in the unrealized gain on
financial instruments which resulted from lower oil prices that
were entered into to hedge the Company’s oil pricing.
- Adjusted Net Loss – Bengal reported net income
(loss) of $0.9 million for Q3 fiscal 2019. Adjusting the Q3 fiscal
2019 net income for unrealized gain on financial instruments, the
unrealized foreign exchange loss for the period and the non-cash
impairment of non-current assets, the adjusted net loss is $0.6
million for Q3 fiscal 2019 compared to adjusted net income of $0.7
million for Q3 fiscal 2018.
Operational Summary:
- Production Volumes – The Company’s share of
total production in Q3 fiscal 2019 was 27,593 bbls, which is a 15%
decline from the 32,594 bbls produced in the third quarter fiscal
2018. Q3 fiscal 2019 production averaged 300 bbls per day compared
to 354 bbls per day produced in the third quarter 2018 and 292 bbls
per day produced in the second quarter fiscal 2019. Normal
production declines and reduced capital spending are the reason for
the reduction in production for year over year. Production
increased in Q3 fiscal 2019 from the second quarter of fiscal 2019
as increased volumes from fracturing in Q3 fiscal 2019 more than
offset normal sequential declines.
- Development - Bengal reported development and
production expenditures of $0.3 million, which primarily relates to
connect costs related to the fracking of the Cuisinier-19 well
during Q3 fiscal 2019.
Outlook:
During the second half of calendar 2018, the
Company’s joint venture on Barta Block Cuisinier PL 303 (the “Joint
Venture”) conducted a fracture stimulation campaign on four
wells. Three of the four wells were successful and the
Cuisinier North-1, Shefu-1 and Cuisinier-24 wells were brought
online in September. The Cuisinier-19 well was fracced in a
later program during Q3 fiscal 2019 but was unsuccessful. In
December 2018, aggregate production from the successful wells was
approximately 203 bbls/d (a 118% increase from the pre frac
rates).
The Company’s fiscal 2019 drilling campaign
commenced in February of 2019 and consists of four development
wells and one appraisal well within PL 303. The goal of the
program is to add production, expand the Cuisinier pool area and
thus increase reserves. The Company will use internally
generated sources of cash to fund this drilling campaign. The
Joint Venture has also initiated the implementation of a pilot
pressure maintenance scheme, which is planned to commence during
the second quarter of calendar 2019. The location of this
pilot is in the southeast quadrant of the Cuisinier pool, with
injection of water to take place at the Cuisinier-24 well.
The injection of produced formation water is anticipated to
generate a positive response in production performance of up to
four offsetting producing wells. In addition, the planned
program will also complement future water flood expansion phases
currently in the initial planning stages.
FINANCIAL RESULTS |
|
|
|
|
|
|
|
|
|
|
|
($000s except per share, %, |
|
|
|
volumes
and netback amounts) |
Three months ended |
|
Nine months ended |
|
December 31 |
|
December 31 |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
Oil revenue |
$ |
2,014 |
|
$ |
3,211 |
|
$ |
8,544 |
|
$ |
7,927 |
Operating netback(1) |
$ |
622 |
|
$ |
2,057 |
|
$ |
3,836 |
|
$ |
5,636 |
Cash
from operations |
$ |
434 |
|
$ |
431 |
|
$ |
2,056 |
|
$ |
2,769 |
Funds
(used in) from operations(2) |
$ |
(247 |
) |
$ |
1,268 |
|
$ |
1,378 |
|
$ |
3,212 |
Per share
($) (basic and diluted) |
$ |
0.00 |
|
$ |
0.01 |
|
$ |
0.01 |
|
$ |
0.03 |
Net
income (loss) |
$ |
883 |
|
$ |
206 |
|
$ |
(331 |
) |
$ |
255 |
Per share
($) (basic and diluted) |
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.00 |
|
$ |
0.00 |
Adjusted net income (loss)(3) |
$ |
(649 |
) |
$ |
698 |
|
$ |
128 |
|
$ |
1,602 |
Per share
($) (basic and diluted) |
$ |
(0.01 |
) |
$ |
0.01 |
|
$ |
0.00 |
|
$ |
0.02 |
Capital expenditures |
$ |
298 |
|
$ |
342 |
|
$ |
1,873 |
|
$ |
2,572 |
Oil
volumes (bbl/d) |
|
300 |
|
|
354 |
|
|
303 |
|
|
369 |
Netback(1)($/bbl) |
$ |
22.54 |
|
$ |
63.12 |
|
$ |
45.99 |
|
$ |
55.58 |
- Netback is a non-IFRS measure and includes realized gain on
financial instruments. Netback per bbl is calculated by dividing
revenue (including realized gain (loss) on financial instruments)
less royalties and operating costs by the total production of the
Company measured in bbls. A reconciliation of the measures can be
found in the table on page 8 of Bengal's management's discussion
and analysis for the three and nine months ended December 31,
2019.
