Pine Cliff Energy announces fourth quarter and annual 2015 results

Friday, March 18, 2016      
 

Pine Cliff Energy Ltd. (TSX:PNE) is pleased to announce its fourth quarter and year-end financial and operating results and the filing of its 2015 disclosure documents.

2015 was the busiest year in Pine Cliff's history and significant highlights from the fourth quarter were:

  • Closed the largest acquisition in the Company's history, adding approximately 11,730 barrels of oil equivalent ('Boe') per day of production in the Ghost Pine and Viking areas of Central Alberta for $185 million, before adjustments. This acquisition lowered Pine Cliff's industry leading production decline rate to less than 12%, decreased its corporate break-even point to less than $2.00 per mcf (before capital expenditures) and materially increased its drilling inventory;
  • Closed $72 million of equity financings;
  • Amended its credit facility, increasing the borrowing base to $185 million, and added two Canadian Financial Institutions for a total of five in the syndicate;
  • Attained record average daily sales volumes of 15,051 Boe per day as compared to 12,504 Boe per day in the third quarter of 2015 and exited the year at approximately 23,150 Boe per day, with a year-over-year per basic share production growth of 49%; and
  • Achieved significant growth in total proved reserves of 128% to 59 million Boe and total proved plus probable reserves of 124% to 79 million Boe, representing year-over-year basic per share reserves growth of 75% and 72%, respectively.

The Company is also pleased to announce that on March 3, 2016, Pine Cliff shares began trading on the Toronto Stock Exchange (PNE-T).

Strategic Growth in a Chaotic Time

The Company's goal has always been to deliver long term value to shareholders. The Company raised equity in one of the toughest capital markets in recent memory to not overly extend its debt and firmly believes that buying quality assets in times of industry distress will serve shareholders well over time. Pine Cliff is staying focused on its key strengths by minimizing capital expenditures while continuing to lower operating costs.

Outlook

The drop in oil and gas prices in the past 12 months has demanded that all companies in the industry reexamine their growth strategies as access to capital is currently being restricted. The 2015-16 winter was one of the warmest in North American recorded history and that has punished the natural gas price due to increased gas in storage. However, natural gas demand continues to quietly accelerate with coal to gas shifting continuing, LNG exports commencing and pipeline exports to Mexico now surpassing 3.5 BCF/day. Natural gas supply growth has finally begun to drop due to production declines, associated gas reductions from reduced oil drilling and fewer natural gas rigs in operation due to the poor economics of drilling. Pine Cliff remains confident that the gas price will need to eventually react positively to these changes, but will watch this closely and take whatever measures management believes prudent to protect the Company in the meantime. Pine Cliff has always held the view that this is a marathon, not a sprint. The business plan is designed so the Company survives during the difficult times so that it can prosper in the better times.


 

Article Tags

Pine Cliff Energy Ltd. Canada North America Finance Operations Update LNG


This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser. More


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