/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR
DISSEMINATION IN THE U.S./
CALGARY, May 28, 2013 /CNW/ - Novus Energy Inc.
("Novus" or the "Company") (TSXV: NVS) announces that
it has filed its unaudited condensed interim financial statements
and management's discussion and analysis ("MD&A") as at and for
the three months ended March 31,
2013. These documents may be accessed through the SEDAR
website www.sedar.com and at the Company's website
www.novusenergy.ca.
FINANCIAL HIGHLIGHTS
- Production revenue for the three months ended March 31, 2013, was $26.85
million, up 45% from the $18.54
million recorded in the comparative period of 2012.
- Funds flow from operations for the three months ended
March 31, 2013, was $15.91 million, up 49% from the $10.66 million recorded in the comparative period
of 2012.
- Net income for the three months ended March 31, 2013, was $5.08
million, up 79% from the $2.84
million recorded in the comparative period of 2012.
- Net capital expenditures for the three months ended
March 31, 2013, were $19.96 million, up 10% from the $18.13 million recorded in the comparative period
of 2012.
- At March 31, 2013, the Company
had net debt of $83 million against
available lines of credit of $105
million.
- Operating netbacks in the first quarter of 2013 were
$51.17/boe compared to $51.73/boe for the comparative three month period
of 2012.
- Novus continues to maintain significant tax coverage, with
estimated tax pool balances of $273
million at March 31,
2013.
A summary of financial results for the three
month period ended March 31, 2013,
along with the comparative period, are outlined in the following
table:
Financial
(000s, except per share amounts) |
|
Three months ended March 31 |
|
|
2013 |
2012 |
% change |
Revenue |
|
|
$ 26,851 |
$ 18,542 |
45 |
Funds flow from operations |
|
|
15,914 |
10,660 |
49 |
per share - basic and diluted |
|
|
0.08 |
0.06 |
33 |
Net income |
|
|
5,080 |
2,844 |
79 |
per share - basic and diluted |
|
|
0.03 |
0.02 |
50 |
Capital expenditures, net |
|
|
19,961 |
18,134 |
10 |
Net debt |
|
|
83,001 |
39,132 |
112 |
Weighted average shares outstanding
basic |
|
|
189,375 |
177,131 |
7 |
diluted |
|
|
194,708 |
185,021 |
5 |
OPERATIONAL HIGHLIGHTS
- Average daily production for the first quarter of 2013
increased 49% to 4,085 boe/d (comprised of 82% oil and liquids)
from the 2,745 boe/d recorded in the corresponding period in
2012.
- Average crude oil and liquids production for the first quarter
of 2013 increased 52% to 3,340 bbls/d from 2,203 bbls/d in the
comparative quarter. Natural gas production increased 37% to 4,470
mcf/d from 3,254 mcf/d in the comparative quarter.
- The Company drilled 17 Viking horizontal wells (17.0 net) in
the first quarter of 2013. Twenty wells (20.0 net) were
completed and brought on production during the quarter.
- Corporate operating costs continued to decrease, declining to
$9.06/boe for the first quarter of
2013 from $11.66/boe in the first
quarter of 2012.
A summary of operational results for the three
month period ended March 31, 2013,
along with the comparative period, are outlined in the following
table:
|
|
Three months ended March 31 |
Operational |
|
2013 |
2012 |
% change |
Production |
|
|
|
|
Oil & liquids (bbls/d) |
|
3,340 |
2,203 |
52 |
Gas (mcf/d) |
|
4,470 |
3,254 |
37 |
Oil equivalent (boe/d) |
|
4,085 |
2,745 |
49 |
Average realized prices |
|
|
|
|
Oil & liquids ($/bbl) |
|
84.56 |
88.92 |
(5) |
Gas ($/mcf) |
|
3.56 |
2.43 |
47 |
Oil equivalent ($/boe) |
|
73.03 |
74.23 |
(2) |
The full text of the March
31, 2013 condensed interim financial statements and
associated MD&A can be found on the Company's website at
www.novusenergy.ca and on SEDAR at www.sedar.com.
OPERATIONAL UPDATE
During the first quarter of 2013, Novus drilled
17 horizontal Viking wells (17.0 net) and completed and placed on
production 20 wells (20.0 net). During the first quarter, the
Company undertook its second pilot project in the Flaxcombe region to evaluate the concurrent
development of the upper and lower Viking cycles present in the
region. Seven wells alternately targeting the upper and lower
cycle have been drilled into a quarter section of land.
Results from this development project and Novus' initial pilot in
the area are extremely encouraging and point towards an ultimate
development scenario in Flaxcombe
where up to 32 wells may be drilled in one section of land, with 16
wells targeting the upper cycle, and 16 wells targeting the lower
cycle.
Novus has been focused on continually lowering
its drilling and completion costs, employing new completion
techniques to improve the economic performance of its wells, and
building the necessary area infrastructure to support stable, low
operating cost production. Novus' operating costs have
continued to decrease, reaching $9.06/boe in the most recently completed quarter,
down 22% from $11.66/boe in the first
quarter of 2012.
OUTLOOK
After almost three months of drilling inactivity
due to spring break-up, and with recently favorable weather and
rapidly improving field conditions, Novus plans to recommence
drilling operations in early June in the Dodsland region.
