Excelsior Energy Limited (TSX VENTURE:ELE) ("Excelsior" or the "Company")
announces it has filed financial statements and management's discussion and
analysis for the three and nine month periods ended September 30, 2009 and 2008.
These materials can be found online at www.sedar.com and on the Company's
website www.excelsior-energy.com.
"During the third quarter the Company achieved a further milestone by filing a
patent application for its combustion overhead gravity drainage proprietary
process." said Dr. David Winter, Excelsior's President and Chief Executive
Officer. "We are now focused on funding the COGD experimental project and the
engagement with CIBC World Markets Inc., to secure a joint venture partner, will
greatly assist in this effort."
Third Quarter 2009 Highlights
-- Excelsior filed a patent application with the Canadian Intellectual
Property Office for its combustion overhead gravity drainage ("COGD")
proprietary process (the "Process"). The Process is designed to prepare
a viscous oil reservoir for exploitation using COGD. The Process uses
cyclic steam and steam flood techniques to predispose the viscous oil
reservoir to form a combustion chamber similar in geometry to the steam
chamber in steam assisted gravity drainage.
-- Excelsior's in situ combustion experimental project application ("COGD
Project Application") to the Alberta Energy Resources Conservation Board
("ERCB") and Alberta Environment ("AENV") has been administratively
accepted and deemed complete and is moving through the approval process.
The COGD Project Application is seeking approval to operate three COGD
well arrays with a production target of up to 1,000 barrels of bitumen
per day. Regulatory approval is on track and approval is anticipated in
approximately nine to twelve months.
-- Excelsior's proprietary COGD technology is supported by a recently
completed computer reservoir simulation model. The work was contracted
to Computer Modeling Group Inc. and used their steam thermal advanced
reservoir simulation (STARS) technology. Excelsior's geological
reservoir characterization model, which integrated all core, log, and
seismic data formed the geological framework for the simulation model. A
number of runs were made to test sensitivities to different reservoir
and operating parameters. The modelling results were positive and
supported Excelsior's pre-ignition process and indicated that a COGD
horizontal well has the potential to produce in excess of 800 barrels of
bitumen per day and attain potential recovery factors in excess of 64%.
-- The Company had working capital of $1.9 million at September 30, 2009,
which is sufficient for general and administrative expenses for the next
four quarters. The Company has no debt. Further operations and
implementation of the COGD experimental pilot project will require
additional funding.
Outlook
-- The Company has commenced a process to find a joint venture partner for
the COGD pilot project. Excelsior engaged CIBC World Markets Inc.
("CIBC") as its strategic advisor to identify and secure a major joint
venture partner for the development of its experimental in situ COGD
pilot project at the Company's Hangingstone property.
-- Excelsior resubmitted an application to the Alberta Government's
Innovative Energy Technology Program ("IETP") in support of the COGD
experimental program. IETP provides for royalty credits to be awarded
for capital spent on new technology. Confirmation is expected by March
31, 2010. The Company cannot guarantee that it will be successful in
securing the IETP funding as it is a competitive process.
-- The Company, through its subsidiary Excelsior Energy North Sea Limited
("EENS"), completed seismic reprocessing and interpretation on licence
P1500 in the UK North Sea. A drilling location has been identified to
test one of the prospects which is a step-out from an existing oil
discovery drilled in 1996. EENS is required to commit to drill on the
block by November 30, 2009, and demonstrate it has the financial
capacity for drilling operations, or relinquish the licence at no
further cost. EENS has requested an extension to February 28, 2009, to
provide additional time to obtain financing for an exploratory well.
EENS is currently conducting a farm-out process to seek an industry
partner for the well.
