ENP Newswire -
Release date- 13082014 - CALGARY -
The following are Cequence's financial and operating highlights for the second quarter of 2014:
Produced a corporate record average production of 12,735 boe/d in the second quarter an increase of 14 percent from the prior year and 10 percent over the first quarter of 2014;
Increased funds flow from operations by 36 percent from the prior year to
Corporate operating netbacks increased 22 percent from the prior year to
Commenced drilling operations earlier than expected in June with a two rig drilling program and
Second quarter funds flow from operations and net earnings increased from the prior year driven by the increase in production volumes of 14 percent and an increase in realized sales prices after hedging of 22 percent from the prior year. In the second quarter of 2014
Funds flow from operations increased to
Net debt and working capital deficiency at
In the second quarter, production averaged 12,735 boepd, a 10 percent increase from the first quarter of 2014 and a new record for the Company. Higher production was a result of new wells onstream at
Capital expenditures in the second quarter were
Cequence recently announced its capital budget of
Cequence expects production to grow to 15,000 boe/d to exit the first quarter of 2015. Drilling commenced on the Company's first Montney pad in early June as dry spring conditions allowed for the mobilization of equipment earlier than anticipated. Two Montney wells have now been drilled and the third well was spud on
The Company's second drilling rig was activated in June and recently finished drilling a Dunvegan well that is expected to be completed and on production by the end of August. The well is the third Dunvegan well to be drilled in the Company's liquids rich acreage at Simonette. The first two wells drilled into this pool are two of the most economic wells that the Company has drilled to date. The second rig will drill a Falher development well prior to commencing a second Montney pad program.
This pad-style drilling in the Montney represents a significant shift in the Company's operating strategy and is the logical progression in the development of the Simonette Montney play.
Cequence is a publicly traded Canadian energy company involved in the exploration, exploitation, acquisition, development and production of natural gas and crude oil in western
President and Chief Executive Officer
Tel: (403) 218-8850
Tel: (403) 806-4041
Forward looking Statements or Information
Certain statements included in this press release constitute forward-looking statements or forward-looking information under applicable securities legislation. Such forward-looking statements or information are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions.
Forward-looking statements or information typically contain statements with words such as 'anticipate', 'believe', 'expect', 'plan', 'intend', 'estimate', 'propose', 'project' or similar words suggesting future outcomes or statements regarding an outlook.
Forward-looking statements or information in this press release may include, but are not limited to, statements or information with respect to: the Company's guidance and forecasts; expected capital expenditures, business strategy and objectives and future development, and drilling, plans, including the anticipated benefits resulting therefrom and the timing thereof. Forward-looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information but which may prove to be incorrect.
Although the Company believes that the expectations reflected in such forward-looking statements or information are reasonable. Undue reliance should not be placed on forward-looking statements because the Company can give no assurance that such expectations will prove to be correct.
In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding, among other things: the impact of increasing competition; the timely receipt of any required regulatory approvals; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner; the ability of the operator of the projects which the Company has an interest in to operate the field in a safe, efficient and effective manner; the ability of the Company to obtain financing on acceptable terms; field production rates and decline rates; the timing and costs of pipeline, storage and facility construction and expansion and the ability of the Company to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters and the ability of the Company to successfully market its oil and natural gas products.
Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.
Forward-looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Company and described in the forward-looking statements or information.
These risks and uncertainties may cause actual results to differ materially from the forward-looking statements or information. The material risk factors affecting the Company and its business are contained in the Company's Annual Information Form which is available on SEDAR at www.sedar.com.
The forward-looking statements or information contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise unless required by applicable securities laws. The forward looking statements or information contained in this press release are expressly qualified by this cautionary statement.
The press release contains references to terms commonly used in the oil and gas industry. Netback is not defined by IFRS in
Funds flow from operations is a non-GAAP term that represents cash flow from operating activities before adjustments for decommissioning liability expenditures, proceeds from the sale of commodity contracts and changes in non-cash working capital. The Company evaluates its performance based on earnings and funds flow from operations.
The Company considers funds flow from operations to be a key measure as it demonstrates the Company's ability to generate the cash flow necessary to fund future growth through capital investment and to repay debt. The Company's calculation of funds flow from operations may not be comparable to that reported by other companies. Funds flow from operations per share is calculated using the same weighted average number of shares outstanding used in the calculation of income (loss) per share.
Non-GAAP measures do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers.
BOEs are presented on the basis of one BOE for six Mcf of natural gas. Disclosure provided herein in respect of BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
For the first six months of 2014, the ratio between the average price of West Texas Intermediate ('WTI') crude oil at Cushing and
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