CALGARY, Nov. 10, 2016 /CNW/ – Questerre Energy Corporation (“Questerre” or the “Company”) (TSX,OSE:QEC) reported today on its financial and operating results for the quarter ended September 30, 2016.
Michael Binnion, President and Chief Executive Officer, commented, “We made measurable progress on all our assets this quarter. At Kakwa, enhanced well completions are delivering promising results. The average production over the first 90 days for 2016 wells, including those we did not participate in, is approximately 25% higher than the 90 day average for 2015 wells. We are investing in additional infrastructure to reduce costs and improve returns on future wells. We also strengthened our financial liquidity, raising approximately $12 million through two equity placements in July and early November.”
- Quebec Government approves new hydrocarbon legislation in principle
- Finalized resource assessment for Jordan oil shale acreage
- Completed equity placement for gross proceeds of $4.75 million
- Average daily production of 1,275 boe/d with cash flow from operations of $1.45 million for the quarter
He added, “The new hydrocarbon legislation introduced in June was approved in principle by the Quebec government. This is another important milestone. The law is now being studied in detail and we expect it will be approved before year-end. It will lay the groundwork for the new regulations that we should see next spring.”
Commenting on the Company’s oil shale assets in Jordan he further noted, “We finalized an independent resource assessment of our oil shale acreage in Jordan. It indicates a significant resource of discovered petroleum initially in place. Although this project is still in its infancy, it validates the investment we have made over the last two years.”
The Company reported daily production that averaged 1,275 boe/d in the third quarter of 2016 (2015: 1,934 boe/d) with Kakwa accounting for nearly 75% of these volumes (2015: 80%). In 2016, only one (0.25 net) new well on its joint venture acreage at Kakwa was brought on production in the quarter compared to four (1.0 net) new wells in third quarter of 2016. On a year to date basis, production declined by under 10% to 1,411 boe/d in 2016 from 1,559 boe/d last year.
Lower production volumes and commodity prices in 2016 resulted in cash flow from operations of $1.45 million for the quarter (2015: $3.18 million). The Company reported a net loss of $1.01 million for the third quarter of 2016 (2015: $18.17 million loss) and a net loss of $3.51 million for the nine months ended September 30, 2016 (2015: $17.49 million).
Consistent with prior periods, for the nine months ended September 30, 2016, Questerre invested $8.96 million in its assets (2015: $19.51 million) with over 80% in Kakwa (2015: 90%) and 10% in Jordan (2015: $2%). The Company intends to invest up to an additional $3 million over the remainder of this year.
The term “cash flow from operations” is a non-IFRS measure. Please see the reconciliation elsewhere in this press release.
Questerre Energy Corporation is leveraging its expertise gained through early exposure to shale and other non-conventional reservoirs. The Company has base production and reserves in the tight oil Bakken/Torquay of southeast Saskatchewan. It is bringing on production from its lands in the heart of the high-liquids Montney shale fairway. It is a leader on social license to operate issues for its Utica shale gas discovery in the St. Lawrence Lowlands, Quebec. It is pursuing oil shale projects with the aim of commercially developing these massive resources.
Questerre is a believer that the future success of the oil and gas industry depends on a balance of economics, environment and society. We are committed to being transparent and are respectful that the public must be part of making the important choices for our energy future.