/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR
DISSEMINATION IN THE U.S./
CALGARY,
Nov. 29, 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 and nine months ended September 30, 2013. These may be accessed through
the SEDAR website www.sedar.com under the Company's profile and at
the Company's website www.novusenergy.ca.
FINANCIAL HIGHLIGHTS
- Production revenue for the three months ended September 30, 2013 increased 68% to $32.43 million from $19.35
million recorded in the comparative period of 2012. For the
nine months ended September 30, 2013,
production revenue increased 53% to $83.37
million from $54.63 million
recorded in the comparative period of 2012.
- Funds flow from operations for the three months ended
September 30, 2013 increased 79% to
$19.40 million from $10.84 million recorded in the comparative period
of 2012. For the nine months ended September 30, 2013 funds flow from operations
increased 61% to $48.40 million from
$30.08 million recorded in the
comparative period of 2012.
- Net income for the three months ended September 30, 2013 increased 332% to $7.43 million from $1.72
million recorded in the comparative period of 2012.
For the nine months ended September 30,
2013 net income increased 188% to $16.30 million from $5.65
million recorded in the comparative period of 2012.
- Net capital expenditures for the three months ended
September 30, 2013 were $25.76 million versus $22.95 million recorded in the comparative period
of 2012. For the nine months ended September 30, 2013, net capital expenditures were
$50.45 million versus $58.16 million recorded in the comparative period
of 2012.
- As at September 30, 2013, the
Company had net debt (excluding the fair value of commodity
contracts) of $81.28 million.
- As at September 30, 2013, the
Company's net debt to annualized third quarter 2013 funds flow
ratio was 1.0x.
- Subsequent to quarter end, the Company's revolving operating
demand loan facility was expanded from $95
million to $105 million.
- As at September 30, 2013, the
Company had estimated tax pools of $270.81
million.
- Operating netbacks for the three months ended September 30, 2013 increased 35% to $61.90/boe from $45.87/boe recorded in the comparative period of
2012. For the nine months ended September 30, 2013, operating netbacks increased
19% to $55.17/boe from $46.40/boe recorded in the comparative period of
2012.
A summary of financial results for the three and
nine month periods ended September 30,
2013, along with the comparative periods, are outlined in
the following table:
|
|
Three months ended
Sep 30 |
|
Nine months ended Sep
30 |
|
|
2013 |
|
2012 |
|
% Change |
|
2013 |
|
2012 |
|
% Change |
Financial
($000s, except per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
32,433 |
|
19,351 |
|
68 |
|
83,367 |
|
54,630 |
|
53 |
Funds flow from operations |
|
19,399 |
|
10,839 |
|
79 |
|
48,397 |
|
30,082 |
|
61 |
|
per share - basic |
|
0.10 |
|
0.06 |
|
67 |
|
0.26 |
|
0.16 |
|
63 |
|
per share - diluted |
|
0.10 |
|
0.06 |
|
67 |
|
0.25 |
|
0.16 |
|
56 |
Net income |
|
7,431 |
|
1,720 |
|
332 |
|
16,304 |
|
5,654 |
|
188 |
|
per share - basic |
|
0.04 |
|
0.01 |
|
300 |
|
0.09 |
|
0.03 |
|
200 |
|
per share - diluted |
|
0.04 |
|
0.01 |
|
300 |
|
0.08 |
|
0.03 |
|
167 |
Capital expenditures, net |
|
25,757 |
|
22,950 |
|
12 |
|
50,446 |
|
58,160 |
|
(13) |
Net debt (excluding the fair value
of
financial instruments) |
|
81,281 |
|
61,195 |
|
33 |
|
81,281 |
|
61,195 |
|
33 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
basic |
|
189,375 |
|
189,800 |
|
- |
|
189,375 |
|
185,986 |
|
2 |
|
diluted |
|
194,429 |
|
191,464 |
|
2 |
|
194,096 |
|
189,843 |
|
2 |
OPERATIONAL HIGHLIGHTS
- Average daily production for the three months ended
September 30, 2013 increased 28% to
4,051 boe/d (83% oil & liquids) from 3,154 boe/d (77% oil &
liquids) recorded in the comparative period of 2012. For the
nine months ended September 30, 2013
average daily production increased 32% to 3,863 boe/d (82% oil
& liquids) from 2,929 boe/d (77% oil & liquids) recorded in
the comparative period of 2012.
- Average daily oil and liquids production for the three months
ended September 30, 2013 increased
38% to 3,372 bbls/d from 2,439 bbls/d recorded in the comparative
period of 2012. For the nine months ended September 30, 2013 average daily oil and liquids
production increased 40% to 3,163 bbls/d from 2,266 bbls/d recorded
in the comparative period of 2012.
- The Company's operating costs for the three months ended
September 30, 2013 increased 7% to
$10.66/boe from $9.95/boe recorded in the comparative period of
2012. For the nine months ended September 30, 2013, the Company's operating costs
decreased 1% to $10.38/boe from
$10.49/boe recorded in the
comparative period of 2012.
