CALGARY, ALBERTA (TSX: SNG) (AMEX: SNG) is pleased to announce
its financial and operating results for the three months ended
March 31, 2008 ("Q1").
Highlights
- In January 2008, Canadian Superior announced a large natural
gas discovery in Trinidad. Successfully drilled its "Victory" well,
"Intrepid" Block 5(c), offshore Trinidad; a natural gas discovery,
with two zones successfully production tested. The first zone
tested natural gas on a restricted basis at high pressure rates
averaging between 40 and 45 mmcf/d; and, the second zone, which was
tested independently and separate from the first zone, tested
natural gas on a restricted basis at high pressure rates averaging
in excess of 30 mmcf/d;
- On March 26, 2008, Canadian Superior closed the acquisition of
Seeker Petroleum Ltd. for a consideration of $51.2 million. Through
the acquisition Canadian Superior acquired approximately 1,035
BOE/d (72% natural gas, 28% oil & liquids), approximately 2,073
MBOE of proven plus probable reserves and approximately 1,297 MBOE
additional possible reserves, 55,385 net acres of undeveloped land
and 102 sq. km of proprietary 3D seismic;
- On February 20, 2008, Canadian Superior along with its
partners, BG International Limited ("BG"), a wholly owned
subsidiary of the BG Group plc (LSE: BG.L) and Challenger Energy
Corp. ("Challenger") (TSX VENTURE: CHQ)(AMEX: CHQ) successfully
spudded the "Bounty" well on the "Intrepid" Block 5(c), offshore
Trinidad, with the Kan Tan IV semi-submersible drilling rig. The
"Bounty" well is located approximately 2.2 miles from the recently
announced "Victory" well natural gas discovery;
- Average daily production for Q1 2008 was 3,110 boe/d, up 7% or
213 boe/d compared to Q1 2007, with a Q1 2008 exit rate of 4,350
boe/d;
- Drilled 6 gross (5.0 net) wells during the period, resulting
in 3 gross (2.6 net) natural gas and 3 gross (2.4 net) oil wells,
all currently being evaluated;
- Petroleum and natural gas revenues (net of transportation)
were $15.9 million or $56.29/boe in Q1 2008 compared to $12.6
million or $48.31/boe in Q1 2007;
- Cash flow from operations were $9.2 million or $32.49/boe in
Q1 2008 compared to $6.5 million or $24.81/boe in Q1 2007; and
- Net debt at March 31, 2008 was $11.3 million or 0.68:1 on net
debt to twelve month trailing cash flow from operations.
Speaking today, Craig McKenzie, Canadian Superior's Chief
Executive Officer, said "Our corporate objective is to remain
focused on adding shareholder value with high impact offshore
exploration in Trinidad, combined with growing cash flow from
Western Canada. We are pleased to report that in the First Quarter
of 2008 our average daily production, oil and gas revenues and cash
flow from operations have all increased over the same period in
2007. We expect for the remainder of this year will be very
exciting and rewarding for Canadian Superior shareholders."
Financial and Operational Highlights
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March 31 2008 2007 % Change
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Financial
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($000's except per share amounts)
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Petroleum and Natural Gas Sales 15,932 12,598 27%
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Cash Flow from Operations 9,194 6,470 42%
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Per Share 0.07 0.05 40%
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Net loss (1,863) (129) 1,344%
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Per Share (0.01) (0.00) 0%
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Capital Expenditures 11,992 12,319 -3%
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Nova Scotia Off-Shore Deposits 14,559 14,925 -2%
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Net Asset (Debt) (11,319) (7,312) 54%
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Shares Outstanding at period end 148,609 131,960 13%
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Operating
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Average Production
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Natural Gas (mcf/d) 15,123 13,984 8%
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Oil and NGL's (bbls/d) 590 566 4%
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boe/d 3,110 2,897 7%
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Average Selling Price
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Natural Gas ($/mcf) 8.14 7.71 6%
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Oil and NGL's ($/bbl) 88.02 56.81 55%
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Total ($/boe) 56.29 48.32 16%
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Gross Undeveloped Land (Acres)
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Offshore Trinidad and Tobago 135,041 135,041 0%
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Offshore Nova Scotia 1,234,546 1,234,546 0%
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Western Canada 309,040 131,747 135%
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Wells Drilled
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Gross 6.0 8.0 -25%
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Net 5.0 7.1 -30%
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Operational Update
Trinidad and Tobago
In January 2008, Canadian Superior announced a large natural gas
discovery in Trinidad. Successfully drilled its "Victory" well,
"Intrepid" Block 5(c), offshore Trinidad, a natural gas discovery;
with two zones successfully production tested. The first zone
tested natural gas on a restricted basis at high pressure rates
averaging between 40 and 45 mmcf/d; and, the second zone, which was
tested independently and separate from the first zone, tested
natural gas on a restricted basis at high pressure rates averaging
in excess of 30 mmcf/d. The combined two zones could produce
natural gas at estimated rates of over 100 mmcf/d, with the first
zone being condensate rich.
