WX Wrangler West Energy Corp

CALGARY, Aug. 24, 2011 /CNW/ -- CALGARY, Aug. 24, 2011 /CNW/ - Wrangler West Energy Corp. ("Wrangler West" or the "Company") (TSXV "WX") announces today's filing on SEDAR (www.sedar.com) of the Company's unaudited Financial Statements and related Management's Discussion and Analysis ("MD&A") for the three and six months ended June 30, 2011 with comparative data for the three and six months ended June 30, 2010 and the year ended December 31, 2010.( )Effective January 1, 2011, Wrangler West has prepared interim financial statements and comparative information according to International Financial Reporting Standards. Previously, the Company prepared financial statements according to Canadian generally accepted accounting principles. All documents may be viewed at www.sedar.com. HIGHLIGHTS Three months ended June 30 Six months ended June 30 2011 2010 % Change 2011 2010 % Change OPERATIONAL HIGHLIGHTS Production Crude oil and NGL 238 297 (20) 243 299 (19) (bbls/d) Natural gas (mcf/d) 4,308 3,337 29 4,505 3,657 23 Total (boe/d) 956 853 12 994 909 9 Prices Crude oil and NGL 92.47 68.96 34 85.34 71.59 19 ($/bbl) Natural gas ($/mcf) 3.98 4.18 (5) 3.95 5.02 (21) Per boe ($) Petroleum and 40.96 40.36 1 38.74 43.76 (11) natural gas revenue Royalties (6.95) (8.86) (22) (6.14) (8.03) (24) Operating expenses (14.26) (15.77) (10) (14.84) (14.56) 2 Field netback 19.75 15.73 26 17.76 21.17 (16) General and (3.85) (3.59) 7 (3.57) (3.40) 5 administrative Interest (0.78) (0.78) - (0.70) (0.96) (27) Funds flow from 15.12 11.36 33 13.49 16.81 (20) operations Share-based - (1.00) (100) - (0.85) (100) payments Depletion, depreciation, and (13.11) (17.11) (23) (14.65) (15.52) (6) amortization Loss on sale of (11.98) (0.13) 9,115 (5.79) (0.13) 4,354 assets Accretion (0.22) (0.23) (4) (0.21) (0.24) (13) Deferred income tax 2.58 0.83 211 1.81 (0.80) (326) benefit (expense) Net loss (7.61) (6.28) 21 (5.35) (0.73) 633 FINANCIAL HIGHLIGHTS ($ thousand) Petroleum and 3,564 3,133 14 6,966 7,199 (3) natural gas revenue Royalties (605) (688) (12) (1,105) (1,321) (16) Operating expenses (1,240) (1,224) 1 (2,668) (2,394) 11 General and (335) (279) 20 (642) (559) 15 administrative Interest (67) (60) 12 (126) (159) (21) Funds flow from 1,317 882 49 2,425 2,766 (12) operations Share-based - (78) (100) - (139) (100) payments Depletion, depreciation, and (1,141) (1,329) (14) (2,634) (2,554) 3 amortization Loss on sale of (1,042) (10) 10,320 (1,040) (21) 4,852 assets Accretion (20) (18) 11 (37) (39) (5) Deferred income tax 225 64 252 325 (132) (346) benefit (expense) Net loss (661) (489) 35 (961) (119) 708 Funds flow from operations - basic 0.20 0.14 43 0.38 0.43 (12) ($/share) Funds flow from operations - 0.20 0.13 54 0.37 0.42 (12) diluted ($/share) Net loss - basic and diluted (0.10) (0.08) 25 (0.15) (0.02) 650 ($/share) Total assets ($ 26,982 34,755 (22) thousand) Wrangler West converts petroleum and natural gas reserves and volumes to a common unit of measure on a basis of six thousand cubic feet ("mcf") of natural gas equals one barrel ("bbl") of oil. Disclosure using barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. The basis for the boe conversion ratio of 6 mcf equals one bbl is an energy equivalency conversion method, primarily applicable at the burner tip. This conversion rate does not represent a value equivalency at the wellhead. The Company calculates boe per day based on total production for the period divided by the number of days during the period. Wrangler West Energy Corp. ("Wrangler West" or the "Company") presents operating and financial results for 2011 second quarter and first six months.  Wrangler West is a Canadian junior oil and natural gas exploration company focused on generating shareholder value by exploring for, developing and producing natural gas and crude oil from properties located in the Province of Alberta. 2011 Six Month Highlights -- $6.97 million in revenue -- $2.43 million in funds flow from operations -- $1.68 million in capital expenditures -- $4.93 million sale of Grand Forks oil pool Review of 2011 Six Months For the six months ended June 30, 2011, Wrangler West produced 994 boe per day, higher by nine percent when compared to the same period one year ago.  However, the Company's field netback fell significantly as Wrangler West experienced a 21 percent decrease in the natural gas price received.  A 19 percent increase in crude oil price somewhat offset the impact of the lower natural gas price.  Operating costs increased 11 percent overall, generally in line with our growth in production.  Funds flow from operations, at $2.43 million, declined 12 percent year-over-year due to lower commodity prices and higher costs.  However, Wrangler West experienced a 19 percent improvement in funds flow for 2011 second quarter, compared to 2011 first quarter. Capital Expenditures Wrangler West invested $1.68 million in capital expenditures during the first six months of 2011.  