Spartan Energy Corp. reports results for fourth quarter and full year 2015
Spartan Energy Corp. (TSX:SPE) is pleased to report its financial and operating results for the fourth quarter and year ended December 31, 2015.
FOURTH QUARTER 2015 HIGHLIGHTS
- Achieved average production of 9,319 boe/d (95% liquids), a per share increase of 16% over the previous quarter and 6% over the fourth quarter of 2014.
- Realized continued improvements in operational efficiencies and cost reductions across all aspects of our business:
- Delivered operating and transportation costs of $16.48 per boe, a reduction of 6% from the third quarter of 2015 and 14% from the fourth quarter of 2014.
- Reduced average drill, complete and equip ('DC&E') costs for single leg open-hole horizontal wells to approximately $750,000 in the fourth quarter of 2015 compared to approximately $1.1 million in the fourth quarter of 2014.
- Increased funds flow from operations by 13% over the third quarter to $16.2 million, despite an 8% decrease in the Company's realized oil and liquids price over the same time period.
- Drilled 11.6 net open-hole wells in the fourth quarter, with a 93% success rate. These wells delivered an average first 30 days of production ('IP 30') of 136 bbls/d, approximately 25% above our internal type well of 109 bbls/d.
- Maintained balance sheet strength, with net debt at the end of the quarter of approximately $86.3 million, or 1.3 times trailing 12 months cash flow.
2015 ANNUAL HIGHLIGHTS
- Increased average production to 8,866 boe/d, representing a per share increase of 24% over 2014. This production growth was delivered organically through the execution of our drilling program on our Saskatchewan focused asset base while spending within cash flow.
- Capital expenditures exclusive of acquisitions were $66.6 million in 2015. Due to cost saving initiatives, drilling efficiencies and the outperformance of our wells, Spartan was able to meet production targets despite reducing capital expenditures by 20% from initially budgeted levels.
- Reduced annual production costs by 11% to $17.23 per boe and net G&A expense by 34% to $1.72 per boe.
- Increased 2P reserves per share by 6% to 42 MMboe (97% oil and liquids) with reserve additions resulting primarily from our 2015 drilling program.
- Achieved record finding and development costs, including changes to future development capital, of $6.76 per boe on a proved basis and $9.80 per boe on a proved plus probable basis.
HIGHLIGHTS SUBSEQUENT TO YEAR END 2015
- On February 24, 2016, Spartan announced a bought deal financing to issue 35,270,000 common shares at a price of $2.41 per common share for gross proceeds of $85 million. The underwriters have an over-allotment option to purchase an additional 4,668,375 common shares at a price of $2.41 per common share any time until 30 days after the closing date. The offering is anticipated to close on March 16, 2016.
- Spartan has recently completed its first quarter drilling program, drilling 10 (8.5 net) open-hole wells and 5 (3.6 net) frac Midale wells in south east Saskatchewan. In west central Saskatchewan, the Company also completed and put on production 6 net Viking wells that were drilled in 2015.
- Spartan drilled the best well in our corporate history in the first quarter of 2016, which was drilled in our greater Winmore area with an IP 30 of 472 bbls/d.
- Continued to deliver cost reductions, with field estimated DC&E costs for our single leg open-hole wells drilled in the quarter averaging approximately $650,000, down over 10% from the fourth quarter.
Spartan intends to continue to take a disciplined approach to capital spending, and we will monitor the commodity price environment and adjust our annual capital expenditures to approximate our annual cash flow. Following completion of the bought deal financing and assuming the underwriters' option is exercised in full, Spartan anticipates being undrawn on its $150 million syndicated credit facility. This financial flexibility leaves Spartan well positioned to take advantage of acquisition opportunities afforded by the currently challenged commodity price environment.
APPOINTMENT OF OFFICER
Spartan is pleased to announce that Mr. Randy Berg has been appointed as the Company's Vice-President, Land. Mr. Berg has served as Land Manager of Spartan since April 2014 and previously served as Vice-President, Land of Renegade Petroleum Ltd. prior to its acquisition by Spartan in March 2014.
Spartan Energy Corp.
People on the Move
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
Join 80,000 oil and gas professionals who receive our weekly newsletter.
You may unsubscribe at any time with one click.