CALGARY, ALBERTA–(Marketwired – Jan. 14, 2016) – Yoho Resources Inc. (TSX VENTURE:YO) (“Yoho” or the “Company”) has filed today on SEDAR the financial statements for the year ended September 30, 2015 and the related managements’ discussion and analysis (“MD&A”). Copies of these documents may be found on www.sedar.com.
In December 2015, subsequent to its 2015 fiscal year end, Yoho closed a transaction to sell a portion of its Duvernay assets in the Kaybob area of Alberta for cash consideration of $50 million (prior to adjustments) (the “Transaction”). Yoho has retained approximately 25% of its net Kaybob Duvernay acreage consisting of 5.5 sections at 100% working interest and the Company’s recently completed Duvernay horizontal well at 16-12-59-19 W5.
- Yoho’s production during fiscal 2015 averaged 1,714 boe per day (34% oil and natural gas liquids (“NGL”)), compared to fiscal 2014 production of 1,712 boe per day (29% oil and NGL).
- Yoho generated funds from operations for fiscal 2015 of $4.6 million ($0.08 per share basic).
- Net exploration and development expenditures for fiscal 2015 were $31.6 million primarily for drilling and completions, including the drilling of 3 (1.0 net) wells.
- Due to the ongoing low price commodity environment, the Company has recorded an impairment of $77.1 million on its property, plant and equipment during fiscal 2015, resulting in a net loss of $62.6 million for fiscal 2015.
- Subsequent to the Transaction, Yoho’s proved plus probable reserves (Company interest) as evaluated by GLJ as at September 30, 2015 were 13.2 MMboe and the Company’s proved reserves (Company interest) as at September 30, 2015 were 5.9 MMboe.
|Petroleum and natural gas sales||16,529,720||26,234,952|
|Funds from operations (1)||4,581,133||11,135,762|
|per share – basic||0.08||0.22|
|per share – diluted||0.08||0.21|
|Net income (loss)||(62,563,607)||43,154,230|
|per share – basic||(1.13)||0.83|
|per share – diluted||(1.13)||0.82|
|Net exploration and development expenditures||34,539,821||31,721,969|
|Net acquisitions and dispositions||(2,969,455)||(30,194,887)|
|Total debt (including working capital deficiency)||27,977,846||16,225,061|
|Weighted average common shares outstanding|
|Natural gas (mcf/d)||6,762||7,292|
|Oil and NGL (bbls/d)||587||497|
|Realized sales prices|
|Natural gas ($/mcf)||2.56||4.47|
|Oil and NGL ($/bbl)||47.69||78.96|
|Funds from operations per boe ($/boe)|
|Petroleum and natural gas sales||26.42||41.97|
|Operating netback (2)||12.25||25.12|
|General and administrative||(3.25)||(4.74)|
|Realized gain (loss) on financial derivative contracts||0.07||(1.51)|
|Funds from operations (1)||7.31||17.82|
|Working interest wells||1.0||4.3|
|Undeveloped land (net acres)||69,232||89,755|
|(1) Funds from operations is calculated as cash provided by operating activities, adding the change in non-cash working capital and decommissioning obligation expenditures. Funds from operations is used to analyze the Company’s operating performance and leverage. Funds from operations does not have a standardized measure prescribed by IFRS and therefore may not be comparable with the calculations of similar measures for other companies. Yoho’s calculation of funds from operations is detailed in the MD&A for the years ended September 30, 2015 and 2014.|
|(2) Operating netback equals petroleum and natural gas sales less royalties, operating costs and transportation costs calculated on a boe basis. Operating netback does not have a standardized measure prescribed by IFRS and therefore may not be comparable with the calculations of similar measures for other companies.|
CORPORATE RESERVES POST TRANSACTION
The reserves data set forth below is based upon an independent reserve assessment and evaluation prepared by GLJ with an effective date of September 30, 2015 (the “GLJ Report”) and excludes the reserves related to the Duvernay assets sold in the Transaction. A full summary of the Company’s reserves as at September 30, 2015 (including those that were subject to the Transaction), will be included in the Company’s Annual Information Form for the year ended September 30, 2015, which will be available shortly on SEDAR at www.sedar.com. The following summarizes the Company’s crude oil, natural gas liquids and natural gas reserves and the net present values before income taxes of future net revenue for the Company’s reserves using forecast prices and costs based on the GLJ Report. The GLJ Report has been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and the reserve definitions contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”).
