CALGARY, AB, March 19, 2024 /CNW/ - Alvopetro Energy Ltd.
(TSXV:ALV) (OTCQX: ALVOF) announces our financial results for the
year ended December 31, 2023, a
quarterly dividend of US$0.09 per
common share and filing of our annual information form.
All references herein to $ refer to United States dollars, unless otherwise stated
and all tabular amounts are in thousands of United States dollars, except as otherwise
noted.
Recent Updates
On February 26, 2024, we announced
our December 31, 2023 reserves based
on the independent reserve assessment and evaluation prepared by
GLJ Ltd. ("GLJ") dated February 26,
2024 with an effective date of December 31, 2023 (the "GLJ Reserves and
Resources Report"). Our December 31,
2023 reserves included total proved plus probable reserves
of 8.7 MMboe with a before tax net present value discounted at 10%
of $309.7 million. We also announced
the Murucututu resources assessment with risked best estimate
contingent resource of 5.4 MMboe (before tax net present value
discounted at 10% of $126.1 million)
and risked best estimate prospective resource of 9.6 MMboe (before
tax net present value discounted at 10% of $184.9 million. With respect to the Caburé
natural gas field, the reserves assigned in the GLJ Reserves and
Resource Report are based on Alvopetro's 49.1% working interest as
of December 31, 2023 in the unitized
area (the "Unit") which includes Caburé. As previously announced,
the working interest is subject to redeterminations, the first of
which is currently underway. Alvopetro and its partner in the Unit
have engaged an independent expert (the "Expert") to decide on the
redetermined working interest to each party. The decision of the
Expert is expected near the end of the first quarter of 2024. The
outcome of the Expert's decision and the resulting working interest
to Alvopetro following the decision is uncertain. The resulting
impact on Alvopetro's reserves and future cash flows may be
material and may have a material adverse effect on
Alvopetro.
Alvopetro's daily sales volumes averaged 1,592 boepd In January
and February including 9.1 MMcfpd of natural gas, natural gas
liquids sales from condensate of 75 bopd and oil sales of 14 bopd,
a decrease of 26% from Q4 2023 sales volumes due to reductions in
demand from Bahiagás. Demand resumed in early March and natural gas
sales have averaged 11.2 MMcfpd to date in March based on field
estimates.
Effective February 1, 2024, our natural gas price under our
long-term gas sales agreement with Bahiagás was adjusted to
BRL1.94/m3. Our realized
gas price, net of sales taxes, is approximately $12.36/Mcf
(based on our average heat content to date and the January 31,
2024 BRL/USD foreign exchange rate of
4.95). The contracted price is based on the adjusted
ceiling price of $10.58/MMBtu which increased 0.5% from
the August 1, 2023 price due to the US inflation
adjustment for the six-month period. With the appreciation of the
BRL relative to the USD in the second half of 2023 compared to the
first half of 2023, the BRL contracted price decreased
from BRL1.99/m3 as of August 1,
2023 to BRL1.94/m3 as of February 1,
2024. This price is effective for all natural gas sales
from February 1 to July 31, 2024.
In 2024, Alvopetro is focused on capital projects aimed at
optimizing production rates from our three existing wells on our
100% owned and operated Murucututu natural field with total
forecasted capital expenditures on the field of $4.1 million. We are planning recompletions of
both our 183-A3 well and our 183(1) well, targeting both the
Caruaçu and Gomo Formations along with a project on our 197(1)
well. At the Caburé Unit, Alvopetro and its partner have agreed to
a development plan including drilling and completing five wells in
2024 and 2025. Alvopetro's share of these wells, based on the
December 31, 2023 working interest of
49.1% is estimated at $6.2 million,
with $4.4 million forecasted in 2024.
In addition, Alvopetro has a facilities upgrade planned at the
field for an estimated $3.2 million
relating to compression of natural gas to be delivered to
Alvopetro's 100%-owned natural gas processing facility. On our
exploration assets, Alvopetro has planned a stimulation of the
183-B1 well on Block 183 to improve recovery rates.
Financial and Operating Highlights – Fourth Quarter of
2023
- Our daily sales averaged 2,143 boepd during the quarter, an
increase of 26% from Q3 2023 which had been impacted by lower
demand from Bahiagás and a decrease of 21% from Q4 2022 due to
reduced natural gas availability from the Caburé natural gas field
following increased nominations from our partner on the field.
