CALGARY, June 16, 2011 /CNW/ -- CALGARY, June 16, 2011 /CNW/ -
Wrangler West Energy Corp. ("Wrangler West" or the "Company")
(TSXV: WX) announces today's filing on SEDAR (www.sedar.com) of the
Company's unaudited Financial Statements and related Management's
Discussion and Analysis ("MD&A") for the three months ended
March 31, 2011 with comparative data for the three months ended
March 31, 2010 and the year ended December 31, 2010.( )Effective
January 1, 2011, Wrangler West has prepared interim financial
statements and comparative information according to International
Financial Reporting Standards. Previously, the Company prepared
financial statements according to Canadian generally accepted
accounting principles. All documents may be viewed at
www.sedar.com. HIGHLIGHTS Three months ended March 31 2011 2010 %
Change OPERATIONAL HIGHLIGHTS Production Crude oil and NGL (bbls/d)
247 302 (18) Natural gas (mcf/d) 4,704 3,980 18 Total (boe/d) 1,031
965 7 Prices Crude oil and NGL ($/bbl) 78.39 74.21 6 Natural gas
($/mcf) 3.92 5.72 (31) Per boe ($) Petroleum and natural gas
revenue 36.66 46.80 (22) Royalties (5.39) (7.28) (26) Operating
expenses (15.38) (13.47) 14 Field netback 15.89 26.05 (39) General
and administrative (3.31) (3.22) 3 Interest (0.63) (1.12) (44)
Funds flow from operations 11.95 21.71 (45) Depletion,
depreciation, and amortization (16.09) (14.10) 14 Accretion (0.20)
(0.25) (20) Share-based payments - (0.71) (100) Deferred income tax
(benefit) 1.08 (2.26) (148) Gain (loss) on sale of assets 0.02
(0.12) (117) Net earnings (loss) (3.24) 4.27 (176) FINANCIAL
HIGHLIGHTS ($ thousand) Petroleum and natural gas revenue 3,401
4,066 (16) Royalties (500) (633) (21) Operating expenses (1,427)
(1,170) 22 General and administrative (307) (280) 10 Interest (59)
(97) (39) Funds flow from operations 1,108 1,886 (41) Depletion,
depreciation, and amortization (1,493) (1,225) 22 Accretion (18)
(22) (18) Share-based payments - (62) (100) Deferred income tax
(benefit) 101 (196) (152) Gain (loss) on sale of assets 2 (11)
(118) Net earnings (loss) (300) 370 (181) Outstanding shares
(thousand) Weighted average - basic 6,466 6,437 - Weighted average
- diluted 6,602 6,550 1 Funds flow from operations - basic and
diluted ($/share) 0.17 0.29 (41) Net earnings (loss) - basic and
diluted ($/share) (0.05) 0.06 (183) Total assets ($ thousand)
34,172 35,164 (3) Wrangler West converts petroleum and
natural gas reserves and volumes to a common unit of measure on a
basis of six thousand cubic feet ("mcf") of natural gas equals one
barrel ("bbl") of oil. Disclosure using barrels of oil
equivalent ("boe") may be misleading, particularly if used in
isolation. The basis for the boe conversion ratio of 6 mcf equals
one bbl is an energy equivalency conversion method, primarily
applicable at the burner tip. This conversion rate does not
represent a value equivalency at the wellhead. The Company
calculates boe per day based on total production for the period
divided by the number of days during the period. Wrangler West
Energy Corp. ("Wrangler West" or the "Company") presents operating
and financial results for 2011 first quarter. Wrangler West
is a Canadian junior oil and natural gas exploration company
focused on generating shareholder value by exploring for,
developing and producing natural gas and crude oil from properties
located in the Province of Alberta. 2011 First Quarter Highlights
-- $3.4 million in revenue -- $1.1 million in funds flow from
operations -- $0.9 million in capital expenditures -- potential
asset disposition of Grand Forks oil pool Review of First Quarter
For the three months ended March 31, 2011, Wrangler West produced
an average of 1,031 boe per day, higher by seven percent when
compared to the same period one year ago. However, our field
netback fell significantly as Wrangler West experienced a 31
percent decrease in the natural gas price received. A six
percent increase in crude oil price slightly offset the 2011 first
quarter lower netback. Operating costs increased 14 percent
on a per boe basis, somewhat higher than expected as we battled to
keep production moving through an unusually cold winter.
