CALGARY, ALBERTA–(Marketwired – April 26, 2016) – 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, 2015. Our full audited Consolidated Financial Statements and Notes, as well as Management’s Discussion and Analysis (“MD&A”) and Annual Information Form (“AIF”) for the year ended December 31, 2015 are available on Striker’s website (www.strikerexp.com) and will be filed on SEDAR.
FINANCIAL AND OPERATING HIGHLIGHTS
|for the three months ended||for the year ended|
|December 31,||December 31,|
|(in thousands of dollars except where noted)|
|Oil and Gas Sales|
|Oil and NGLs||$6,983||$4,817||45%||$31,366||$6,795||362%|
|Per share – basic & fully diluted (in dollars)(2)||$0.06||($0.03)||nm||$0.44||($0.22)||nm|
|Corporate acquisitions||$ –||$60,506||–||$ –||$60,506||–|
|Property acquisitions / (dispositions)||($5,183)||$30,045||nm||$7,914||$30,045||-74%|
|Net Debt and Working Capital Deficit(1)||$8,230||$7,695||7%||$8,230||$7,695||7%|
|Weighted Average Shares(2)|
|Basic & Fully diluted||32,236||19,677||64%||29,022||8,531||240%|
|Production (6:1 boe conversion)(3)|
|Oil and NGLs (bbls/d)||1,728||914||89%||1,736||295||488%|
|Natural gas (mcf/d)||6,304||3,263||93%||6,187||1,237||400%|
|Netbacks (in dollars /boe) (1) (3)|
|Production and royalty revenue||$33.35||$43.89||-24%||$37.53||$47.12||-20%|
|Realized gain (loss) on financial instruments||$0.74||$3.22||-77%||($0.03)||$2.36||nm|
|Operating & transportation costs (4)||($17.40)||($13.85)||-26%||($14.01)||($16.70)||16%|
|(1) See Non-IFRS measures.|
|(2) Excluded from the weighted average and Funds flow per share calculation is the effect of the options and warrants, as their effect is anti-dilutive under IFRS.|
|(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.|
|(4) Recorded one-time adjustments for gas compression and other fees relating to Q1-Q3, 2015, and prior years. The effect of these items resulted in additional operating costs of $4.50 per Boe in Q4 2015 and $0.37 per Boe for the twelve months ended December 31, 2015.|
- Drilled 6.0 gross (2.9 net) wells in the Wilson Creek area for $2.5 million. Of these drills, 5.0 gross (1.9 net) wells were completed while 3.0 gross (1.7 net) were equipped for $0.8 million. The equipped wells were brought on production during the quarter;
- Completed a $5.1 million disposition of non-strategic gross overriding royalties in the Killam area. These assets represented the majority of Striker’s gross overriding royalty holdings and consisted of production averaging 48 boe per day;
- Achieved production of 2,778 boe/d which represents a 91% increase from Q4 2014; and
- Recorded one-time adjustments for gas compression and other fees relating to Q1-Q3, 2015, and prior years. The effect of these items resulted in additional operating costs of $4.50 per boe in Q4 2015 and $0.37 per boe for the twelve months ended December 31, 2015.
During the year ended December 31, 2015, Striker achieved the following milestones:
- Maintained balance sheet strength with net debt of $8.2 million, representing debt to trailing annualized funds flow of 0.64x;
- Drilled 9.0 gross (5.9 net) wells targeting the Belly River formation in the Thorsby and Wilson Creek areas for $5.1 million. In total, completed 11.0 gross (7.9 net) wells and equipped/tied-in and brought on production 8.0 gross (6.5 net) wells respectively, for $3.2 million;
- Acquired 320 boe/d (65% liquids) and 98 net sections of undeveloped land through various acquisitions, predominantly in the Wilson Creek area, for $13.5 million. The acquisitions were partially funded through a private equity offering of $8.0 million or 5.4 million common shares at a price of $1.48 per share;
- Disposed of various non-core assets for proceeds of approximately $5.6 million. The assets consisted of an estimated 100 boe/d and $3.0 million of decommissioning obligations;
- Achieved production of 2,767 boe/d which represents a 4% increase over 2015 guidance; and
- Consolidated outstanding shares on a 20:1 basis and changed the name of the Company to Striker Exploration Corp. from Elkwater Resources Ltd.
2015 SUBSEQUENT EVENTS
As previously announced in the March 14, 2016 press release, the Company’s Board of Directors has determined that it is timely, prudent and in the best interests of shareholders to initiate a formal process to explore strategic alternatives with a view to enhancing shareholder value. Such strategic alternatives may include, but are not limited to, a corporate sale, merger or other business combination, the sale of all or a material portion of Striker’s assets, a reorganization, recapitalization or restructuring of Striker or any combination of the foregoing. FirstEnergy Capital Corp. has been retained by Striker to act as its exclusive financial advisor in connection with this comprehensive review and analysis of strategic alternatives.
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”.