- Our average realized natural gas price increased to
$12.85/Mcf, a 15% increase from Q4
2022 with the 3% increase in our contracted BRL-denominated natural
gas price, enhanced sales tax credits available in 2023 and a 6%
appreciation in the average BRL to USD in Q4 2023 compared to Q4
2022. With the higher natural gas price, our overall realized price
per boe was $77.60 (+14% from Q4
2022).
- Our natural gas, condensate and oil revenue was $15.3 million in Q4 2023, a decrease of
$1.8 million (-10%) compared to Q4
2022 and an increase of $3.0 million
(+24%) compared to Q3 2023.
- Our operating netback in the quarter was $69.69 per boe (+$9.61 per boe from Q4 2022) with
higher realized sales prices and lower royalties, partially offset
by the impact of fixed operating costs with lower sales
volumes.
- We generated funds flows from operations of $12.4 million ($0.33 per basic and per diluted share), a
decrease of $0.8 million compared to
Q4 2022 and an increase of $2.8
million compared to Q3 2023.
- We reported net income of $0.7
million in Q4 2023, a decrease of $4.5 million compared to Q4 2022 and a decrease
of $5.2 million compared to Q3 2023.
Net income in Q4 2023 included impairment losses of $11.0 million (Q4 2022 - $6.3 million).
- Capital expenditures totaled $4.9
million, including drilling and completion costs for the
183-A3 well on our Murucututu natural gas field, completion costs
for the BL-06 well on our Bom Lugar field, and long-lead purchases
for future capital projects.
- Our working capital surplus was $13.1
million as of December 31,
2023, increasing $1.7 million
from September 30, 2023, and
decreasing $1.6 million from
December 31, 2022.
Financial and Operating Highlights – Year Ended December 31, 2023
- Our annual sales averaged 2,142 boepd (95% natural gas, 5% NGLs
from condensate and marginal crude oil production), a decrease of
16% compared to 2022.
- We reported net income of $28.5
million, compared to $31.7
million in 2022 (-10%).
- We generated funds flow from operations of $48.0 million ($1.29 per basic share and $1.27 per diluted share), a decrease of
$1.8 million compared to 2022.
- Capital expenditures totaled $27.4
million in 2023.
- Dividends declared totaled $0.56
per share in 2023 compared to $0.36
per share in 2022 (+56%).
The following table provides a summary of Alvopetro's financial
and operating results for the periods noted. The consolidated
financial statements with the Management's Discussion and Analysis
("MD&A") are available on our website at www.alvopetro.com and
will be available on the SEDAR+ website at www.sedarplus.ca.
|
As at and Three
Months Ended
December
31,
|
As at and Year
Ended
December
31,
|
|
2023
|
2022
|
Change (%)
|
2023
|
2022
|
Change (%)
|
|
Financial
|
|
|
|
|
|
|
|
($000s, except
where noted)
|
|
|
|
|
|
|
|
Natural gas, oil and
condensate sales
|
15,300
|
17,077
|
(10)
|
59,687
|
63,508
|
(6)
|
|
Net income
|
652
|
5,191
|
(87)
|
28,525
|
31,732
|
(10)
|
|
Per share – basic
($)(1)
|
0.02
|
0.14
|
(86)
|
0.77
|
0.92
|
(16)
|
|
Per share – diluted
($)(1)
|
0.02
|
0.14
|
(86)
|
0.76
|
0.86
|
(12)
|
|
Cash flows from
operating activities
|
7,904
|
12,366
|
(36)
|
47,702
|
47,534
|
-
|
|
Per share – basic
($)(1)
|
0.21
|
0.34
|
(38)
|
1.29
|
1.37
|
(6)
|
|
Per share – diluted
($)(1)
|
0.21
|
0.33
|
(36)
|
1.26
|
1.29
|
(2)
|
|