All evaluations and reviews of future net cash flows are stated prior to any provisions for interest costs or general and administrative costs and after the deduction of estimated future capital expenditures for wells to which reserves have been assigned. It should not be assumed that the estimates of future net revenues presented in the tables below represent the fair market value of the reserves. There is no assurance that the forecast prices and cost assumptions will be attained and variances from these assumptions could be material. The recovery and reserve estimates of the crude oil, natural gas liquids and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, natural gas and natural gas liquids reserves may be greater than or less than the estimates provided herein.
Reserves Summary Post -Transaction
The following table provides summary reserve information based upon the GLJ Report and using the published GLJ (October 1, 2015) price forecast, after giving effect to the Transaction.
|Light and Medium Oil||Heavy Oil||Natural Gas Liquids|
|Total proved & probable (4)||493||424||137||118||3,663||2,933|
|Total Natural Gas||Total Barrels of
Oil Equivalent (3)
|Total proved & probable (4)||53,425||49,513||13,197||11,727|
|(1) “Company Interest” reserves means Yoho’s working interest (operating and non-operating) share before deduction of royalties and including any royalty interest of the Company.|
|(2) “Net” reserves means Yoho’s working interest (operated and non-operated) share after deduction of royalty obligations, plus Yoho’s royalty interest in reserves.|
|(3) Barrels of oil equivalent, or BOE, amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. BOEs 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 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 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 mcf: 1 bbl, utilizing a conversion ratio of 6 mcf: 1 bbl may be a misleading indication of value.|
|(4) May not add due to rounding.|
Reserves Values Post-Transaction
The estimated before tax net present value of future net revenues, after giving effect to the Transaction, associated with Yoho’s reserves effective September 30, 2015 and based on the published GLJ (October 1, 2015) future price forecast are summarized in the following table:
|Total proved plus probable(3)||252,542||138,987||88,184||61,100||44,851|
|(1) The estimated future net revenues are reduced for estimated future abandonment and reclamation costs and estimated capital for future development associated with the reserves.|
|(2) The net present value of future revenues does not represent fair market value.|
|(3) May not add due to rounding.|
Future Development Costs Post Transaction
The following table sets forth development costs deducted in the estimation of the future net revenue attributable to the reserve categories noted above, after giving effect to the Transaction.
Forecast Prices and Costs
|Proved Reserves||Proved Plus
|Total Undiscounted (all years)||38,438||94,594|
|Total Discounted 10%||31,991||73,734|
The GLJ October 1, 2015 price forecast is summarized as follows:
|Calendar Year||2015 Q4||2016||2017||2018||2019||2020||2021||2022||2023||2024|
|Heavy crude (12°API) at Hardisty ($Cdn/bbl)||36.69||42.30||46.23||50.22||54.13||57.96||63.56||69.32||75.24||78.71|
|Alberta Plant Gate ($Cdn/mmbtu)||2.74||3.20||3.38||3.48||3.57||3.66||3.86||4.06||4.26||4.53|
|British Columbia Plant Gate ($Cdn/mmbtu)||1.99||2.84||3.23||3.33||3.42||3.51||3.71||3.91||4.10||4.38|
|(1) Inflation is accounted for at 2.0% per year|
Yoho’s current initial fiscal 2016 plan includes a capital program of $7 to $8 million with average production of 900 to 1,000 boe per day. Completion operations on Yoho’s 100% Duvernay well in Kaybob were finished during fiscal Q1 2016. Operations to equip and tie-in this well are expected to commence in fiscal Q3 2016 with initial production from this well expected in fiscal Q4 2016.
Yoho Resources Inc. is a Calgary based junior oil and natural gas company with operations focusing in West Central Alberta and northeast British Columbia. The common shares of Yoho are listed on the TSX Venture Exchange under the symbol “YO”.