Yoho Resources (TSX VENTURE:YO) has filed today on SEDAR the financial statements for the three months ended December 31, 2011 and the related managements' discussion and analysis.
- Yoho's production during fiscal Q1 2012 averaged 2,322 boe per day, a seven percent decrease from Q1 2011 production of 2,505 boe per day. With recent drilling success, Yoho has approximately 1,000 boe per day of production scheduled to come on-stream starting in March 2012.
- Notwithstanding decreased natural gas prices, Yoho generated funds from operations for fiscal Q1 2012 of $3.7 million ($0.09 per share basic and diluted), an increase of 5% from $3.6 million during Q1 fiscal 2011.
- Net exploration and development expenditures for Q1 fiscal 2012 were $12.3 million. During the first quarter, Yoho drilled 4 (1.8 net) gas wells with an overall success rate of 100%.
- The Company maintained a flexible balance sheet with total net debt of $27.2 million at December 31, 2011. The bank credit facility was increased during the quarter to $52 million from $40 million.
- Yoho closed equity issues in December 2011 for total gross proceeds of $5 million (1,250,000 flow-through shares at $4.00 per share) and closed equity issues in January and February 2012 for total gross proceeds of $17.2 million (5,227,325 shares at $3.30 per share).
Nig, British Columbia
In December, 2011 Yoho operated the drilling and completion of the Company's first horizontal well (50% working interest) at Nig targeting the Lower Montney formation. This formation had not been tested in this area to date. This well at c-29-A/94-H-4 was drilled to a total measured depth of 2,830 metres with a horizontal lateral section of 900 metres in length within the Lower Montney formation. In February 2012 the well was fracture stimulated in 6 stages with approximately 900 tonnes of sand and 33,000 barrels of slick water used. During an abbreviated production test, the well flowed up tubing at rates averaging 1.0 MMcf per day and 75 barrels per day of condensate (75 barrels per MMcf). Although the gas rates are lower that other Montney tests in the area, Yoho is encouraged by the high liquids ratio in C-29-A. Yoho expects to significantly increase productivity on further Lower Montney wells through by optimizing both frac size and frac fluid technology. There have been no reserves booked to date by Yoho for the Lower Montney formation.
Yoho is proceeding with its fiscal 2012 operations in the Duvernay at Kaybob with one well currently drilling. The Company is also continuing to exchange data with other operators in the area on a number of recently licensed and drilled Duvernay wells.
Fiscal 2012 will be a year of delineation of the two unconventional plays at Kaybob and Nig. Yoho is currently planning a capital program for fiscal 2012 of between $35 and $40 million. Production for fiscal 2012 is budgeted to average approximately 3,000 boe per day with exit production of between 3,300 and 3,400 boe per day. The fiscal 2012 capital program is expected to generate funds from operations of $15 to $16 million based on a natural gas price of $2.75 per GJ at AECO and an oil price of $90.00 per barrel at Edmonton. With the continued volatility in commodity prices, the activity levels for fiscal 2012 will be monitored to match capital expenditures with expected cash flow and available credit lines.
Yoho Resources Inc. is a Calgary based junior oil and natural gas company with operations focusing in west central Alberta, the Peace River Arch of Alberta and northeast British Columbia. The common shares of Yoho are listed on the TSX Venture Exchange under the symbol "YO".
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