The Company's Management's Discussion and Analysis ('MD&A') and audited consolidated financial statements are available on SEDAR (the System for Electronic Document Analysis and Retrieval) at www.sedar.com.
In 2019, the Company's primary objectives were to generate funds flow in excess of capital expenditures to repay debt and to maximize the profitability of its production by increasing its light oil weighting. Petrus generated funds flow of
Debt repayment - Reduction of debt is the Company's first and foremost priority. Since
Stronger natural gas pricing - The average benchmark natural gas price in
Higher funds flow per share - Fourth quarter 2019 production of 8,292 boe/d was 5% higher than the prior year and quarterly funds flow per share was
Free funds flow - In 2019 Petrus generated funds flow of
Increased light oil weighting - Fourth quarter average production included 1,834 bbl/d of light oil, which was a 47% increase from the third quarter. This was attributable to the new wells brought on production during the fourth quarter.
Increased light oil reserve volumes - In 2019, the Company realized
Company best operating costs - Total annual operating costs were 11% lower than 2018 at
Non-core asset disposition - In
2020 Outlook
Petrus' Board of Directors has approved a first quarter 2020 capital budget of
Fourth quarter average production was 8,292 boe/d in 2019 compared to 7,785 boe/d in the third quarter of 2019. During the second half of 2019 the Company drilled 7 gross (1.6 net) Cardium light oil wells. Average production from the 1.6 net wells over the fourth quarter, net to Petrus, was approximately 560 bbl/d of oil and approximately 1,600 mcf/d of natural gas. The Company's development plan is strategically balanced between increasing its Cardium light oil weighting in the Ferrier area and continuing to improve its balance sheet. In 2019, Petrus drilled 10 gross (3.1 net) Cardium light oil wells, increased its light oil weighting 24% from the beginning of 2018 and reduced net debt(1)
The average benchmark natural gas price in
Petrus' Board of Directors has approved a first quarter 2020 capital budget of
Petrus believes it is unique in the junior E&P company space, as few gas-weighted companies are able to repay debt and grow production and funds flow all within funds from operations. Over the past four years, Petrus has dramatically strengthened its business in order to improve its sustainability as well as mitigate commodity price risk. Operating costs have been reduced by 68% since 2012 and management believes Petrus' total cash costs of
Forward-Looking Statements
Certain information regarding Petrus set forth in this press release contains forward-looking statements within the meaning of applicable securities law, that involve substantial known and unknown risks and uncertainties. The use of any of the words 'anticipate', 'continue', 'estimate', 'expect', 'may', 'will', 'project', 'should', 'believe' and similar expressions are intended to identify forward-looking statements. Such statements represent Petrus' internal projections, estimates or beliefs concerning, among other things, an outlook on the estimated amounts and timing of capital investment, anticipated future debt, production, revenues or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements are only predictions and actual events or results may differ materially. Although Petrus believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Petrus' actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Petrus.
In particular, forward-looking statements included in this press release include, but are not limited to, statements with respect to: the anticipated impacts of TSP; continued expansion of the NGTL system and low
These forward-looking statements are subject to numerous risks and uncertainties, most of which are beyond the Company's control, including the impact of general economic conditions; volatility in market prices for crude oil, NGL and natural gas; industry conditions; currency fluctuation; imprecision of reserve estimates; liabilities inherent in crude oil and natural gas operations; environmental risks; incorrect assessments of the value of acquisitions and exploration and development programs; competition; the lack of availability of qualified personnel or management; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; hazards such as fire, explosion, blowouts, cratering, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; stock market volatility; ability to access sufficient capital from internal and external sources; completion of the financing on the timing planned and the receipt of applicable approvals and the other risks. With respect to forward-looking statements contained in this press release, Petrus has made assumptions regarding: future commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; future exchange rates; the impact of increasing competition; conditions in general economic and financial markets; availability of drilling and related equipment and services; effects of regulation by governmental agencies and future operating costs. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide shareholders with a more complete perspective on Petrus' future operations and such information may not be appropriate for other purposes. Petrus' actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that the Company will derive therefrom. Readers are cautioned that the foregoing lists of factors are not exhaustive.
This press release contains future-oriented financial information and financial outlook information (collectively, 'FOFI') about Petrus' prospective results of operations including, without limitation, its ability to repay debt, which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth above. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on FOFI. Petrus' actual results, performance or achievement could differ materially from those expressed in, or implied by, these FOFI, or if any of them do so, what benefits Petrus will derive therefrom. Petrus has included the FOFI in order to provide readers with a more complete perspective on Petrus' future operations and such information may not be appropriate for other purposes.
These forward-looking statements and FOFI are made as of the date of this press release and the Company disclaims any intent or obligation to update any forward-looking statements and FOFI, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
Contact:
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