Gear Energy Ltd. Announces Fourth Quarter and Year-End 2015 Results
(firmenpresse) - CALGARY, ALBERTA -- (Marketwired) -- 02/17/16 -- Gear Energy Ltd. ("Gear" or the "Company") (TSX: GXE) is pleased to provide the following fourth quarter and year-end operating update to shareholders. For more information in conjunction with this release, please refer to Gear''s Annual Audited Financial Statements, Management''s Discussion and Analysis ("MD&A") for the years ended December 31, 2015 and 2014, and 2015 Reserves Press Release titled "Gear Energy Ltd. Announces Year-End Reserves", all of which are available for review on Gear''s website at and on .
Financial Summary
HIGHLIGHTS
In light of continued oil price weakness, Gear focused on sustainability by adopting a cautious view throughout 2015. Of the total $39 million of cash flow generated through the year, $25 million or 64 per cent was directed towards reducing outstanding debt. In addition, Gear successfully raised net $9.5 million through an equity issuance in the fourth quarter of 2015. In total these activities resulted in net debt declining by 33 per cent from the prior year. In addition, $14.8 million, or 22 per cent of the total $66 million of current net debt was moved to a five year convertible debenture structure due in November 2020. With the remaining $14.2 million of cash flow Gear completed a 100 per cent successful 12 well horizontal heavy oil drilling program. The Gear team has a consistent track record of successfully and economically developing its asset base and remains confident in the strength and depth of its undeveloped opportunities. Gear believes that future capital investments can continue to yield strong positive rates of return with only a slight improvement in the oil price environment.
ADVISORY ON FORWARD-LOOKING STATEMENTS: This press release contains certain forward-looking information and statements within the meaning of applicable securities laws. In particular, this press release contains forward-looking information relating to, among other things: expectations as to Gear''s undeveloped opportunities, expectations of number of sections of prospective land, expectations of future drilling locations, expected budget for the first half of 2016, expectations that cash flow and hedging gains will be focused on reducing debt and expectation that Gear will retain optionality in planning future capital spending and be better able to maximize the returns on capital for the large inventory of low risk drilling and select acquisition opportunities. The use of any of the words "expect", "continue", "estimate", "may", "will", "should", "believe", "plans", "cautions" and similar expressions are intended to identify forward-looking information or statements. Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Gear which have been used to develop such statements and information but which may prove to be incorrect. Although Gear believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Gear can give no assurance that they will prove to be correct.
Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. In particular, in addition to other factors and assumptions which may be identified herein, assumptions have been made regarding: that Gear''s exploration and development activities will be successful or that material volumes of petroleum and natural gas reserves will be encountered, or if encountered can be produced on a commercial basis; that additional drilling operations will be successful such that further development activities is warranted; that Gear''s efforts to raise additional capital will be successful; that Gear will continue to conduct its operations in a manner consistent with past operations; results from drilling and development activities will be consistent with past operations; the accuracy of the estimates of Gear''s reserve volumes; the general stability of the economic and political environment in which Gear operates; drilling results; field production rates and decline rates; the general continuance of current industry conditions; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Gear to secure adequate product transportation; future commodity prices and heavy oil differentials; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Gear operates; and the ability of Gear to successfully market its oil and natural gas products; the ability of Gear to obtain financing on terms acceptable to Gear; and the continued availability of credit under the Company''s credit facilities.
Further, events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Gear, including, without limitation: changes in commodity prices and heavy oil differentials; changes in the demand for or supply of Gear''s products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Gear or by third party operators of Gear''s properties, increased debt levels or debt service requirements; any actions by Gear''s lenders to reduce the availability under its credit facilities, to demand repayment in full or to enforce its security; inaccurate estimation of Gear''s oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Gear''s public disclosure documents. Additional information regarding some of these risk factors may be found under "Risk Factors" in Gear''s annual information form for the year ended December 31, 2015, which is expected to be filed on or before March 31, 2016. The reader is cautioned not to place undue reliance on this forward-looking information. The forward-looking statements contained in this press release are made as of the date hereof and Gear undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
NON-GAAP Measures: This press release contains the terms cash flow from operations, net debt, operating netback and corporate netback (or as sometimes referred to herein as "cash flow netback"), which do not have standardized meanings under Canadian generally accepted accounting principles ("GAAP") and therefore may not be comparable with the calculation of similar measures by other companies. Management believes that these key performance indicators and benchmarks are key measures of financial performance for Gear and provide investors with information that is commonly used by other oil and gas companies. Cash flow from operations is calculated as cash flow from operating activities before changes in noncash operating working capital and decommissioning liabilities settled. Net debt is calculated as debt less current working capital items, excluding risk management contracts. Operating netbacks are presented both before and after taking into account the effects of hedging and are calculated based on the amount of revenues received on a per unit of production basis after royalties and operating costs. Corporate netbacks are presented after taking into account the effects of hedging and are calculated based on the amount of revenues received on a per unit of production basis after royalties, operating costs, general and administrative expenses, interest and foreign exchange gain or loss. Additional information relating to certain of these non-GAAP measures, including the reconciliation between cash flow from operations and cash flow from operating activities, can be found in the MD&A.
ADVISORY ON USE OF "BOEs": "BOEs" may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (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. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
DRILLING LOCATIONS: This press release discloses future drilling locations, which can be classified in three categories: (i) proved locations; (ii) probable locations; and (iii) unbooked locations. Proved locations and probable locations are derived from GLJ reserves report as of December 31, 2015 and account for drilling locations that have associated proved and/or probable reserves, as applicable. Unbooked locations are internal estimates based on Gear''s prospective acreage and an assumption as to the number of wells that can be drilled per section based on industry practice and internal review. Additional information with respect to these drilling locations can be found in Gear''s 2015 Reserves Press Release titled "Gear Energy Ltd. Announces Year-End Reserves" which has been filed concurrently with this press release.
Contacts:
Gear Energy Ltd.
Ingram Gillmore
President & CEO
403-538-8463
Gear Energy Ltd.
David Hwang
Vice President Finance & CFO
403-538-8437
Themen in dieser Pressemitteilung:
Unternehmensinformation / Kurzprofil:
Datum: 17.02.2016 - 18:14 Uhr
Sprache: Deutsch
News-ID 1415943
Anzahl Zeichen: 0
contact information:
Contact person:
Town:
CALGARY, ALBERTA
Phone:
Kategorie:
Oil & Gas
Typ of Press Release:
type of sending:
Date of sending:
Anmerkungen:
Diese Pressemitteilung wurde bisher 178 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Gear Energy Ltd. Announces Fourth Quarter and Year-End 2015 Results
"
steht unter der journalistisch-redaktionellen Verantwortung von
Gear Energy Ltd. (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
