REGINA, SK – ROK Resources Inc. (“ROK” or the “Company“) (TSXV:ROK) has filed its interim Financial Results and Management Discussion & Analysis for the three and nine months ended
September 30, 2022.
Financial and Operating Highlights
In Q3 2022, the Company realized production volume of 321,989 total boe (3,500 boe/d), resulting in crude and natural gas sales of $26.6 million and funds from operations of $14.5 million. This equates to an operating netback, after hedging, per boe of $43.10 and an operating income profit margin of 52.3%.
Financial | Q3 2022 | Q3 2021 | YTD 2022 | YTD 2021 | ||||||||||||
Net income (loss) | 10,810,729 | (919,222 | ) | 84,573,899 | (1,677,438 | ) | ||||||||||
Basic ($/share) | 0.05 | (0.01 | ) | 0.51 | (0.03 | ) | ||||||||||
Diluted ($/share) | 0.05 | (0.01 | ) | 0.50 | (0.03 | ) | ||||||||||
Funds flow | 11,581,159 | (44,430 | ) | 31,161,162 | (359,466 | ) | ||||||||||
Basic ($/share) | 0.06 | (0.00 | ) | 0.19 | (0.01 | ) | ||||||||||
Diluted ($/share) | 0.05 | (0.00 | ) | 0.18 | (0.01 | ) | ||||||||||
Expenditures on property, plant and equipment | 11,938,870 | 1,535,102 | 16,441,696 | 1,650,334 | ||||||||||||
Operating | ||||||||||||||||
Operating Income | ||||||||||||||||
Oil and Natural Gas Sales | 26,554,511 | 1,075,829 | 63,386,401 | 2,225,065 | ||||||||||||
Royalties | (4,303,644 | ) | (205,357 | ) | (10,185,960 | ) | (425,826 | ) | ||||||||
Operating Expenses | (9,926,624 | ) | (473,924 | ) | (17,551,783 | ) | (954,577 | ) | ||||||||
Operating Income | 12,324,243 | 396,548 | 35,648,658 | 844,662 | ||||||||||||
Realized gain on commodity contracts | 1,552,524 | – | 1,788,499 | – | ||||||||||||
Processing and other income | 627,612 | – | 1,212,622 | – | ||||||||||||
Funds from operations | 14,504,379 | 396,548 | 38,649,779 | 844,662 | ||||||||||||
Average daily production | ||||||||||||||||
Crude oil (bbl/d) | 2,170 | 130 | 1,644 | 98 | ||||||||||||
NGLs (boe/d) | 240 | 36 | 163 | 38 | ||||||||||||
Natural gas (mcf/d) | 6,535 | 179 | 4,206 | 215 | ||||||||||||
Total (boe/d) | 3,500 | 197 | 2,507 | 171 | ||||||||||||
Operating Netback per boe | ||||||||||||||||
Oil and Natural Gas Sales | 82.47 | 59.42 | 92.60 | 47.65 | ||||||||||||
Royalties | (13.37 | ) | (11.34 | ) | (14.88 | ) | (9.12 | ) | ||||||||
Operating Expenses | (30.83 | ) | (26.17 | ) | (25.64 | ) | (20.44 | ) | ||||||||
Operating Netbacks ($/boe) | 38.27 | 21.91 | 52.08 | 18.09 | ||||||||||||
Operating Netbacks, after hedging ($/boe) | 43.10 | 21.91 | 54.69 | 18.09 | ||||||||||||
Operating Income Profit Margin | 46.4 | % | 36.9 | % | 56.2 | % | 38.0 | % | ||||||||
Operating Income Profit Margin, after hedging | 52.3 | % | 36.9 | % | 59.1 | % | 38.0 | % | ||||||||
Share information | ||||||||||||||||
Common shares outstanding, end of period | 201,247,706 | 74,471,576 | 201,247,706 | 74,471,576 | ||||||||||||
Weighted average basic shares outstanding | 199,711,392 | 74,471,576 | 164,762,938 | 66,142,730 | ||||||||||||
Weighted average diluted shares outstanding | 222,398,843 | 74,471,576 | 170,622,352 | 66,142,730 |
Net Debt
The continued reduction of Net Debt quarter over quarter is a result of organically generated funds flows utilized to reduce Company indebtedness. ROK uses “Net Debt” as a measure of the Company’s financial position and liquidity, however it is not intended to be viewed as an alternative to other measures calculated in accordance with IFRS.
September 30, 2022 |
June 30, 2022 |
March 31, 2022 |
December 31, 2021 |
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Senior Loan Facility (14.25%) | 52,191,179 | 58,298,629 | 62,549,849 | – | ||||||||||||
Debt Notes (14%) | – | – | – | 4,000,000 | ||||||||||||
Less: adjusted working capital | 21,516,524 | 19,912,783 | 16,750,311 | 478,610 | ||||||||||||
Net debt | 30,674,655 | 38,385,846 | 45,799,538 | 3,521,390 |
Third Quarter Highlights:
- Record production of 3,500 boe/d (69% liquids), an increase of 14.6% compared to Q2 2022
- Reduction of Net Debt to $30.7 million, a 20% reduction from Q2 2022
- Drilled the best producing well in Saskatchewan during the month of July with average production rate over the first 30 days of production of approximately 300 boe/d
- Conducted Phase 1 of a reactivation/workover program at Kaybob, resulting in capital efficiencies of $7,000
to $10,000 per boe and the identification of 9 gross (9 net) additional operations planned for Q4 2022
/ Q1 2023 - Realized hedge gain on commodity contracts of $1,552,524
Complete reports and statements are available on SEDAR at www.sedar.com