Funds flow from
operations (2)
|
12,393
|
13,193
|
(6)
|
48,030
|
49,879
|
(4)
|
|
Per share – basic
($)(1)
|
0.33
|
0.36
|
(8)
|
1.29
|
1.44
|
(10)
|
|
Per share – diluted
($)(1)
|
0.33
|
0.35
|
(6)
|
1.27
|
1.35
|
(6)
|
|
Dividends
declared
|
5,127
|
4,357
|
18
|
20,462
|
12,697
|
61
|
|
Per
share(1)
|
0.14
|
0.12
|
17
|
0.56
|
0.36
|
56
|
|
Capital
expenditures
|
4,934
|
5,944
|
(17)
|
27,449
|
24,795
|
11
|
|
Cash and cash
equivalents
|
18,326
|
19,784
|
(7)
|
18,326
|
19,784
|
(7)
|
|
Net working
capital(2)
|
13,117
|
14,698
|
(11)
|
13,117
|
14,698
|
(11)
|
|
Weighted average shares
outstanding
|
|
|
|
|
|
|
|
Basic
(000s)(1)
|
37,262
|
36,231
|
3
|
37,121
|
34,642
|
7
|
|
Diluted
(000s)(1)
|
37,963
|
37,298
|
2
|
37,770
|
36,919
|
2
|
|
Operations
|
|
|
|
|
|
|
|
Natural gas, NGLs and
crude oil sales:
|
|
|
|
|
|
|
|
Natural gas (Mcfpd),
by field:
|
|
|
|
|
|
|
|
Caburé (Mcfpd)
|
11,699
|
15,329
|
(24)
|
11,742
|
14,592
|
(20)
|
|
Murucututu (Mcfpd)
|
546
|
217
|
152
|
487
|
55
|
785
|
|
Total natural gas
(Mcfpd)
|
12,245
|
15,546
|
(21)
|
12,229
|
14,647
|
(17)
|
|
NGLs – condensate (bopd)
|
92
|
128
|
(28)
|
99
|
110
|
(10)
|
|
Oil (bopd)
|
10
|
5
|
100
|
6
|
6
|
-
|
|
Total
(boepd)
|
2,143
|
2,724
|
(21)
|
2,142
|
2,557
|
(16)
|
|
|
|
|
|
|
|
|
Average realized
prices(2):
|
|
|
|
|
|
|
|
Natural gas ($/Mcf)
|
12.85
|
11.18
|
15
|
12.64
|
11.07
|
14
|
|
NGLs – condensate ($/bbl)
|
89.45
|
89.29
|
-
|
86.29
|
103.50
|
(17)
|
|
Oil ($/bbl)
|
73.67
|
79.50
|
(7)
|
71.22
|
82.67
|
(14)
|
|
Total ($/boe)
|
77.60
|
68.13
|
14
|
76.33
|
68.04
|
12
|
|
|
|
|
|
|
|
|
Operating netback
($/boe)(2)
|
|
|
|
|
|
|
|
Realized sales
price
|
77.60
|
68.13
|
14
|
76.33
|
68.04
|
12
|
|
Royalties
|
(2.07)
|
(4.15)
|
(50)
|
(2.13)
|
(4.81)
|
(56)
|
|
Production
expenses
|
(5.84)
|
(3.90)
|
50
|
(5.38)
|
(3.80)
|
42
|
|
Operating
netback
|
69.69
|
60.08
|
16
|
68.82
|
59.43
|
16
|
|
Operating netback
margin(2)
|
90 %
|
88 %
|
2
|
90 %
|
87 %
|
3
|
|
Notes:
|
|
(1)
|
Per share amounts are
based on weighted average shares outstanding other than dividends
per share, which is based on the number of common shares
outstanding at each dividend record date. The weighted average
number of diluted common shares outstanding in the computation of
funds flow from operations and cash flows from operating activities
per share is the same as for net income per share.
|
|
(2)
|
See "Non-GAAP and
Other Financial Measures" section within this news
release.
|
Quarterly Dividend of US$0.09 per Share
With lower production levels forecast in the first quarter of
2024 and consistent with our long standing balanced stakeholder
return model, our Board of Directors determined it was appropriate
to reduce the quarterly dividend and declared a quarterly dividend
of US$0.09 per common share, payable in cash
on April 15, 2024, to shareholders of record at the close of
business on March 28, 2024. This dividend is designated as an
"eligible dividend" for Canadian income tax purposes.
Dividend payments to non-residents of Canada will be
subject to withholding taxes at the Canadian statutory rate of
25%. Shareholders may be entitled to a reduced withholding
tax rate under a tax treaty between their country of residence and
Canada. For further information, see Alvopetro's website at
https://alvopetro.com/Dividends-Non-resident-Shareholders.
