CALGARY, ALBERTA -- (Marketwire) -- 03/22/13 -- Eagle Energy Trust (the "Trust") (TSX: EGL.UN) is pleased to report its financial and operating results for the three month period and year ended December 31, 2012. In addition, the Trust reports that it has filed its Annual Information Form ("AIF"), which includes the Trust's reserves data and other oil and gas information for the period ended December 31, 2012. The audited consolidated financial statements, management's discussion and analysis and AIF have been filed with the securities regulators and are available on the Trust's website at www.EagleEnergyTrust.com and will be available under the Trust's issuer profile on the SEDAR website at www.sedar.com.
This press release contains statements that are forward looking. Investors should read the Note Regarding Forward Looking Statements at the end of this press release.
Highlights for the three months and year ended December 31, 2012
-- 2012 average working interest sales volumes of approximately 2,600 barrels of oil equivalent per day ("boe/d") (91% oil) representing a year-over-year increase of 89%.-- Fourth quarter average working interest sales volumes of approximately 3,000 boe/d, up 48% from the 2011 comparable quarter and 6% from the third quarter.-- 2012 funds flow from operations of $35.3 million ($37.14 per boe or $1.43 per unit) representing a year-over-year increase of 78%.-- Fourth quarter funds flow from operations of $9.9 million ($36.06 per boe or $0.34 per unit), up 38% from the 2011 comparable quarter and 10% from the third quarter.-- Fourth quarter field netbacks of $46.67 per boe (2012 average - $47.31 per boe) with realized oil prices of $92.51 per barrel while WTI averaged $88.30.-- 2012 unitholder distributions held steady at $1.05 per unit ($0.0875 per unit per month).-- Total proved and probable reserves of approximately 15.6 million boe (68% proved, 29% proved producing).-- A 188% increase year-over-year in total proved reserves and a 107% increase year-over-year in proved developed producing reserves.-- An 86% increase in total proved reserves per Eagle unit and a 31% increase in proved plus probable reserves per Eagle unit, from December 31, 2011.-- A 2012 proved and probable recycle ratio of 1.9 times (similar to 2011) and a reserve life index of 14.3 years (up 78% from 2011).-- 28 (23.4 net) oil wells drilled during the year and 27 (22.5 net) oil wells tied in and brought on stream during the year.
Management's Commentary on Achievement of 2012 Guidance
The following analysis compares Eagle's 2012 actual results to its latest published 2012 guidance.
-- Overall, Eagle's actual volumes did not vary significantly from guidance and Eagle is well positioned to achieve 2013 production targets. -- Average working interest sales volumes of 2,600 boe/d were 96% of 2,700 boe/d guidance. -- Second half average working interest sales volumes of 2,900 boe/d were 97% of 3,000 boe/d guidance. -- Fourth quarter average working interest sales grew 6% from third quarter levels, as compared to a guided growth percentage of 11%. -- Exit rate production guidance of approximately 3,300 boe/d was achieved by early December. Included in Eagle's forecast exit rate was oil production which was subject to a non-consent penalty to a working interest partner in the Luling area. Contrary to Eagle's expectation and after the year end, the partner paid its full share of sunk capital costs to Eagle in return for reinstatement of its working interest share of production. This resulted in a reduction to Eagle's fourth quarter average oil production of approximately 80 boe/d and caused Eagle's full year, second half and fourth quarter actual volumes to come in slightly below guidance.-- Full year average operating costs were $14.48 per boe, compared to $15.00 per boe operating cost guidance. Quarter-over-quarter, operating costs in the fourth quarter also trended $0.30 per boe lower when compared to the third quarter.-- Full year funds flow from operations of $35.3 million was 95% of $37.0 million guidance, with the shortfall being attributable to the volume variances as discussed above.-- Full year capital expenditures of $43.5 million were at the expected $43.0 million level.-- 2012 ending debt to trailing cash flow ratio of 1.1x approximated guidance of 1.0x.-- Eagle paid a steady distribution of 8.75 cents per unit per month, consistent with its statement to sustain distributions.-- The full year payout ratio of 73% (derived by dividing unitholder distributions into funds flow from operations) approximates the stated guidance level of approximately 70%.-- Approximately 65% of Eagle's unitholders presently elect to receive their monthly distributions in Eagle's Premium Drip and distribution reinvestment programs. Financing by distribution reinvestment programs is beneficial to Eagle because it represents a significantly lower cost of capital to Eagle compared to other sources of equity financing available at any given time. Eagle utilizes such financing to fund the portion of its capital program which exceeds available cash flow after paying distributions. Such financing remains accretive as long as the rate of return of the capital program exceeds the cost of such capital to Eagle. As is the case with any capital investment, Eagle weighs the benefits against the returns earned from this method of financing and makes adjustments as deemed prudent.