Oilexco Announces Third Quarter Results
17:49 EST Wednesday, November 12, 2008
CALGARY, ALBERTA--(Marketwire - Nov. 12, 2008) - Oilexco Incorporated ("Oilexco" or "the Company") (TSX:OIL) (LSE:OIL) is pleased to announce the Company's third quarter results for the three and nine months ended 30 September 2008.
Arthur Millholland, President and Chief Executive Officer, commented:
"Oilexco successfully completed a number of key steps in the third quarter that will allow the Company to increase production in the near term. By late Q4 2008 or early Q1 2009, new wells from the Shelley, Nicol and Caledonia fields are expected to begin production. The Balmoral Floating Production Vessel underwent a particularly intensive period of annual maintenance in preparation for handling increased production in 2009 and 2010."
THIRD QUARTER / FIRST NINE MONTH HIGHLIGHTS
Financial Performance
- Revenues of $95.3 million in the third quarter and $496.1 million for the first 9 months.
- Cash flow from operations of $114.2 million for the third quarter and $394.8 million for the first 9 months.
- Net income of $59.1 million in the third quarter and $81.7 million for the first 9 months.
- EBITDA of $52.0 million in the third quarter and $370.3 million for the first 9 months.
- Announcement today of the extension of Pounds Sterling 70 million of the Company's Pre-development Facility until 30 November 2009.
Production
- Production in Q3 2008 averaged 11,951 Bbls / day, and average daily sales were 8,623 Bbls / day, reflecting a production underlift. Lower production was a result of the planned annual maintenance turnaround on the Balmoral FPV that shut in production for approximately half of the quarter.
- Received average price of $120.16 per barrel of oil in Q3 2008 resulting in operating netback of $95.49 per barrel.
Operational / Drilling
- Successful exploration drilling at Moth resulted in a significant discovery, with flow test calculations suggesting the well could be capable of producing 44 Mmcf / day and 4,400 Bbls / day of condensate. Partners engaged in planning discussions for future appraisal wells in 2009.
- Development activities progressed on the 100% owned Shelley project. First oil is on target for December 2008 or early 2009 depending on weather conditions.
- Construction and initial commissioning activities completed on the Sevan Voyageur FPSO, which is scheduled to be deployed to the Shelley field in Q4.
- Successful appraisal drilling at the Caledonia field led to a fast track development plan for a new well targeting first oil in spring 2009.
- Subsequent to the end of the quarter, appraisal drilling encountered additional oil in Block 22/14a which is located immediately east of Huntington.
Outlook
- Focus for Q4 2008 is bringing new wells into production.
- Final tie in and hook up activities to be completed on Shelley field once Sevan Voyageur FPSO is deployed.
- The second production well at Nicol will be completed and tied in by end of December or early 2009 depending on weather conditions.
- Contractors are replacing equipment and re-working several previously shut in wells on the Balmoral field which is set to resume full production in Q4 2008.
The results and associated Management Discussion and Analysis and Financial Statements are at www.oilexco.com and www.sedar.com.