On February 20, 2008, the Company successfully spudded the
"Bounty" well with the Kan Tan IV semi-submersible drilling rig.
The rig had moved approximately 2.2 miles from the "Victory" well.
The "Bounty" well is planned to be drilled to a total vertical
depth of approximately 18,000 feet subsea in about 1,000 feet of
water and is expected to take about 110 days to drill. It is
expected that the "Bounty" well and the third well, "Endeavour"
will both be drilled and evaluated by year end 2008.
On May 7, 2008 the Company reported that the Bounty well was
poised to reach final Total Depth ("TD") of about 18,000 feet in
approximately 30 days. The Company just completed drilled the
12-1/4" hole section in the well to a total depth of 14,415 feet
subsea. The primary objective of the Bounty well is to prove up the
presence of potential multi-TCF reservoirs which are deeper, and
higher pressure then the Victory discovery.
The Company also continues to prepare for the first phase of
operations on its Mayaro/Guayaguayare ("M/G") "Tradewinds" project
with its joint venture partner, the Petroleum Company of Trinidad
and Tobago Limited ("Petrotrin").This joint venture encompasses two
near-shore Blocks (58,080 gross acres) off the east coast of
Trinidad where management hopes to establish significant oil
reserves in the heart of a known producing hydrocarbons-bearing
structural trend. For the M/G Block, the Company is designing a
seismic program to evaluate the near-shore block and is planning
this program to be shot in 2008 or early 2009 where we intend to
drill two offshore wells on the M/G Block prior to year end
2009.
Offshore Nova Scotia, Canada
Canadian Superior is one of the few operators involved in all
three main play types in the offshore Nova Scotia basin where the
Company has evolved as the company holding the largest exploration
acreage position with 100% interests in five exploration licences
totaling 1.23 million net acres at March 31, 2008. Canadian
Superior relinquished EL2412 and EL2413 at the end of 2007 and
currently holds the following exploration licenses "Mayflower"
(EL2406), "Marauder" (EL2415), "Marconi" (EL2416), "Mariner"
(EL2409) and "Marquis" (EL2402) exploration blocks. In addition to
the prospects identified on EL2409, EL2406 and EL2402, Canadian
Superior has identified several large Cretaceous and Jurassic
prospects on its 100% "Marauder" and 100% "Marconi" exploration
lands which cover 370,890 acres offshore Nova Scotia, offsetting
the Sable Island area. The "Marauder" lands directly offsets three
significant discovery licences and have several seismically defined
prospects, two of which lie on trend with significant discoveries
near existing production infrastructure. The "Marconi" licence has
a seismically defined tilted fault / anticlinal prospect similar to
other Sable area fields.
Canadian Superior's "Mariner" shallow water block (EL2409)
covers 100,656 acres and is located approximately nine kilometres
northeast of Sable Island, offshore Nova Scotia and directly
offsets five significant discoveries near Sable Island, including
the ExxonMobil Venture natural gas production field and other
nearby Sable Offshore Energy Project existing production
infrastructure. Two new prospective locations have been identified
and further drilling is planned by Canadian Superior on the
"Mariner" Block in 2009. Front end geological and geophysical
analyses are complete and environmental approvals are in place.