Selected Information
----------------------------------------------------------------------------
($'s except weighted Three Months Ended Nine Months Ended
average shares) September 30, September 30,
----------------------------------------------------------------------------
2009 2008 2009 2008
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Gas sales 1,937 15,408 12,552 97,520
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Royalties (20) (3,070) (349) (15,531)
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Operating expenses (3,544) (8,159) (12,383) (26,225)
----------------------------------------------------------------------------
Net gas revenue (1,627) 4,179 (180) 55,764
----------------------------------------------------------------------------
Interest income 1,842 51,388 32,326 243,335
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General and
administrative expense 293,074 407,453 829,338 1,111,375
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Net loss and
comprehensive loss (313,029) (666,845) (1,061,559) (2,078,999)
----------------------------------------------------------------------------
Loss per share (basic and
diluted) - (0.01) (0.01) (0.01)
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Capital expenditures
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Petroleum and
natural gas properties 215,547 403,090 8,779,187 11,659,794
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Cash flows
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Cash flows from (used
in) operations (286,781) (396,652) (719,832) (686,336)
----------------------------------------------------------------------------
Cash flows used in
investing (454,013) (601,375) (11,142,390) (12,942,898)
----------------------------------------------------------------------------
Cash flows from
financing - 10,477,701 - 12,589,426
----------------------------------------------------------------------------
Change in cash and
cash equivalents (740,794) 9,479,674 (11,862,222) (1,039,808)
----------------------------------------------------------------------------
Cash and cash
equivalents, beginning
of period 2,626,629 5,329,166 13,748,057 15,848,648
----------------------------------------------------------------------------
Cash and cash
equivalents, end of
period 1,885,835 14,808,840 1,885,835 14,808,840
----------------------------------------------------------------------------
Basic and diluted
weighted average number
of shares outstanding 143,060,590 112,251,793 143,060,590 119,244,452
----------------------------------------------------------------------------
About Excelsior
Excelsior is an early stage, oil sands company with 58 operated sections on two
contiguous blocks in the Hangingstone and West Surmont areas of the Athabasca
Oil Sands Region near Fort McMurray, Alberta. The Company has developed a
proprietary in situ combustion technology ("Combustion Overhead Gravity
Drainage" or "COGD") which has game-changing potential in the development and
recovery of heavy oil and bitumen. An application for an experimental pilot
project to field demonstrate the COGD technology was submitted in at the end of
the second quarter of 2009 with a targeted start up in early 2011. In addition
the Company indirectly holds a 100% working interest in UK North Sea Licences
P1500 and P1691 covering four part-blocks through its 75% owned subsidiary ENS
Energy Ltd. Excelsior's strategy is to capture oil and gas appraisal and
development opportunities where we can leverage Management's diverse
international operating, heavy oil and field development expertise with
developing technologies to produce oil and gas.
Forward Looking Information
This press release contains forward-looking statements and forward-looking
information within the meaning of applicable securities laws. The use of any of
the words "expect", "anticipate", "continue", "estimate", "objective",
"ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and
similar expressions are intended to identify forward-looking statements or
information. More particularly and without limitation, this press release
contains forward-looking statements and information concerning: anticipated
regulatory approvals, anticipated production and recovery results using the
Company's COGD process, the sufficiency of its current funding to meet planned
expenditure requirements, the plans of its subsidiary companies in meeting their
contractual commitments, joint venture opportunities and financing arrangements.
The forward-looking statements and information in this press release are based
on certain key expectations and assumptions made by Excelsior, including
expectations and assumptions concerning: prevailing commodity prices and
exchange rates; applicable royalty rates and tax laws; future drilling results
and production rates; reserve and resource volumes; the success obtained in
drilling new wells; the anticipated production rates and recoverability factors
based on certain modelling results conducted by third parties; the success of
the process conducted by CIBC on terms acceptable to the Company; the
sufficiency of budgeted capital expenditures in carrying out planned activities;
the availability and cost of labour and services; and the receipt, in a timely
manner, of regulatory approvals. Although Excelsior believes that the
expectations and assumptions on which such forward-looking statements and
information are based are reasonable, undue reliance should not be placed on the
forward-looking statements and information because Excelsior can give no
assurance that they will prove to be correct.
Since forward-looking statements and information address future events and
conditions, by their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently anticipated due to a
number of factors and risks. These include, but are not limited to the risks
associated with the oil and gas industry in general such as: operational risks
in development, exploration and production; delays or changes in plans with
respect to exploration or development projects or capital expenditures; the
uncertainty of reserve and resource estimates; the uncertainty of estimates
relating to production, costs and expenses; health, safety and environmental
risks; commodity price and exchange rate fluctuations; marketing and
transportation or petroleum and natural gas and loss of markets; environmental
risks; competition; incorrect assessment of the value of acquisitions; failure
to realize the anticipated benefits of acquisitions; ability to access
sufficient capital from internal and external sources; failure to obtain
required regulatory approvals; inaccuracies in modelling results conducted by
third parties; the ability of the Company to identify and enter into a binding
agreement with a joint venture partner on terms acceptable to the Company; and
changes in legislation, including but not limited to tax laws, royalty rates and
environmental regulations.
Readers are cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could affect the
operations or financial results of Excelsior are included in reports on file
with applicable securities regulatory authorities and may be accessed through
the SEDAR website (www.sedar.com).
The forward-looking statements and information contained in this press release
are made as of the date hereof and Excelsior 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.
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