Funds flow from operations, at $1.1 million, declined
year-over-year and compared to 2010 fourth quarter which had funds
flow of $1.4 million. Capital Expenditures Wrangler West invested
$0.9 million in capital expenditures during 2011 first
quarter. The Company acquired land and conducted multiple
seismic programs prior to break-up. Seismic and land
acquisitions accounted for 72 percent of 2011 first quarter capital
expenditures. Wrangler West will continue to build quality,
seismically-defined drilling targets throughout 2011. Our
capital expenditures forecast is $8.0 million for the current
fiscal year. Commodity Prices During 2011 first quarter, natural
gas prices demonstrated unexpected seasonal weakness.
Although a long, cold winter persisted throughout most of North
America, natural gas prices remained weak throughout the heating
season, a period when, typically, natural gas experiences some
strength as storage volumes are depleted. During the winter of
2010-2011, natural gas storage volumes were slightly below the
five-year average and injection into storage was below
expectations. It is likely the lower injection rate is a
result of the drilling rig fleet being kept busy pursuing crude oil
exploration and development opportunities. Drilling for
natural gas appears to have dropped significantly as much of the
drilling to maintain land assets in the United States was
completed. The natural gas business remains volatile. In the
near term, we continue to expect natural gas prices will remain
somewhat range-bound between $4.00 and $5.00. North American
natural gas markets are showing some signs of life as we move into
the summer. A few well-respected analysts are suggesting the
bottom may have occurred and are indicating positive price
projections moving forward. Crude oil prices continue to be robust
with the WTI benchmark hovering around $100 per bbl. World
events influence the premium in crude oil price although ongoing
consumption is relatively stable. As consumption in Asia and
other developing economies improves demand, prices can be expected
to remain strong. Economic recovery throughout North America
is still tentative and high energy costs are deemed a threat to any
potential recovery. The energy producing countries will
carefully monitor supply and demand to maximize crude oil prices
while avoiding the potential destruction of purchasing power.
Their objective is to ensure production of adequate volumes to
sustain a healthy balance in crude oil supply and demand.
This scenario has played out many times in recent history as global
issues impact world energy markets. Outlook for 2011 Once again,
Wrangler West is focused on finding economic crude oil and natural
gas within the context of the commodity prices we receive. As
the crude oil market is quite strong, we are investigating the
potential asset disposition of our Grand Forks oil producing
properties. If we complete this process, the proceeds would
be applied to bank indebtedness. We expect to invest most of
our 2011 capital expenditures budget of $8.0 million in crude oil
exploration activity. We have a growing inventory of
opportunities that are approaching the drill-ready stage and we
expect to accelerate activity in the latter half of 2011. WRANGLER
WEST ENERGY CORP. STATEMENTS OF FINANCIAL POSITION (Stated in
thousands of dollars) (Unaudited) March 31, December 31, January 1,
2011 2010 2010 (note 17) (note 17) Assets Current assets Accounts
receivable (note 4 (b)) $ 1,307 $ 1,406 $ 1,409 Income tax
receivable - 74 531 Prepaid expenses 184 144 371 Assets held for
sale (note 9) - - 4,084 1,491 1,624 6,395 Exploration and
evaluation (note 8) - - 44 Property, plant and equipment (note 7)
32,681 33,335 32,114 $ 34,172 $ 34,959 $ 38,553 Liabilities and
shareholders' equity Current liabilities Bank indebtedness (note
13) $ 7,117 $ 6,354 $ 8,731 Accounts payable and accrued
liabilities 2,093 3,260 3,358 Decommissioning obligations related
to assets held for sale (note 9) - - 573 9,210 9,614 12,662
Decommissioning obligations (note 15) 2,724 2,705 2,024 Deferred
income tax 3,301 3,403 3,833 15,235 15,722 18,519 Shareholders'
equity Share capital (note 11) 12,402 12,402 12,194 Contributed
surplus 4,538 4,538 4,313 Retained earnings 1,997 2,297 3,527
18,937 19,237 20,034 $ 34,172 $ 34,959 $ 38,553 WRANGLER
WEST ENERGY CORP. STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(LOSS) (Stated in thousands of dollars, except per share amounts)
(Unaudited) Three months ended March 31 2011 2010 (note 17) Revenue
Petroleum and natural gas sales $ 3,401 $ 4,066 Royalties (500)
(633) 2,901 3,433 Expenses Operating 1,427 1,170 General and
administrative 307 280 Share-based payments - 62 Depletion,
depreciation and amortization 1,493 1,225 Results from operating
activities (326) 696 Finance (Gain) loss on sale of assets (2) 11
Interest and accretion (note 5) 77 119 75 130 Earnings (loss)
before income tax (401) 566 Deferred income tax (benefit) (101) 196
Net earnings (loss) and comprehensive income (loss) $ (300) $ 370
Net earnings (loss) per share (note 12) Basic and diluted $ (0.05)
$ 0.06 WRANGLER WEST ENERGY CORP. STATEMENT OF CHANGES IN
SHAREHOLDERS' EQUITY (Stated in thousands of dollars) (Unaudited)
Number of Total common Share Contributed Retained shareholders'
shares capital surplus earnings equity Balance at January 1, 2011
6,466 $ 12,402 $ 4,538 $ 2,297 $ 19,237 Options exercised - - - - -
Share-based payments - - - - - Net earnings (loss) - - (300) (300)
Balance at March 31, 2011 6,466 $ 12,402 $ 4,538 $ 1,997 $ 18,937
Balance at January 1, 2010 6,416 $ 12,194 $ 4,313 $ 3,527 $ 20,034
Options exercised 25 112 (55) - 57 Share-based payments - - 89 - 89
Net earnings - - - 370 370 Balance at March 31, 2010 6,441 $ 12,306
$ 4,347 $ 3,897 $ 20,550 WRANGLER WEST ENERGY CORP.
