TIDMEDG
RNS Number : 4614G
Edge Resources Inc.
04 March 2015
FOR IMMEDIATE RELEASE
TSX Venture Exchange Symbol: EDE
AIM Exchange Symbol: EDG March 4, 2015
EDGE RESOURCES INC. Calgary, Alberta
Edge Resources Inc. Announces Strong Quarterly Performance
Edge Resources Inc. ("Edge" or the "Company") is pleased to
announce its unaudited third quarter results for the three month
("Q3 2015") and nine month periods ended December 31, 2014.
Detailed operating and financial results are presented in Edge's
unaudited quarterly financial statements and related Management
Discussion & Analysis ("MD&A"), which can be accessed on
the Company's website (www.edgeres.com) and on SEDAR
(www.sedar.com) and are briefly summarised below.
Financial Highlights for the three and nine month periods ending
December 31, 2014:
Ø Average production in the quarter increased 20% over the
previous quarter to 569 boepd (474 boepd in Q3 2014), despite
temporarily shutting-in some heavy oil wells during the
construction of the water disposal facility in Eye Hill.
Ø Oil and Natural Gas Sales of $2,608,000 during the quarter
(versus $1,932,000 million one-year earlier, with WTI near
US$100/bbl) and $8,439,000 for the nine month period, compared to
$6,820,000 for the nine month period one-year earlier.
Quarter-over-quarter sales increased 11% from $2,357,000 for the
period ended September 30, 2014.
Ø Cash generated from operating activities increased 470% to
$564,000 versus $99,000 the previous quarter. For the nine month
period ending December 31, 2014, cash from operating activities
increased 45% to $1,805,000, compared to $1,241,000 for the nine
months ended September 30, 2014 and $901,000 for the nine months
ended December 31, 2013.
Ø Operating Costs for oil decreased again this quarter to
$16.82/bbl, a 21% decrease compared to the previous quarter. This
lower operating cost does not yet include the positive impact from
the water disposal facility, which became operational after the
quarter end.
Ø During the quarter, oil prices dropped materially from WTI
US$90/bbl on October 1, 2014 to close at WTI US$53/bbl December 31,
2014, a 41% price slide in a 91 day period.
Brad Nichol, President and CEO of Edge commented, "Despite the
headwinds the industry is facing at the moment, our quarterly
results were excellent. We generated significant cash from our
operations and kept a very tight rein on costs and operational
efficiencies. These downturns in our industry allow our team to
demonstrate our specialty, which is running a tight, efficient
business no matter how hard the wind is blowing in our faces. This
quarter, the Company actually achieved production increases,
without additional capital expenditure on drilling wells.
Additionally, we are looking forward to reaping the savings from
our new water disposal facility, which became fully operational in
January." Nichol added, "With WTI prices hovering around US$50/bbl,
we are unlikely to consume our existing inventory of drilling
locations; however, we are keen to acquire production, reserves,
land and additional drilling locations when the cost of those
acquisitions are expected to be at their lowest in a generation. We
expect the competition for assets to be less intense in the heavy
and medium oil regimes, where operational expertise is a
significant barrier to entry; thus, we intend to remain focused on
our heavy and medium oil sandbox where we have already established
a clear competitive operational advantage over other potential
consolidators."
For more information, visit the company website: www.edgeres.com
or contact:
Brad Nichol, President and CEO Phone: +1 403 767 9905
Sanlam Securities UK Limited (Joint Broker and NOMAD) Phone: +44
20 7628 2200
Simon Clements / James Thomas / Max Bascombe
SP Angel Corporate Finance LLP (Joint Broker) Phone: +44 20 3463
2260
John MacKay / Richard Hail
About Edge Resources Inc.
Edge Resources is focused on developing a balanced portfolio of
oil and natural gas assets from properties in Alberta and
Saskatchewan, Canada. Management has consistently focused on:
1. Shallow, vertical, conventional programs with reduced
capital, operational and geological risks
2. Very high or 100% working interests and fully operated assets
3. Pools and horizons with exceptionally high reserves in place
The management team's very high drilling success rate is based
on the safe, efficient deployment of capital and a proven ability
to efficiently execute in shallow formations, which gives Edge
Resources a sustainable, low-cost, competitive advantage.
Condensed Interim Balance Sheets
(amounts in Canadian dollars)
(unaudited)
December
31, March 31,
Note 2014 2014
Assets
Current assets $ $
Cash and cash equivalents 34,401 39,446
Accounts receivable 749,329 1,401,293
Deposits and prepaid expenses 110,778 86,836
Fair value of derivative
instruments 247,390 -
Total current assets 1,141,898 1,527,575
------------------------------------ ----- ------------- ------------
Non-current assets
Exploration and evaluation
assets 74,061 74,061
Property, plant and equipment 3 36,068,261 37,768,037
------------------------------------ ----- ------------- ------------
Total non-current assets 36,142,322 37,842,098
------------------------------------ ----- ------------- ------------
Total assets 37,284,220 39,369,673
------------------------------------ ----- ------------- ------------
Liabilities
Current liabilities
Bank overdraft - 858,756
Accounts payable and accrued
liabilities 2,469,394 1,832,726
Bank debt 4 5,800,000 5,700,000
Fair value of derivative
instruments - 667,316
Total current liabilities 8,269,394 9,058,798
Loans payable 5 10,446,356 9,843,616
Decommissioning provisions 7,853,000 6,044,000
------------------------------------ ----- ------------- ------------
Total liabilities 26,568,750 24,946,414
------------------------------------ ----- ------------- ------------
Shareholders' Equity
Share capital 36,111,048 36,094,048
Contributed surplus 2,645,237 2,425,249
Deficit (28,040,815) (24,096,038)
------------------------------------ ----- ------------- ------------
Total shareholders' equity 10,715,470 14,423,259
------------------------------------ ----- ------------- ------------
Total liabilities and shareholders'
equity 37,284,220 39,369,673
------------------------------------ ----- ------------- ------------
Condensed Interim Statements of Net Loss and Comprehensive
Loss
(amounts in Canadian dollars)
(unaudited)
Three months ended Nine months ended
December December December December
31, 31, 2013 31, 31, 2013
Note 2014 2014
Revenue
Oil and natural gas
sales $ 2,608,050 $ 1,932,460 $ 8,439,181 $ 6,819,801
Royalties (520,231) (314,986) (1,579,546) (1,132,406)
--------------------------------- ----- ------------- ------------ ------------- -------------
Revenue, net of royalties 2,087,819 1,617,474 6,859,635 5,687,395
--------------------------------- ----- ------------- ------------ ------------- -------------
Other income (losses)
Realized gain (loss)
on financial derivatives 65,303 (43,219) (245,084) (139,548)
Unrealized gain (loss)
on financial derivatives 451,500 (190,536) 914,706 (23,564)
Gain on disposition
of oil and natural gas
interests 3 - - - 185,000
Loss on settlement of
decommissioning provision (28,379) - (28,379) -
Other income 5,388 12,567 27,580 39,050
--------------------------------- ----- ------------- ------------ ------------- -------------
Total income, before
expenses 2,581,631 1,396,286 7,528,458 5,748,333
--------------------------------- ----- ------------- ------------ ------------- -------------
Expenses
Operating 870,643 841,265 2,706,339 2,525,505
Transportation 124,560 88,806 318,773 254,916
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