- Funds from operations per share is a non-IFRS measure
calculated as calculated by dividing funds from operations by
weighted average basic and diluted shares outstanding for the
periods disclosed. A reconciliation of the measures can be found in
the table on page 18 of Bengal's management's discussion and
analysis for the three and nine months ended December 31,
2019.
- Adjusted net income (loss) and adjusted net income (loss) per
share are non-IFRS measures. The comparable IFRS measure is net
income (loss). A reconciliation of the two measures can be found in
the table on page 18 of Bengal's management's discussion and
analysis for the three and nine months ended December 31,
2019.
- The above non-IFRS measures do not have any standardized
meaning under Bengal's GAAP (as that term is defined in National
Instrument 52-107 Acceptable Accounting Principles and Auditing
Standards) and therefore may not be comparable to similar measures
presented by other issuers.
Bengal has filed its consolidated financial
statements and management’s discussion and analysis for the third
fiscal quarter of 2019 with the Canadian securities regulators. The
documents are available on SEDAR at www.sedar.com or by visiting
Bengal’s website at www.bengalenergy.ca.
About Bengal
Bengal Energy Ltd. is an international junior
oil and gas exploration and production company with assets in
Australia. The Company is committed to growing shareholder value
through international exploration, production and acquisitions.
Bengal’s common shares trade on the TSX under the symbol “BNG.”
Additional information is available at www.bengalenergy.ca .
Forward-Looking Statements
This news release contains certain
forward-looking statements or information ("forward-looking
statements”) as defined by applicable securities laws that involve
substantial known and unknown risks and uncertainties, many of
which are beyond Bengal's control. These statements relate to
future events or our future performance. All statements other than
statements of historical fact may be forward-looking statements.
The use of any of the words "plan", "expect", "prospective",
"project", "intend", "believe", "should", "anticipate", "estimate",
or other similar words or statements that certain events "may" or
"will" occur are intended to identify forward-looking statements.
The projections, estimates and beliefs contained in such
forward-looking statements are based on management’s estimates,
opinions, and assumptions at the time the statements were made,
including assumptions relating to: the impact of economic
conditions in North America and Australia and globally; industry
conditions; changes in laws and regulations including, without
limitation, the adoption of new environmental laws and regulations
and changes in how they are interpreted and enforced; increased
competition; the availability of qualified operating or management
personnel; fluctuations in commodity prices, foreign exchange or
interest rates; stock market volatility and fluctuations in market
valuations of companies with respect to announced transactions and
the final valuations thereof; results of exploration and testing
activities; and the ability to obtain required approvals and
extensions from regulatory authorities. We believe the expectations
reflected in those forward-looking statements are reasonable but,
no assurances can be given that any of the events anticipated by
the forward-looking statements will transpire or occur, or if any
of them do so, what benefits that Bengal will derive from them. As
such, undue reliance should not be placed on forward-looking
statements.