The Company continues to undertake innovative
measures such as pad drilling to maintain its low drilling and
completion costs. Long term, the Company expects it will be
able to maintain its cost structure at historically attractive
levels.
With recently completed land transactions, the
Company now has a total of 1,500 net high quality risked Viking oil
drilling locations on its 220 net sections of land in its Viking
light oil resource play.
VALUE OPTIMIZATION PROCESS
On December 4,
2012, Novus announced that it had retained financial
advisors to assist the Special Committee of the Board of Directors
in exploring and evaluating a broad range of options to optimize
shareholder value. Technical presentations commenced during the
third week of January 2013 for
interested and qualified parties who have entered into a
confidentiality agreement with Novus. The Company does not
intend to disclose future developments with respect to the process
unless and until the Board of Directors has approved a specific
transaction or otherwise determines that disclosure is appropriate
or required.
NON-IFRS FINANCIAL MEASUREMENTS
Included in this press release are references to
certain financial measures commonly used in the oil and natural gas
industry, such as funds flow from operations, operating netbacks
and net debt. These measures have no standardized meanings,
are not defined by International Financial Reporting Standards
("IFRS"), and accordingly are referred to as non-IFRS
measures. The determination of these measures may not be
comparable to the same as reported by other companies and should
not be considered an alternative to, or more meaningful than, cash
provided by operating, investing and financing activities or net
income as determined by IFRS as an indicator of the Company's
performance or liquidity.
The Company considers funds flow from operations
to be a key measure as it demonstrates the Company's ability to
generate the cash necessary to repay debt and to fund future growth
through capital investment. Novus determines funds flow from
operations as cash provided by operating activities prior to
changes in non-cash working capital items and decommissioning
expenditures.
Operating netbacks are used by management to
assess operating results between periods and between peer companies
as they provide an indication of results generated by the Company's
principal business activities before the consideration of how these
activities are financed or how the results are taxed. Operating
netbacks are calculated by deducting royalties, field operations
and transportation and marketing expenses from production
revenue.
The Company monitors net debt as part of its
capital structure. Net debt is calculated as current assets
less all current liabilities, including any bank debt.
OTHER MEASUREMENTS
Reported production represents Novus' ownership
share of sales before the deduction of royalties. Where amounts are
expressed on a barrel of oil equivalent ("boe") basis, natural gas
has been converted at a ratio of six thousand cubic feet to one
boe. This ratio is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead. Boe's may be
misleading, particularly if used in isolation. References to
natural gas liquids ("liquids") include condensate, propane, butane
and ethane and one barrel of liquids is considered to be equivalent
to one boe.
Novus Energy Inc. is a well positioned, junior
oil and gas company with a proven management team committed to
aggressive, cost-effective growth of high netback light oil
reserves and production. Novus will continue to grow through
exploratory and development drilling funded through its strong
financial position.
Novus Shares trade on the TSX Venture Exchange
under the symbol NVS. Novus currently has 189.4 million common
shares outstanding.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
This news release will not constitute an
offer to sell or the solicitation of an offer to buy the securities
in any jurisdiction. Such securities have not been registered under
the United States Securities Act
of 1933 and may not be offered or sold in the United States, or to a U.S. person, absent
registration, or an applicable exemption therefrom.
ADVISORY REGARDING FORWARD LOOKING STATEMENTS
Certain disclosures set forth in this press
release constitute forward-looking statements. Any statements
contained herein that are not statements of historical facts may be
deemed to be forward-looking statements. Forward-looking
statements are often, but not always, identified by the use of
words such as "anticipate", "believes", "budget", "continue",
"could", "estimate", "forecast", "intends", "may", "plan",
"predicts", "projects", "should", "will" and other similar
expressions. All estimates and statements that describe the
Company's future, goals, or objectives, including Management's
assessment of future plans and operations, may constitute
forward-looking information under securities laws.
Forward-looking statements involve known and unknown risks and
uncertainties which include, but are not limited to: the failure of
the Company to undertake a sale, farmout or joint venture of all or
a portion of the assets of the Company, a merger or other business
combination of the Company with another entity, a recapitalization
of the Company, a sale of the Company as a whole or any combination
thereof; exploration, development and production risks; assessments
of acquisitions; reserve measurements; availability of drilling
equipment; access restrictions; permits and licenses; aboriginal
claims; title defects; commodity prices; commodity markets;
transportation and marketing of crude oil, liquids and natural gas;
reliance on operators and key personnel; competition; corporate
matters; funding requirements; access to credit and capital
markets; market volatility; cost inflation; foreign exchanges
rates; general economic and industry conditions; environmental
risks; and government regulation and taxation.
Forward-looking statements relate to future
events and/or performance and although considered reasonable by
Novus at the time of preparation, may prove to be incorrect and
actual results may differ materially from those anticipated in the
statements made. Novus does not undertake any obligation to
publicly update forward-looking information except as required by
applicable securities law.
Readers are cautioned that the foregoing list
of factors is not exhaustive. Additional information on these and
other factors that could affect Novus operations or financial
results are included in reports on file with applicable securities
regulatory authorities and may be accessed through the SEDAR
website (www.sedar.com), and at Novus' website
(www.novusenergy.ca). The forward-looking statements and
information contained in this press release are made as of the date
hereof and Novus 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.
SOURCE Novus Energy Inc.