Western Canada
On March 27, 2008, the Company closed the acquisition of Seeker
Petroleum, by acquiring all of the issued and outstanding shares
for total consideration of approximately $51.8 million, including
the assumption of approximately $8.5 million of debt. Canadian
Superior acquired approximately 1,035 boe/d of Western Canadian
production and 2,073 MBOE of proven plus probable reserves,
including 102,000 gross (55,400 net) acres of undeveloped land.
The Company drilled and cased six wells (5.0 net) in the first
quarter of 2008, including three gross (2.6 net) gas and three
gross (2.4 net ) oil wells, along with a seventh well, from the
Seeker assets, which was rig released in April 2008. The Company
has planned two 3D seismic programs for winter 2008 that total 73
square kilometers, along with a third program to evaluate Seeker's
acreage. The Company's comprehensive 2008 drilling plan continues
to be adjusted to rank and prioritize the combined companies
drilling portfolios.
Subsequent to the end of Q1, in April 2008, Canadian Superior
closed the acquisition of Fair Sky Resources assets through a
receivership process, adding over 70,000 acres of additional
undeveloped land to Canadian Superior's holdings.
Canadian Superior is a Calgary, Alberta, Canada based oil and
gas exploration and production company with operations Offshore
Trinidad and Tobago, Offshore Nova Scotia, Canada and in Western
Canada. See Canadian Superior's website at www.cansup.com to review
Canadian Superior's operations in Western Canada, Offshore Trinidad
and Tobago and Offshore Nova Scotia interests. Canadian Superior
has approximately 20,000 shareholders worldwide, including some of
the top institutional shareholders in North America.
Canadian Superior is paying 26-2/3% of the Block 5(c)
exploration program cost to maintain a 45% working interest in
Block 5(c), with its partners, BG International Limited, a wholly
owned subsidiary of the BG Group plc, paying approximately 40% for
a 30% working interest and Challenger Energy Corp. paying 33-1/3%
for a 25% working interest through Canadian Superior.
BG Group plc (LSE: BG.L) is a world leader in natural gas, with
a strategy focused on connecting competitively-priced resources to
specific, high-value markets. Active in 27 countries on five
continents, BG Group has a broad portfolio of exploration and
production, Liquefied Natural Gas (LNG), transmission and
distribution and power generation business interests. It combines a
deep understanding of gas markets with an excellent track record in
finding and commercializing reserves. See www.bg-group.com for
information on BG Group plc.
Challenger Energy Corp. is a Calgary, Alberta, Canada based oil
and gas exploration company which is currently focusing on "high
impact" oil and gas plays offshore Trinidad and Tobago and offshore
Nova Scotia. See www.challenger-energy.com for information on
Challenger.
This news release contains forward-looking information,
including estimates, projections, interpretations, prognoses and
other information that may relate to current, past or future
production, development(s), testing, well test results, project
start-ups and future capital spending. Current, past and/or future
actual results and/or reported results, estimates, projections,
interpretations, prognoses, well results, test results, reserves,
production, resource and/or resource potential, development(s),
project start-ups, and capital spending, plans and/or estimated
results could differ materially due to changes in project
schedules, operating performance, demand for oil and gas,
commercial negotiations or other technical and economic factors or
revisions. This news release may contain the reference to the terms
discovery, reserves and/or resources or resource potential which
are those quantities estimated to be contained in accumulations.
There is no certainty that any portion of these accumulations or
estimated accumulations in this news release may not change
materially; and that, if discovered, in any discovery, the
accumulations or estimated accumulations may not be economically
viable or technically feasible to produce.
Statements contained in this news release relating to estimates,
results, events and expectations are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements involve known and unknown
risks, uncertainties, scheduling, re-scheduling and other factors
which may cause the actual results, performance, estimates,
projections, interpretations, prognoses, schedules or achievements
of the Corporation, or industry results, to be materially different
from any future results, performance or achievements expressed or
implied by such statements. Such factors include, among others,
those described in the Corporations' annual reports on Form 40-F or
Form 20-F on file with the U.S. Securities and Exchange
Commission.
Contacts: Canadian Superior Energy Inc. Investor Relations (403)
294-1411 (403) 216-2374 (FAX) Website: www.cansup.com Canadian
Superior Energy Inc. Suite 2700, 605 - 5th Avenue S.W. Calgary,
Alberta Canada T2P 3H5
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