CALGARY, Alberta, Aug. 16, 2018 (GLOBE NEWSWIRE) — Strategic Oil & Gas Ltd. (“Strategic” or the “Company”) (TSXV: SOG) is pleased to report financial and operating results for the three and six months ended June 30, 2018. Detailed results and additional information are presented in Strategic’s interim condensed consolidated financial statements and related Management’s Discussion and Analysis (“MD&A”) which will be available through the Company’s website at www.sogoil.com and on SEDAR at www.sedar.com.
FINANCIAL AND OPERATIONAL SUMMARY | ||||||||||||
Three months ended June 30 |
Six months ended June 30 |
|||||||||||
Financial ($thousands, except per share amounts) | 2018 | 2017 | % change | 2018 | 2017 | % change | ||||||
Oil and natural gas sales | 10,639 | 10,312 | 3 | 20,720 | 19,200 | 8 | ||||||
Funds from operations (1) | 47 | 2,991 | (98) | 1,601 | 5,374 | (70) | ||||||
Per share basic (1) (2) | 0.00 | 0.06 | (100) | 0.03 | 0.12 | (75) | ||||||
Cash provided by operating activities | 972 | 1,828 | (47) | 1,742 | 1,879 | (7) | ||||||
Per share basic (2) | 0.02 | 0.04 | (50) | 0.04 | 0.04 | – | ||||||
Net loss | (6,399) | (7,020) | (9) | (11,562) | (11,460) | 1 | ||||||
Per share basic (2) | (0.14) | (0.15) | (7) | (0.25) | (0.25) | – | ||||||
Net capital expenditures | 940 | 12,784 | (93) | 10,101 | 30,851 | (67) | ||||||
Working capital (deficiency) (comparative figure is as of December 31, 2017) | (1,991) | 13,087 | – | (1,991) | 13,087 | – | ||||||
Net debt (comparative figure is as of December 31, 2017) (1) | 112,046 | 95,801 | 17 | 112,046 | 95,801 | 17 | ||||||
Operating | ||||||||||||
Average daily production | ||||||||||||
Crude oil (bbl per day) | 1,660 | 1,942 | (15) | 1,680 | 1,786 | (6) | ||||||
Natural gas (mcf per day) | 2,865 | 4,317 | (34) | 2,883 | 4,096 | (30) | ||||||
Barrels of oil equivalent (boe per day) | 2,138 | 2,661 | (20) | 2,161 | 2,468 | (12) | ||||||
Average prices | ||||||||||||
Oil & NGL, before risk management ($ per bbl) | 68.17 | 51.69 | 32 | 65.17 | 52.68 | 24 | ||||||
Oil & NGL, including risk management ($ per bbl) | 67.88 | 51.69 | 31 | 65.04 | 52.68 | 23 | ||||||
Natural gas ($ per mcf) | 1.30 | 3.00 | (57) | 1.73 | 2.93 | (41) | ||||||
Operating netback ($ per boe) (1) | ||||||||||||
Oil and natural gas sales | 54.68 | 42.58 | 28 | 52.99 | 42.97 | 23 | ||||||
Royalties | (10.20) | (4.61) | 121 | (8.90) | (5.03) | 77 | ||||||
Operating expenses | (25.11) | (19.05) | 32 | (25.53) | (18.83) | 36 | ||||||
Transportation expenses | (0.57) | (0.94) | (39) | (0.61) | (1.17) | (48) | ||||||
Operating Netback (1) | 18.80 | 17.98 | 5 | 17.95 | 17.94 | – | ||||||
Common Shares (2) (thousands) | ||||||||||||
Common shares outstanding, end of period | 46,421 | 46,388 | – | 46,421 | 46,388 | – | ||||||
Weighted average common shares (basic & diluted) | 46,405 | 46,384 | – | 46,401 | 45,969 | 1 | ||||||
(1) Funds from operations, net debt and operating netback are Non-GAAP measures; see “Non-GAAP measures” in the MD&A. | ||||||||||||
(2) Adjusted for the share consolidation on a 20:1 basis on March 6, 2017. | ||||||||||||
PERFORMANCE OVERVIEW AND OUTLOOK
In the second quarter, Strategic’s new management team was focused on the evaluation of the Company’s asset base and formulation of a development capital expenditure plan intended to debottleneck the West Marlowe field to optimize production and reserves on existing and future drill locations. In addition, a detailed technical evaluation of the Muskeg zone was developed to obtain “first principle” technical data associated with the Muskeg reservoir to better quantify the deliverability of the play. In the near term it is Management’s intention to identify and evaluate funding alternatives for its capital expenditure plan, and the Company will provide additional information as it becomes available.
With respect to the two well Muskeg drilling program completed in the first quarter of 2018, despite the negative impact of pipeline pressures and surface restrictions, the new wells are producing steadily with 98% runtime for the second quarter. Average rates over the first 60 and 90 days of production are as follows:
IP60 | IP90 | |||
Well | Total (boe/d) | % oil | Total (boe/d) | % oil |
1-2 | 216 | 84% | 182 | 82% |
5-1 | 173 | 86% | 156 | 84% |
QUARTERLY SUMMARY
About Strategic
Strategic is a junior oil and gas company committed to becoming a premier northern oil and gas operator by exploiting its light oil assets primarily in northern Alberta. The Company maintains control over its resource base through high working interest ownership in wells, construction and operation of its own processing facilities and a significant undeveloped land and opportunity base. Strategic’s primary operating area is at Marlowe, Alberta. Strategic’s common shares trade on the TSX Venture Exchange under the symbol SOG.
For more information, please contact:
Tony Berthelet President & Chief Executive Officer |
|
Aaron Thompson Chief Financial Officer |
|
Strategic Oil & Gas Ltd. 1100, 645 7th Avenue SW Calgary, AB T2P 4G8 Telephone: 403.767.9000 Fax: 403.767.9122 |