CALGARY, ALBERTA–(Marketwired – April 29, 2015) – Striker Exploration Corp. (“Striker” or the “Company”) (TSX VENTURE:SKX) is pleased to announce our operating and financial results for the three and twelve month periods ended December 31, 2014. Our full audited Consolidated Financial Statements and Notes, as well as Management’s Discussion and Analysis (“MD&A”) for the year ended December 31, 2014 are available on Striker’s website (www.strikerexp.com) and will be filed on SEDAR.
|FINANCIAL AND OPERATING HIGHLIGHTS|
|Three Months Ended||Year ended|
|December 31,||December 31,|
|(in thousands of dollars except where noted)|
|Oil and Gas Sales|
|Oil and NGLs||$||4,817||$||529||810||%||$||6,795||$||2,098||224||%|
|Per share – basic (in dollars)(2)||$||(0.04||)||$||0.52||-108||%||$||(0.23||)||$||0.66||-134||%|
|Per share – fully diluted (in dollars)(2)||$||(0.04||)||$||0.52||-107||%||$||(0.23||)||$||0.66||-129||%|
|Net Debt and Working Capital Deficit(1)||$||7,695||$||4,147||86||%||$||7,695||$||4,147||86||%|
|Weighted Average Shares(2)|
|Production (6:1 boe conversion)(3)|
|Oil and NGLs (bbls/d)||914||91||904||%||295||81||264||%|
|Natural gas (mcf/d)||3,263||428||662||%||1,237||444||179||%|
|Netbacks (in dollars /boe) (1) (3)|
|Production and royalty sales||$||43.89||$||44.65||-2||%||$||47.12||$||45.69||3||%|
|Realized gain on financial instruments||$||3.22||$||0.00||–||$||2.36||$||0.00||–|
|(1)||See “Reader Advisories – Non-IFRS Measures”.|
|(2)||Shown post stock consolidation of 20:1 effective March 2, 2015.Excluded from the diluted loss per share calculation is the effect of 8,997,500 warrants as their effect is anti-dilutive.|
|(3)||Boe conversion ratio for natural gas of 1 Boe: 6 Mcf has been used, which is based on an energy equivalency conversion method primarily applicable at the burner tip and does not necessarily represent a value equivalency at the wellhead. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.|
During the year ended December 31, 2014 and through late April 2015, Striker achieved the following milestones:
- On July 10, 2014, completed reorganization and investment transaction which recapitalized Elkwater Resources Ltd. (later renamed “Striker Exploration Corp.”). The reorganization and investment transaction included a non-brokered private placement of $25.0 million, the appointment of a new management team and board of directors, and a rights offering to then current holders of common shares of Elkwater;
- On October 29, 2014, closed a bought deal, subscription receipt financing of $90.0 million;
- On November 13, 2014, closed a CEE flow-through financing of $5.0 million and a CDE flow-through financing of $5.0 million;
- On November 20, 2014, completed two strategic acquisitions for consideration including cash and assumption of debt of approximately $113.8 million securing assets in the East Pembina, Chigwell, and Killam areas of Alberta. The acquisitions added approximately 2,475 boe/d (approximately 60% oil and natural gas liquids) of operated production in Alberta;
- Secured a new credit facility with a syndicate of Canadian chartered banks. The new facility consists of a $40.0 million revolving term facility, plus a $15.0 million revolving operating facility both facilities are to be reviewed by the lending syndicate on or before May 31, 2015;
- Invested approximately $7.0 million in Q4 2014 in drilling and development activities, targeting light oil from the Cardium and Belly River zones at Drayton Valley, and medium oil from the Lloydminster zone at Killam;
- Achieved year-end 2014 Proved Developed Producing (“PDP”) reserves of 4,547 Mboe (56% oil and liquids) a 4,198 Mboe increase from the 349 Mboe at year-end 2013, and increased total proved (“1P”) reserves to 6,398 Mboe from 538 Mboe in 2013; and
- Maintained a strong balance sheet with year-end 2014 net debt of $7.7 million.
2014 SUBSEQUENT EVENTS
- During February 2015, closed a Belly River transaction for $1.75 million in the East Pembina and Chigwell core areas. The transaction included 25 gross/23 net sections of undeveloped land, 45 boepd of production (65% light oil), and over 50 square miles of 3D and 93 miles of 2D seismic;
- On March 2, 2015, commenced trading its common shares on the TSXV under the name “Striker Exploration Corp.” after completing a 20 to 1 share consolidation. Striker presently has 26,830,236 common shares issued and outstanding;
- On March 19, 2015, announced consolidated year end reserves including the two strategic acquisitions from 2014, in addition to drilling and operational results from wells in Drayton Valley targeting the Cardium formation, Brazeau targeting the Belly River formation and updated production performance from a Belly River well in Chigwell; and
- Appointed Kevan Newman, P.Eng as Vice President, Production effective April 28, 2015. Pursuant to the terms and conditions of Striker’s incentive stock option plan and in connection with his appointment, Striker has granted 140,000 options to Kevan Newman at an exercise price of $2.40, which vest over three years (1/3 on each of the first, second and third anniversary of the grant date).
Striker is a growth-oriented, light oil focused company operating predominantly in Alberta. Striker’s full-cycle business plan provides an excellent opportunity to position itself as a high-growth junior E&P company. With an experienced management team and a strong committed Board, growth is expected to occur through timely strategic acquisitions and drilling. Striker currently trades on the TSX Venture Exchange under ticker “SKX”.
FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements. More particularly, this press release contains statements concerning the Company’s growth strategy, the Company’s drilling plans and timing thereof, the change of name of the Company to “Striker Exploration Corp.” and the consolidation of the outstanding common shares of the Company. In addition, the use of any of the words “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “propose”, “project”, “can”, “will”, “should”, “continue”, “may”, and similar expressions are intended to identify forward-looking statements. The forward-looking statements contained herein are based on certain key expectations and assumptions made by the Company, including but not limited to expectations and assumptions concerning the availability of capital, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of existing wells, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes 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 the Company 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; as the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the Company’s most recent Annual Information Form dated April 28, 2015 for the year ended December 31, 2014, on SEDAR at www.sedar.com, and the risk factors contained therein.
The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
NON-IFRS MEASURES: This press release contains the terms “funds flow from operations” and “net debt”, which do not have a standardized meaning prescribed by IFRS and therefore may not be comparable with the calculation of similar measures by other companies. Management uses funds flow from operations to analyze operating performance and leverage. Management believes “net debt” is a useful supplemental measure of the total amount of current and long-term debt of the Company. Mark-to-market risk management contracts are excluded from the net debt calculation. Additional information relating to these non-IFRS measures, including the reconciliation between funds flow from operations and cash flow from operating activities, can be found in the Company’s most recent management’s discussion and analysis MD&A, which may be accessed through the SEDAR website (www.sedar.com).
ADVISORY ON PRODUCTION INFORMATION: Unless otherwise indicated herein, all production information presented herein has presented on a gross basis, which is the Company’s working interest prior to deduction of royalties and without including any royalty interests.
BARRELS OF OIL EQUIVALENT: The term “boe” or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (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. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
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.
Striker Exploration Corp.
President and Chief Executive Officer
Striker Exploration Corp.
Vice President, Finance and Chief Financial Officer
Striker Exploration Corp.
1250, 645 – 7th Avenue S.W
Calgary, Alberta T2P 4G8