Annual Information Form
Alvopetro has filed its annual information form ("AIF") with the
Canadian securities regulators on SEDAR+. The AIF includes the
disclosure and reports relating to oil and gas reserves data and
other oil and gas information required pursuant to National
Instrument 51-101 of the Canadian Securities Administrators. The
AIF may be accessed electronically at www.sedarplus.ca and on our
website at www.alvopetro.com.
2023 Results Webcast
Alvopetro will host a live webcast to discuss our 2023 financial
results at 8:00 am Mountain time on
Wednesday March 20, 2024. Details for joining the event are
as follows:
Date: March 20,
2024
Time: 8:00 AM
Mountain/10:00 AM Eastern
Link: https://us06web.zoom.us/j/83920744797
Dial-in numbers: https://us06web.zoom.us/u/kdcVycQytc
Webinar ID: 839 2074 4797
The webcast will include a question-and-answer period. Online
participants will be able to ask questions through the Zoom portal.
Dial-in participants can email questions directly to
socialmedia@alvopetro.com.
Corporate Presentation
Alvopetro's updated corporate presentation is available on our
website at:
http://www.alvopetro.com/corporate-presentation.
Social Media
Follow Alvopetro on our social media channels at the following
links:
Twitter -
https://twitter.com/AlvopetroEnergy
Instagram - https://www.instagram.com/alvopetro/
LinkedIn -
https://www.linkedin.com/company/alvopetro-energy-ltd
Alvopetro Energy Ltd.'s vision is to
become a leading independent upstream and midstream operator in
Brazil. Our strategy is to unlock
the on-shore natural gas potential in the state of Bahia
in Brazil, building
off the development of our Caburé and Murucututu natural gas fields
and our strategic midstream infrastructure.
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 news release.
Abbreviations:
|
$000s
|
=
|
thousands of U.S.
dollars
|
|
boepd
|
=
|
barrels of oil
equivalent ("boe") per day
|
|
bopd
|
=
|
barrels of oil and/or
natural gas liquids (condensate) per day
|
|
BRL
|
=
|
Brazilian
Real
|
|
Mcf
|
=
|
thousand cubic
feet
|
|
Mcfpd
|
=
|
thousand cubic feet per
day
|
|
MMcf
|
=
|
million cubic
feet
|
|
MMcfpd
|
=
|
million cubic feet per
day
|
|
NGLs
|
=
|
natural gas liquids
(condensate)
|
|
Q3 2023
|
=
|
three months ended
September 30, 2023
|
|
Q4 2022
|
=
|
three months ended
December 31, 2022
|
|
Q4 2023
|
=
|
three months ended
December 31, 2023
|
|
USD
|
=
|
United States
dollars
|
|
GAAP
|
=
|
IFRS Accounting
Standards
|
Non-GAAP and Other Financial Measures
This news release contains references to various non-GAAP
financial measures, non-GAAP ratios, capital management measures
and supplementary financial measures as such terms are defined in
National Instrument 52-112 Non-GAAP and Other Financial Measures
Disclosure. Such measures are not recognized measures under
GAAP and do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by
other issuers. While these measures may be common in the oil and
gas industry, the Company's use of these terms may not be
comparable to similarly defined measures presented by other
companies. The non-GAAP and other financial measures referred to in
this report should not be considered an alternative to, or more
meaningful than measures prescribed by IFRS and they are not meant
to enhance the Company's reported financial performance or
position. These are complementary measures that are used by
management in assessing the Company's financial performance,
efficiency and liquidity and they may be used by investors or other
users of this document for the same purpose. Below is a description
of the non-GAAP financial measures, non-GAAP ratios, capital
management measures and supplementary financial measures used in
this news release. For more information with respect to financial
measures which have not been defined by GAAP, including
reconciliations to the closest comparable GAAP measure, see the
"Non-GAAP Measures and Other Financial Measures" section of
the Company's MD&A which may be accessed through the SEDAR+
website at www.sedarplus.ca.
Non-GAAP Financial Measures
Operating netback
Operating netback is calculated as natural gas, oil and
condensate revenues less royalties and production expenses. This
calculation is provided in the "Operating Netback" section
of the Company's MD&A using our IFRS measures. The Company's
MD&A may be accessed through the SEDAR+ website at
www.sedarplus.ca. Operating netback is a common metric used in the
oil and gas industry used to demonstrate profitability from
operations.