Forward-looking statements contained herein
include, but are not limited to, statements regarding: Bengal's
hedging program; the potential of future fracture stimulation to
improve initial production rates on the stimulated wells; the
expected timing of the implementation of a pilot pressure
maintenance scheme. The forward-looking statements contained herein
are subject to numerous known and unknown risks and uncertainties
that may cause Bengal’s actual financial results, performance or
achievement in future periods to differ materially from those
expressed in, or implied by, these forward-looking statements,
including but not limited to, risks associated with: liabilities
inherent in oil and natural gas operations; the failure to obtain
required regulatory approvals or extensions; failure to satisfy the
conditions under farm-in and joint venture agreements; failure to
secure required equipment and personnel; changes in general global
economic conditions including, without limitations, the economic
conditions in North America and Australia; uncertainties associated
with estimating oil and natural gas reserves; increased competition
for, among other things: capital, acquisitions of reserves,
undeveloped lands and skilled personnel; the availability of
qualified operating or management personnel; incorrect assessment
of the value of acquisitions; fluctuations in commodity prices,
foreign exchange or interest rates; inability to meet commitments
due to inability to raise funds or complete farm-outs; geological,
technical, drilling and processing problems; changes in laws and
regulations including, without limitation, the adoption of new
environmental, royalty and tax laws and regulations and changes in
how they are interpreted and enforced; Bengal’s development and
exploration opportunities; the results of exploration and
development drilling and related activities; the ability to access
sufficient capital from internal and external sources; and
counter-party credit risk, stock market volatility and market
valuation of Bengal’s stock. Statements relating to "reserves" are
deemed to be forward-looking statements, as they involve the
implied assessment, based on certain estimates and assumptions,
which the reserves described, can be profitably produced in the
future. Readers are encouraged to review the material risks
discussed in Bengal’s Annual Information Form for the year ended
March 31, 2018 under the heading “Risk Factors” and in Bengal’s
Management's Discussion and Analysis for the Q3 fiscal year ending
March 31,2019 under the heading “Risk Factors”. The Company
cautions that the foregoing list of assumptions, risks and
uncertainties is not exhaustive. The forward-looking statements
contained in this news release speak only as of the date hereof and
Bengal does not assume any obligation to publicly update or revise
them to reflect new events or circumstances, except as may be
require pursuant to applicable securities laws.
Certain Defined Terms
bbl – barrelbbls
– barrelsbbls/d –barrels per
day$/bbl – dollars per barrelmcf
– thousand cubic feetQ3 – three months
ended December 31
Non-IFRS Measurements
Within this release, references are made to
terms commonly used in the oil and gas industry. Netbacks, netbacks
per barrel, funds from operations, funds from operations per share,
adjusted net earnings and adjusted net earnings per share do not
have any standardized meaning under IFRS and are referred to as
non-IFRS measures. Netback equals total revenue (including realized
(loss) gain on financial instruments) less royalties and operating
expenses. Netback per barrel equals netback divided by the
applicable number of barrels. Management utilizes these measures
for operational performance. Funds from operations is defined as
cash from operations before changes in non-cash working capital.
Funds from operations per share is a non-IFRS measure calculated by
dividing funds from operations by weighted average basic and
diluted shares outstanding for the periods disclosed. Adjusted net
earnings is a non-IFRS measure, which should not be considered an
alternative to “Net income (loss)” as presented in the consolidated
statement of income (loss) and comprehensive income (loss), and is
presented in the Company’s financial reports to assist management
and investors in analyzing financial performance net of gains and
losses outside of management’s immediate control. Adjusted net
earnings equal net income (loss) less unrealized losses/gains on
foreign exchange and unrealized losses/gains on financial
instruments plus non-cash impairment of non-current assets.
Adjusted net earnings per share is calculated based on the weighted
average number of common shares outstanding consistent with the
calculation of earnings (loss) per share. Management utilizes these
measures to analyze operating performance. The Company’s
calculation of the non-IFRS measures included herein may differ
from the calculation of similar measures by other issuers.
Therefore, the Company’s non-IFRS measures may not be comparable to
other similar measures used by other issuers. Funds from operations
is not intended to represent operating profit for the period nor
should it be viewed as an alternative to operating profit, net
income, cash flow from operations or other measures of financial
performance calculated in accordance with IFRS. Non-IFRS measures
should only be used in conjunction with the Company’s annual
audited and interim financial statements. A reconciliation of these
measures can be found in the table on page 18 of Bengal’s fiscal
2019 Q3 MD&A.
Management believes the presentation of the
Non-IFRS measures above provide useful information to investors and
shareholders as the measures provide increased transparency and the
ability to better analyze performance against prior periods on a
comparable basis.
FOR FURTHER INFORMATION PLEASE
CONTACT:
Bengal Energy
Ltd.Chayan Chakrabarty, President & Chief
Executive OfficerMatthew Moorman, Chief Financial
Officer(403) 205-2526Email:
investor.relations@bengalenergy.ca Website:
www.bengalenergy.ca
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