STATEMENTS OF CASH FLOWS (Stated in thousands of dollars)
(Unaudited) Three months ended March 31 2011 2010 Cash provided by
(used in): Operating Net earnings (loss) $ (300) $ 370 Items not
involving cash: Depletion, depreciation and amortization 1,493
1,225 Accretion 18 22 Share-based payments - 62 (Gain) loss on sale
of assets (2) 11 Deferred income tax (benefit) (101) 196 1,108
1,886 Change in non-cash operating working capital (note 6) 179
(456) 1,287 1,430 Financing Decrease in bank indebtedness, original
credit facility - (3,492) Increase in bank indebtedness, new credit
facility 763 - Issuance of common shares - 56 763 (3,436) Investing
Property, plant and equipment expenditures (864) (1,880) Proceeds
on sale of property, plant and equipment 26 10 Proceeds on sale of
assets held for sale (note 9) - 3,499 Change in non-cash investing
working capital (note 6) (1,212) 377 (2,050) 2,006 Cash and cash
equivalents, beginning and end of period $ - $ - Supplementary cash
flow information Interest paid 57 79 Income tax paid (received)
(74) 6 Reader Advisory This news release contains
forward-looking statements about potential new crude oil and
natural gas drilling, production operations, sources and use of
capital, potential asset purchases or dispositions and expected
future operations. Although Wrangler West believes the expectations
reflected in these forward-looking statements are reasonable, undue
reliance should not be placed on them because the Company can give
no assurance 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. A more
detailed discussion of forward-looking statements is provided in
Wrangler West's Management's Discussion and Analysis for the three
months ended March 31, 2011 which is filed on SEDAR
(www.sedar.com). The forward-looking statements contained in
this news release are made as of the date hereof and Wrangler West
undertakes no obligation 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. Corporate Profile Wrangler West is a
Canadian junior crude oil and natural gas producer which explores
for and develops crude oil and natural gas production assets in the
Province of Alberta. Since inception, our mandate has been to use
the drill bit to add shareholder value. Disciplined management of
our operations and production portfolio creates sufficient funds
flow to support ongoing operations. Wrangler West intends to
continue to reinvest funds flow from operations and other available
capital to protect current and add future value. Wrangler
West trades on the TSX Venture Exchange under the symbol "WX".
Additional Information Wrangler West files additional shareholder
and public information on SEDAR accessible at www.sedar.com. This
includes the Statement of Reserves Data and Other Oil and Gas
Information Form NI 51-101 F1, F2 and F3 effective December 31,
2010. Alternatively, to obtain copies of published corporate
information, contact Crista L. Ferguson, Chief Financial Officer,
Wrangler West Energy Corp., 1950, 444 Fifth Avenue SW, Calgary,
Alberta, Canada T2P 2T8 (telephone +1 403 290 6800 or e-mail
info@wranglerwest.ca). The TSX Venture Exchange has not reviewed,
and does not accept responsibility for, the adequacy or accuracy of
this news release. To view this news release in HTML
formatting, please use the following URL:
http://www.newswire.ca/en/releases/archive/June2011/16/c6966.html p
align="justify" bWran/bbgler West Energy Corp./bbr/ Steven F.
Johnsonbr/ President and Chief Executive Officerbr/ a
href="mailto:info@wranglerwest.ca"info@wranglerwest.ca/abr/
telephone: (403) 290-6800 /p
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