Non-GAAP Financial Ratios
Operating netback per boe
Operating netback is calculated on a per unit basis, which is
per barrel of oil equivalent ("boe"). It is a common non-GAAP
measure used in the oil and gas industry and management believes
this measurement assists in evaluating the operating performance of
the Company. It is a measure of the economic quality of the
Company's producing assets and is useful for evaluating variable
costs as it provides a reliable measure regardless of fluctuations
in production. Alvopetro calculated operating netback per boe as
operating netback divided by total sales volumes (boe). This
calculation is provided in the "Operating Netback" section
of the Company's MD&A using our IFRS measures. The Company's
MD&A may be accessed through the SEDAR+ website at
www.sedarplus.ca. Operating netback is a common metric used in the
oil and gas industry used to demonstrate profitability from
operations on a per boe basis.
Operating netback margin
Operating netback margin is calculated as operating netback per
boe divided by the realized sales price per boe. Operating netback
margin is a measure of the profitability per boe relative to
natural gas, oil and condensate sales revenues per boe and is
calculated as follows:
|
Three Months
Ended
December
31,
|
Year
Ended
December
31,
|
|
2023
|
2022
|
2023
|
2022
|
|
Operating netback - $
per boe
|
69.69
|
60.08
|
68.82
|
59.43
|
|
Average realized price
- $ per boe
|
77.60
|
68.13
|
76.33
|
68.04
|
|
Operating netback
margin
|
90 %
|
88 %
|
90 %
|
87 %
|
Funds Flow from Operations Per Share
Funds flow from operations per share is a non-GAAP ratio that
includes all cash generated from operating activities and is
calculated before changes in non-cash working capital, divided by
the weighted the weighted average shares outstanding for the
respective period. For the periods reported in this news release
the cash flows from operating activities per share and funds flow
from operations per share is as follows:
|
Three Months
Ended
December
31,
|
Year
Ended
December
31,
|
|
$ per
share
|
2023
|
2022
|
2023
|
2022
|
|
Per basic
share:
|
|
|
|
|
|
Cash flows from
operating activities
|
0.21
|
0.34
|
1.29
|
1.37
|
|
Funds flow from
operations
|
0.33
|
0.36
|
1.29
|
1.44
|
|
|
|
|
|
|
Per diluted
share:
|
|
|
|
|
|
Cash flows from
operating activities
|
0.21
|
0.33
|
1.26
|
1.29
|
|
Funds flow from
operations
|
0.33
|
0.35
|
1.27
|
1.35
|
Capital Management Measures
Funds Flow from Operations
Funds flow from operations is a non-GAAP capital management
measure that includes all cash generated from operating activities
and is calculated before changes in non-cash working capital. The
most comparable GAAP measure to funds flow from operations is cash
flows from operating activities. Management considers funds flow
from operations important as it helps evaluate financial
performance and demonstrates the Company's ability to generate
sufficient cash to fund future growth opportunities. Funds flow
from operations should not be considered an alternative to, or more
meaningful than, cash flows from operating activities however
management finds that the impact of working capital items on the
cash flows reduces the comparability of the metric from period to
period. A reconciliation of funds flow from operations to cash
flows from operating activities is as follows:
|
Three Months
Ended
December
31,
|
Year
Ended
December
31,
|
|
2023
|
2022
|
2023
|
2022
|
|
Cash flows from
operating activities
|
7,904
|
12,366
|
47,702
|
47,534
|
|
Add back changes in
non-cash working capital
|
4,489
|
827
|
328
|
2,345
|
|
Funds flow from
operations
|
12,393
|
13,193
|
48,030
|
49,879
|
Net Working Capital
Net working capital is computed as current assets less current
liabilities. Net working capital is a measure of liquidity, is used
to evaluate financial resources, and is calculated as
follows:
|
|
As at December
31
|
|
|
2023
|
2022
|
|
Total current
assets
|
|
25,995
|
27,627
|
|
Total current
liabilities
|
|
(12,878)
|
(12,929)
|
|
Net working
capital
|
|
13,117
|
14,698
|
Supplementary Financial Measures
"Average realized natural gas price - $/Mcf" is comprised
of natural gas sales as determined in accordance with IFRS, divided
by the Company's natural gas sales volumes.