- During the third quarter of 2013 Novus drilled 31 wells (31.0
net), all of which were Viking horizontal oil wells in the greater
Dodsland area. Thirty-three
wells (33.0 net) were completed. For the first nine months of
2013 Novus drilled 56 wells (56.0 net), all of which were Viking
horizontal oil wells in the greater Dodsland area. Fifty-three wells (53.0
net) were completed.
A summary of operational results for the three
and nine month periods ended September 30,
2013, along with the comparative periods, are outlined in
the following table:
|
|
Three months ended Sep 30 |
|
Nine months ended Sep 30 |
Operational |
|
2013 |
|
2012 |
|
% Change |
|
2013 |
|
2012 |
|
% Change |
|
Production |
|
|
|
|
|
|
|
|
|
|
|
|
Oil & liquids (bbls/d) |
|
3,372 |
|
2,439 |
|
38 |
|
3,163 |
|
2,266 |
|
40 |
Gas (mcf/d) |
|
4,075 |
|
4,287 |
|
(5) |
|
4,198 |
|
3,980 |
|
5 |
Oil equivalent (boe/d) |
|
4,051 |
|
3,154 |
|
28 |
|
3,863 |
|
2,929 |
|
32 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales price per unit |
|
|
|
|
|
|
|
|
|
|
|
|
Oil & liquids ($/bbl) |
|
101.17 |
|
81.75 |
|
24 |
|
92.00 |
|
83.89 |
|
10 |
Gas ($/mcf) |
|
2.79 |
|
2.55 |
|
9 |
|
3.42 |
|
2.34 |
|
46 |
Oil equivalent ($/boe) |
|
87.01 |
|
66.70 |
|
30 |
|
79.06 |
|
68.06 |
|
16 |
Novus' condensed interim financial statements as
at and for the three and nine months ended September 30, 2013 and associated MD&A can be
found on the Company's website at www.novusenergy.ca and under the
Company's profile on SEDAR at www.sedar.com.
OPERATIONAL UPDATE
During the third quarter of 2013, Novus drilled
31 wells (31.0 net), all of which were Viking horizontal oil wells
in the greater Dodsland
area. Thirty-three wells (33.0 net) were completed. For
the first nine months of 2013, Novus drilled a total of 56 wells
(56.0 net), all of which were Viking horizontal oil wells in the
greater Dodsland area.
Fifty-three wells (53.0 net) were completed. A total of 21
more wells are planned to be drilled, and 19 wells are scheduled to
be completed during the fourth quarter.
The Company continues to reduce its well
costs. Third quarter 2013 on-stream costs were less than
$810 thousand per well.
VALUE OPTIMIZATION PROCESS
On September 3,
2013, Novus entered into an arrangement agreement (the
"Arrangement Agreement") with Yanchang Petroleum International
Limited ("Yanchang Petroleum International") and Yanchang
International (Canada) Limited ("Yanchang Canada"), pursuant to
which Yanchang Petroleum International agreed to purchase, through
Yanchang Canada, all of the issued
and outstanding common shares of Novus at a price of $1.18 per common share pursuant to a plan of
arrangement under the Business Corporations Act
(Alberta) (the "Arrangement").
The Arrangement was approved by the shareholders
of Novus at the annual and special meeting held on November 15, 2013. The Arrangement also received
approval from the Court of Queen's Bench of Alberta on the same date. All requisite
approvals from governmental entities in the People's Republic of China have also been
obtained.
Completion of the Arrangement remains subject to
certain approvals set forth in the Arrangement Agreement, including
approval of a simple majority of votes cast by shareholders of
Yanchang Petroleum International at a meeting that will be called
to, among other things, consider the Arrangement, which is expected
to be held in December, 2013. In addition, the Arrangement is
conditional upon Yanchang Petroleum International finalizing
financing arrangements.
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 taking production revenue and
deducting royalties, field operations, transportation and marketing
expenses and realized losses (gains) on financial instruments.
The Company monitors net debt as part of its
capital structure. Net debt is calculated as current assets
less current liabilities, but excluding the fair value of financial
instruments.
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. Boe's may be misleading, particularly if used in
isolation. 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. Given that
the value ratio based on the current price of oil as compared to
natural gas is significantly different from the energy equivalent
of 6:1, utilizing a value conversion of 6:1 may be
misleading. 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 a
targeted acquisition and consolidation strategy coupled with
development and exploration drilling.
Novus' common shares trade on the TSX Venture
Exchange under the symbol NVS. Novus currently has approximately
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. In
particular, but without limiting the foregoing, this press release
contains forward-looking statements pertaining to the following:
expected production volumes; future drilling programs; the results
from our drilling program and the timing of related production;
operating costs; capital spending levels and its impact on our
production levels; and the proposed Arrangement.
Forward-looking statements involve known and
unknown risks and uncertainties which include, but are not limited
to: 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; government regulation and taxation; and failure by the
Company to complete the Arrangement at all or on terms and within a
timeframe acceptable to the Company.
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.