VANCOUVER, May 2, 2017 /CNW/ - Renaissance Oil Corp.
("Renaissance" or the "Company") (TSX-V:ROE) today reported its
fourth quarter and full year 2016 results. All dollar figures are
Canadian dollars unless otherwise noted.
HIGHLIGHTS
- Achieved growth strategy of becoming first independent operator
of oil and gas production in Mexico in 78 years;
- Renaissance commenced production of crude oil and natural gas
on May 10, 2016 and recorded
$13.1 million in revenue for the
year;
- Operating costs declined by 39% in the fourth quarter to
$4.33 per Boe from $7.05 per Boe in the third quarter of 2016;
- Net income of $71,627 in the
fourth quarter compared to a loss of $336,853 in third quarter and a loss $5.5 million in the fourth quarter of 2015;
- Renegotiated commercialization contracts to increase sales
prices of crude oil and natural gas; and
- Submitted and subsequently received approval for appraisal and
development plans for the drilling of new wells and workovers on
existing wells in Chiapas,
Mexico.
|
Three Months
Ended
|
Year
Ended
|
|
Dec 31,
2016
|
Sept 30,
2016
|
Jun 30,
2016
|
2016
|
|
Production
|
|
|
|
|
|
|
|
|
|
Crude Oil
(Bbl/d)
|
|
639
|
|
744
|
|
754
|
|
705
|
|
Condensate
(Bbl/d)
|
|
-
|
|
11
|
|
28
|
|
10
|
|
Natural Gas
(Mcf/d)
|
|
5,869
|
|
5,709
|
|
5,788
|
|
5,789
|
|
Total
(Boe/d)
|
|
1,618
|
|
1,706
|
|
1,747
|
|
1,680
|
|
|
|
|
|
|
|
|
|
|
Prices
|
|
|
|
|
|
|
|
|
|
Crude Oil
($/Bbl)
|
|
50.04
|
|
48.25
|
|
58.91
|
|
51.64
|
|
Condensate
($/Bbl)
|
|
-
|
|
32.60
|
|
29.21
|
|
30.74
|
|
Natural Gas
($/Mcf)
|
|
2.95
|
|
3.28
|
|
3.48
|
|
3.21
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
$
|
4,599,044
|
$
|
5,055,760
|
$
|
3,400,413
|
$
|
13,055,218
|
|
Royalties
|
|
(3,638,647)
|
|
(3,993,824)
|
|
(2,609,355)
|
|
(10,241,826)
|
|
Operating
Costs
|
|
(643,895)
|
|
(1,107,329)
|
|
(628,790)
|
|
(2,380,014)
|
|
Operating Netback
(1)
|
|
316,502
|
|
(45,393)
|
|
162,268
|
|
433,378
|
|
|
|
|
|
|
|
|
|
|
Net Income
(loss)
|
|
71,627
|
|
(336,853)
|
|
(1,287,717)
|
|
(3,401,153)
|
|
Per Share, Basic
& Diluted
|
$
|
0.00
|
$
|
(0.02)
|
$
|
(0.04)
|
$
|
(0.02)
|
|
(1) Non-GAAP
measure
|
|
|
|
|
|
|
|
|
PRESIDENT'S MESSAGE
2016 was an evolutionary year for Renaissance with the Company
achieving strategic milestones. In May
2016, Renaissance entered into licence contracts with the
Comisión Nacional de Hidrocarburos (the "CNH") for the Mundo Nuevo, Topén and Malva blocks, located
in Chiapas, Mexico (the "Chiapas
Blocks"). In August 2016, the
Company acquired a fourth property, Pontón in Veracruz, to become the holder of the most
number of onshore blocks of any independent operator in
Mexico. In August 2016,
Renaissance completed a 90-day transition period with Petróleos
Mexicanos ("PEMEX") and assumed
independent operatorship of the 100% owned Chiapas Blocks becoming
the largest independent producer of crude oil and natural gas in
Mexico.
