CALGARY, ALBERTA–(Marketwired – Aug. 27, 2015) – Striker Exploration Corp. (“Striker” or the “Company”) (TSX VENTURE:SKX) is pleased to announce our operating and financial results for the three and six month periods ended June 30, 2015. Our Interim Condensed Financial Statements and Notes, as well as Management’s Discussion and Analysis (“MD&A”) for the three and six month periods ended June 30, 2015, are available on Striker’s website (www.strikerexp.com) and will be filed on SEDAR.
SECOND QUARTER 2015 HIGHLIGHTS
The second quarter of 2015 saw continued efforts to work on expanding itself as a focused light oil growth exploration and production entity. Attention was given to expanding the Company’s light oil prospects and enhancing its positions in its operated core areas. The following highlights were achieved during the three months ended June 30, 2015 (Q2):
FINANCIAL AND OPERATING HIGHLIGHTS
| for the 3 months Ended June 30, 2015 |
for the 6 months Ended June 30, 2015 |
||||
| (in thousands of dollars except where noted) | |||||
| Oil and Gas Sales | |||||
| Oil and NGLs | $8,285 | $16,607 | |||
| Natural gas | $1,434 | $3,123 | |||
| Total | $9,719 | $19,730 | |||
| Funds Flow | $3,567 | $7,232 | |||
| Per share – basic (in dollars) | $0.13 | $0.27 | |||
| Per share – fully diluted (in dollars) | $0.09 | $0.19 | |||
| Capital Expenditures | |||||
| Property acquisitions/dispositions | $3,967 | $6,812 | |||
| Production (6:1 boe conversion) | |||||
| Oil and NGLs (bbls/d) | 1,465 | 1,733 | |||
| Natural gas (mcf/d) | 5,511 | 5,939 | |||
| Total (boe/d) | 2,384 | 2,723 | |||
| Netbacks (in dollars/boe) | |||||
| Production and royalty sales | $44.81 | $40.03 | |||
| Royalties | ($6.77 | ) | ($6.58 | ) | |
| Operating costs | ($13.70 | ) | ($12.38 | ) | |
| Transportation costs | ($0.63 | ) | ($0.67 | ) | |
| Operating netback | $23.71 | $20.40 | |||
| General and administrative costs | ($5.48 | ) | ($4.60 | ) | |
| Finance expense (cash component) | ($0.60 | ) | ($0.62 | ) | |
| Corporate netback | $17.63 | $15.18 | |||
| (1) | See “Non-IFRS Measures” |
| (2) | BOE conversion for natural gas of 1Boe:6Mcf 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 price 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 |
| (3) | Excludes unrealized risk management contracts |
OUTLOOK
Second quarter production averaged 2,384 boe/d as compared to guidance of 2,300 boe/d. As in the second quarter, third quarter production continues to be affected by restrictions and facility maintenance on the Nova gas transmission system. The Company was able to secure firm service from a third party for the month of August allowing the previously curtailed production at Brazeau to come online. Concurrently, Striker is in the process of temporarily shutting in a number of wells on its minor properties representing approximately 120 boe/d, primarily natural gas. The result is an estimated third quarter average production to August 21, based on field receipts, of approximately 2,800 boe/d.
The third quarter Belly River horizontal light oil drilling program commenced in late July. At Thorsby, the Company drilled and cased its first 3.0 gross (3.0 net) horizontal exploratory wells. Completion operations are underway with production testing to follow. Both drilling and completion costs to date have been materially lower than anticipated. The remaining 3 gross (1.7 net) wells of the third quarter will be drilled at Wilson Creek and are expected to commence in early September. Striker anticipates releasing results from the third quarter drilling program during mid fourth quarter.
In spite of recent third-party pipeline outages, Striker is maintaining its full year average production guidance of 2,650 boe/d and will complete its third quarter planned drilling program.
ABOUT STRIKER
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”.
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READER ADVISORY
Forward-Looking Statements. Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “propose”, “project” or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to, future production levels, future development costs associated with oil and gas reserves, filing of the Company’s annual information form, future drilling locations and the Company’s intention to identify, capture and execute on additional opportunities. Statements relating to “reserves” are also deemed to be forward-looking statements, 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.
The forward-looking statements contained in this press release are based on certain key expectations and assumptions made by Striker, including expectations and assumptions concerning the success of future drilling, development and completion activities, the performance of existing wells, the performance of new wells, the availability and performance of facilities and pipelines, the geological characteristics of Striker’s properties, the successful application of drilling, completion and seismic technology, prevailing weather and break-up conditions, commodity prices, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the availability of capital, labour and services, the creditworthiness of industry partners and our ability to acquire additional assets.
Although Striker 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 Striker 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; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), constraint in the availability of services, commodity price and exchange rate fluctuations, adverse weather or break-up conditions and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. These and other risks are set out in more detail in Striker’s Annual Information Form for the year ended December 31, 2014.
The forward-looking information contained in this press release is made as of the date hereof and Striker undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward-looking information contained in this press release is expressly qualified by this cautionary statement.
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 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 the report are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil.
Non-IFRS Measures. This press release contains the term “net debt”, which does not have a standardized meaning prescribed by International Financial Reporting Standards (“IFRS”) and therefore may not be comparable with the calculation of similar measures by other companies. Management believes “net debt” is a useful supplemental measure of the total amount of current and long-term debt of the Company. Additional information relating to non-IFRS measures 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).
Production Rates. Any references in this press release to initial production rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will continue to produce and decline thereafter and are not necessarily indicative of long-term performance or ultimate recovery. Readers are cautioned not to place reliance on such rates in calculating the aggregate production for the Company. Such rates are based on field estimates and may be based on limited data available at this time.
Striker Exploration Corp.
Doug Bailey
President and Chief Executive Officer
(403) 262-0242
Striker Exploration Corp.
Neil Burrows
Vice President, Finance and Chief Financial Officer
(403) 262-0242
www.strikerexp.com
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