FOURTH QUARTER 2012 HIGHLIGHTS
-- Achieved another quarterly production record with average production of 3,130 boe/d (97% oil) representing a quarterly increase of 47% from the third quarter of 2012.-- The Company spent $26 million on development activities and $41 million on acquisitions. 28 gross (23.9 net) Viking horizontal oil wells were drilled at 100% success. The Company also drilled a stratigraphic test well that was abandoned once core and log data were received.-- Attained record funds flow from operations of $15 million an increase of 47% from the third quarter 2012 funds flow of $10.3 million.-- Maintained our top decile corporate netback of in excess of $52/boe.-- Closed the previously announced property and corporate acquisitions that added 700 boe/d (90% oil) of production in December 2012.-- Completed a $68.9 million equity financing by issuing 26 million common shares at a price of $2.65 per common share.
-- Grew exit production to 4,000 boe/d, an increase of 3,000 boe/d (300%) from our January 2012 production volumes of 1,000 boe/d.-- The Company spent $126.3 million, including $55.2 million of development activities and $71.1 million of property and corporate acquisitions. Raging River drilled 69 (52.5 net) horizontal Viking wells at a 100% success rate. 2 (2.0 net) additional Viking vertical stratigraphic tests were drilled to assist in delineating the Viking reservoir.-- Increased Viking horizontal drilling inventory from 600 to in excess of 1,300 locations.-- Increased proven plus probable reserves by 11.7 mmboe (215%) to 17.2 mmboe (95% oil) and proven reserves by 7.7 mmboe (201%) to 11.5 mmboe (95% oil).-- Finding, development and acquisition ("FD&A") costs including a $167 million change in future development capital were $26.05 per boe on a proven plus probable basis. The recycle ratio was 2.0 times based on fourth quarter corporate netback of $52.41 per boe.-- Increased net asset value per share on a present value before tax of 10% ("PVBT10") to an estimated $2.75 per share at December 31, 2012. This is an increase of 71% from our PVBT10 of $1.61 per share at March 15, 2012.-- Subsequent to year end, Raging River increased its credit facility to $125 million from our initial credit facility of $45 million in March 2012. A strong balance sheet was maintained with year-end net debt of $15.2 million, representing 0.25 times debt to fourth quarter annualized cash flow.-- Increased net total land holdings in the Dodsland area from 76,000 net acres to approximately 110,000 net acres.
After a successful fourth quarter which saw 28 successful Viking horizontal oil wells drilled, Raging River continued its operational momentum into the first quarter of 2013. A total of 45 gross (38.3 net) horizontal Viking oil wells were drilled at a 100% success rate. 30 (25 net) of the 45 wells drilled have been on-stream for at least 30 days. The average oil rate of these wells was 55 bbls/d, equivalent to the average results of the 61 wells drilled by the Company in 2012.
Highlights of the drilling program are as follows:
-- The Company drilled 45 (38.3 net) Viking horizontal oil wells at 100% success rate. 18 previously undrilled sections were tested with successful wells.-- Beadle: The Company drilled six wells testing six new sections. These wells have been on production for 15-30 days at rates of 40-55 bbls/d exceeding the historical 30 bbl/d average. Management is very encouraged by the eight wells drilled since October 2012. Continued success could lead to further increases in our drilling inventory.-- Lucky Hills: The initial 2013 results continue the exceptional results of this area. The first 13 wells of 2013 have achieved 40 day production rates of 70 bbls/d of oil.-- Plato: 12 wells were placed on production in the first quarter with average 50 day production rates of 47 bbls/d of oil.-- Kerrobert: Raging River drilled 9 operated wells testing 5 previously undrilled sections. The first 7 wells of this program have achieved 30 day IP rates of 50 bbls/d of oil.