"Average realized NGL – condensate price - $/bbl" is
comprised of condensate sales as determined in accordance with
IFRS, divided by the Company's NGL sales volumes from
condensate.
"Average realized oil price - $/bbl" is comprised of oil
sales as determined in accordance with IFRS, divided by the
Company's oil sales volumes.
"Average realized price - $/boe" is comprised of natural
gas, condensate and oil sales as determined in accordance with
IFRS, divided by the Company's total natural gas, NGL and oil sales
volumes (barrels of oil equivalent).
"Dividends per share" is comprised of dividends declared,
as determined in accordance with IFRS, divided by the number of
shares outstanding at the dividend record date.
"Royalties per boe" is comprised of royalties, as
determined in accordance with IFRS, divided by the total natural
gas, NGL and oil sales volumes (barrels of oil equivalent).
"Production expenses per boe" is comprised of production
expenses, as determined in accordance with IFRS, divided by the
total natural gas, NGL and oil sales volumes (barrels of oil
equivalent).
Oil and Natural Gas Advisories
Oil and Natural Gas Reserves
The disclosure in this news release summarizes certain
information contained in the GLJ Reserves and Resources Report but
represents only a portion of the disclosure required under National
Instrument 51-101 ("NI 51-101"). Full disclosure with respect to
the Company's reserves as at December 31,
2023 is included in the Company's AIF for the year ended
December 31, 2023 which has been
filed on SEDAR+ (www.sedarplus.ca). The GLJ Reserves and Resources
Report incorporates Alvopetro's working interest share of remaining
recoverable reserves and resources. With respect to the
Caburé natural gas field, Alvopetro's working interest was 49.1% as
of December 31, 2023 but is subject
to redeterminations, the first of which is currently underway. The
outcome of this redetermination is unknown and the resulting impact
on the reserves and the net presented value of future net revenue
attributable to such reserves as presented herein may be
material.
All net present values in this press release are based on
estimates of future operating and capital costs and GLJ's forecast
prices as of December 31, 2023. The
reserves definitions used in this evaluation are the standards
defined by the Canadian Oil and Gas Evaluation Handbook reserve
definitions and are consistent with NI 51-101 and used by GLJ. The
net present values of future net revenue attributable to the
Alvopetro's reserves estimated by GLJ do not represent the fair
market value of those reserves. Other assumptions and
qualifications relating to costs, prices for future production and
other matters are summarized herein. The recovery and reserve
estimates of the Company's reserves provided herein are estimates
only and there is no guarantee that the estimated reserves will be
recovered. Actual reserves may be greater than or less than the
estimates provided herein. Possible reserves are those additional
reserves that are less certain to be recovered than probable
reserves. There is a 10% probability that the quantities actually
recovered will equal or exceed the sum of proved plus probable plus
possible reserves.
Contingent Resources
This news release discloses estimates of Alvopetro's contingent
resources and the net present value associated with net revenues
associated with the production of such contingent resources as
included in the GLJ Reserves and Resources Report. There is no
certainty that it will be commercially viable to produce any
portion of such contingent resources and the estimated future net
revenues do not necessarily represent the fair market value of such
contingent resources. Estimates of contingent resources involve
additional risks over estimates of reserves. Full disclosure with
respect to the Company's contingent resources as at December 31, 2023 is contained in the Company's
annual information form for the year ended December 31, 2023 which has been filed on SEDAR+
(www.sedarplus.ca).
Prospective Resources
This news release discloses estimates of Alvopetro's prospective
resources included in the GLJ Reserves and Resources Report. There
is no certainty that any portion of the prospective resources will
be discovered and even if discovered, there is no certainty that it
will be commercially viable to produce any portion. Estimates
of prospective resources involve additional risks over estimates of
reserves. The accuracy of any resources estimate is a function of
the quality and quantity of available data and of engineering
interpretation and judgment. While resources presented herein are
considered reasonable, the estimates should be accepted with the
understanding that reservoir performance subsequent to the date of
the estimate may justify revision, either upward or downward. Full
disclosure with respect to the Company's prospective resources as
at December 31, 2023 will be
contained in the Company's annual information form for the year
ended December 31, 2023 which has
been filed on SEDAR+ (www.sedarplus.ca).