The Company has subsequently performed multiple production tests
on the producing wells to determine well productivity and has
designed field optimization plans. Renaissance has identified
several opportunities to increase production, reduce field
operating costs and increase operating netbacks. On
April 26, 2017, Renaissance received
approval from the CNH for the Appraisal and Development Plans of
the Chiapas Blocks allowing the Company to initiate its drilling
and workover program. Renaissance expects to drill 3 - 4 new
wells and to workover and repair existing wells on the Chiapas
Blocks in the next 12 months in view of enhancing production.
In November 2016, Renaissance
amended its commercialization contract for crude oil sales with a
new oil pricing formula which has resulted in the Company receiving
higher crude oil sales prices going forward. In February 2017, Renaissance renegotiated its
commercialization contract for natural gas sales which has resulted
in higher prices for the Company's sales gas. Under the new
contract in February and March 2017,
the Company received an average sales price for natural gas of
US$3.78 per Mcf compared to the
average of US$2.23 per Mcf received
in Q4 2016.
In February 2017, the Company
partnered with Lukoil by acquiring a 25% interest in the Integrated
Exploration and Production Contract for the 230 km2
(56,800 acres) Amatitlán block, near Poza Rica Veracruz, Mexico
(the "Amatitlán Contract"). Renaissance is focused on
developing the Upper Jurassic shale and shallower Tertiary
formations present in the Amatitlán block which the Company
believes holds significant resource potential. The Company is
finalizing development plans for the Amatitlán block with PEMEX and
expects to initiate the drilling program in Q3 2017.
Renaissance has taken the lead role in operations and holds options
to increase its interest in the Amatitlán Contract to 62.5%, upon
successful development of the property.
In April 2017, Renaissance
completed an equity financing for gross proceeds of $12.8 million to fund its 2017 drilling and
capital expenditure plans.
Renaissance continues to make progress on its journey to become
a major Mexican energy producer.
For further information, please visit our website at
www.renaissanceoil.com.
RENAISSANCE OIL CORP.
Per:
Craig Steinke
Chief Executive Officer
Abbreviations:
|
bbl or
bbls
|
barrel or
barrels
|
Mcf
|
thousand cubic
feet
|
|
bbls/d
|
barrels per
day
|
Mcf/d
|
thousand cubic feet
per day
|
|
boe
|
barrels of oil
equivalent
|
MMcf
|
million cubic
feet
|
|
boe/d
|
barrels of oil
equivalent per day
|
MMcf/d
|
million cubic feet
per day
|
This news release should be read in conjunction with the
Company's audited consolidated financial statements for the year
ended December 31, 2016 and related
management's discussion and analysis. These filings are available
for review on SEDAR at www.sedar.com.
Cautionary Note Regarding Forward-Looking
Statements
This news release contains certain
"forward-looking statements" within the meaning of Canadian
securities legislation, including, without limitation, statements
with respect to increase production, reduce field operating
costs and increase operating netbacks, future prices received for
crude oil and natural gas, the initiation of and success of the
drilling program at Amatitlán and the Company
becoming a major Mexican energy producer. Forward-looking
statements are statements that are not historical facts which
address events, results, outcomes or developments that the Company
expects to occur; they are generally, but not always, identified by
the words "expects", "plans", "anticipates", "believes", "intends",
"estimates", "projects", "aims", "potential", "goal", "objective",
"prospective", and similar expressions, or that events or
conditions "will", "would", "may", "can", "could" or "should"
occur. Forward-looking statements are based on the beliefs,
estimates and opinions of the Company's management on the date the
statements are made and they involve a number of risks and
uncertainties. Certain material assumptions regarding such
forward-looking statements are discussed in this news release and
the Company's annual and quarterly management's discussion and
analysis filed at www.sedar.com. Except as required by the
securities disclosure laws and regulations applicable to the
Company, the Company undertakes no obligation to update these
forward-looking statements if management's beliefs, estimates or
opinions, or other factors, should change.
Neither the TSXV nor its Regulation Services Provider (as
that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
SOURCE Renaissance Oil Corp.