BOE Disclosure
The term barrels of oil equivalent ("boe") may be misleading,
particularly if used in isolation. A boe conversion ratio of six
thousand cubic feet per barrel (6 Mcf/bbl) of natural gas to
barrels of oil equivalence is based on an energy equivalency
conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead. All boe
conversions in this news release are derived from converting gas to
oil in the ratio mix of six thousand cubic feet of gas to one
barrel of oil.
Forward-Looking Statements and Cautionary Language
This news release contains forward-looking information within
the meaning of applicable securities laws. The use of any of the
words "will", "expect", "intend" and other similar words or
expressions are intended to identify forward-looking information.
Forward‐looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A
number of factors could cause actual results to vary significantly
from the expectations discussed in the forward-looking statements.
These forward-looking statements reflect current assumptions and
expectations regarding future events. Accordingly, when relying on
forward-looking statements to make decisions, Alvopetro cautions
readers not to place undue reliance on these statements, as
forward-looking statements involve significant risks and
uncertainties. More particularly and without limitation, this news
release contains forward-looking statements concerning the
redetermination and Alvopetro's working interest share of the
unitized area and the potential impact of the redetermination on
Alvopetro, the expected natural gas price, gas sales and gas
deliveries under Alvopetro's long-term gas sales
agreement, the timing and taxation of dividends and plans for
dividends in the future, plans relating to the Company's
operational activities, proposed exploration development activities
and the timing for such activities, exploration and development
prospects of Alvopetro, capital spending levels, future capital and
operating costs, future production and sales volumes, production
allocations from the Caburé natural gas field, anticipated
timing for upcoming drilling and testing of other wells, projected
financial results, the expected timing and outcomes of certain of
Alvopetro's testing activities, and sources and availability of
capital. Forward-looking statements are necessarily based upon
assumptions and judgments with respect to the future including, but
not limited to, expectations and assumptions concerning the timing
of regulatory licenses and approvals, equipment availability, the
success of future drilling, completion, testing, recompletion and
development activities and the timing of such activities, the
performance of producing wells and reservoirs, well development and
operating performance, expectations regarding Alvopetro's working
interest and the outcome of any redeterminations, environmental
regulation, including regulation relating to hydraulic fracturing
and stimulation, the ability to monetize hydrocarbons discovered,
the outlook for commodity markets and ability to access capital
markets, foreign exchange rates, general economic and business
conditions, forecasted demand for oil and natural gas, the impact
of global pandemics, weather and access to drilling locations, the
availability and cost of labour and services, the regulatory and
legal environment and other risks associated with oil and gas
operations. The reader is cautioned that assumptions used in
the preparation of such information, although considered reasonable
at the time of preparation, may prove to be incorrect. Actual
results achieved during the forecast period will vary from the
information provided herein as a result of numerous known and
unknown risks and uncertainties and other factors. In addition, the
declaration, timing, amount and payment of future dividends remain
at the discretion of the Board of Directors. Although we believe
that the expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be
placed on the forward-looking statements because we can give no
assurance that they will prove to be correct. Since forward looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, risks associated with the oil and gas industry in
general (e.g., operational risks in development, exploration and
production; delays or changes in plans with respect to exploration
or development projects or capital expenditures; the uncertainty of
reserve estimates; the uncertainty of estimates and projections
relating to production, costs and expenses, reliance on industry
partners, availability of equipment and personnel, uncertainty
surrounding timing for drilling and completion activities resulting
from weather and other factors, changes in applicable regulatory
regimes and health, safety and environmental risks), commodity
price and foreign exchange rate fluctuations, market uncertainty
associated with financial institution instability, and general
economic conditions. The reader is cautioned that assumptions used
in the preparation of such information, although considered
reasonable at the time of preparation, may prove to be incorrect.
Although Alvopetro 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 Alvopetro can give no assurance that it will
prove to be correct. Readers are cautioned that the foregoing list
of factors is not exhaustive. Additional information on factors
that could affect the operations or financial results of Alvopetro
are included in our AIF which may be accessed on Alvopetro's SEDAR+
profile at www.sedarplus.ca. The forward-looking information
contained in this news release is made as of the date hereof and
Alvopetro undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, unless so required by
applicable securities laws.
SOURCE Alvopetro Energy Ltd.