The Company's capital was directed toward the development of oil-prone exploration and development opportunities.  The capital invested during the six months was primarily allocated to the acquisition of land and seismic to define new and existing prospects.  We expect to continue to build an inventory of quality, seismically-defined drilling prospects throughout 2011 and, on completion of this exploratory work, intend to commence drilling and testing our plays to confirm their commercial viability. At June 30, Wrangler West's 2011 capital expenditures budget of $8.0 million was approximately 20 percent deployed.  An extremely wet summer following a prolonged spring break-up has prevented Wrangler West from undertaking our usual summer drilling program.  Standing water on our drill-ready prospects will push much of Wrangler West's exploration activity into the last half of 2011. Commodity Prices For 2011, Wrangler West's natural gas price has averaged almost $4.00 per mcf.  During the first six months of 2011, natural gas prices continued to disappoint producers and their shareholders.  Natural gas injection into storage is above the five year average and consumption is lagging supply.  The current AECO spot natural gas price is hovering under $3.50 per mcf.  We expect weak prices will continue until the arrival of the 2011-2012 winter heating season.  Fundamentally, there is little margin for producers in $4.00 per mcf natural gas. The United States industrial market and a more stable economy is critical to a healthier natural gas market.  An improvement in the economic outlook south of the 49th parallel would likely foreshadow a rather quick recovery in the North American natural gas price.  Efforts to establish new infrastructure to ship natural gas outside of North America, if successful, should open up new markets for natural gas.  The timing to accomplish this potentially positive initiative to create additional demand for natural gas is yet to be defined. Crude oil price continues to be reasonably strong despite the recent weakness resulting from the United States debt ceiling negotiations and the pending European bank restructuring.  During this period of global uncertainty, oil prices have retreated. In volatile markets, even a junior producer must factor world events into day-to-day management of producing assets.  During 2011 second quarter, a period of strong oil prices, Wrangler West solicited bids to maximize the value of the Grand Forks oil property which culminated in the sale of this asset for $4.9 million.  On completion of the sale, the proceeds were applied to bank indebtedness which leaves the Company with a significantly stronger balance sheet.  Over the next few months, we will focus on drilling our prospects with the intention of replacing the production sold at Grand Forks. Outlook for 2011 Wrangler West is working daily to build a solid inventory of drillable oil-prone targets to fuel future growth.  However, as global economies restructure, managing and building a small conventional producer in this unpredictable business climate is challenging.  The Company has a strong balance sheet and the positive cash flow to act on opportunities.  We have a significant portion of capital remaining in our 2011 budget of $8.0 million.  During the last half of 2011, we expect to deploy capital to exploration prospects that meet Wrangler West's risk/reward criteria.              ________________________________________ WRANGLER WEST ENERGY CORP. STATEMENTS OF FINANCIAL POSITION (Stated in thousands of dollars) (Unaudited) June 30, December 31, 2011 2010 Assets Current assets Accounts receivable $ 1,152 $ 1,406 Income tax receivable - 74 Prepaid expenses 144 144 1,296 1,624 Property, plant and equipment 25,686 33,335 $ 26,982 $ 34,959 Liabilities and shareholders' equity Current liabilities Bank indebtedness $ 1,996 $ 6,354 Accounts payable and accrued liabilities 1,583 3,260 3,579 9,614 Decommissioning obligations 2,050 2,705 Deferred income tax 3,077 3,403 8,706 15,722 Shareholders' equity Share capital 12,402 12,402 Contributed surplus 4,538 4,538 Retained earnings 1,336 2,297 18,276 19,237 $ 26,982 $ 34,959   WRANGLER WEST ENERGY CORP. STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Stated in thousands of dollars, except per share amounts) (Unaudited) Three months ended Six months ended June 30 June 30 2011 2010 2011 2010 Revenue Petroleum and natural $ 3,564 $ 3,133 $ 6,966 $ 7,199 gas sales Royalties (605) (688) (1,105) (1,321) 2,959 2,445 5,861 5,878 Expenses Operating 1,240 1,224 2,668 2,394 General and 335 279 642 559 administrative Share-based payments - 78 - 139 Depletion, depreciation 1,141 1,329 2,634 2,554 and amortization Loss on sale of assets 1,042 10 1,040 21 Results from operating (799) (475) (1,123) 211 activities Finance Interest and accretion 87 78 163 198 Earnings (loss) before (886) (553) (1,286) 13 income tax Deferred income tax (225) (64) (325) 132 expense (benefit) Net loss and $ (661) $ (489) $ (961) $ (119) comprehensive loss Net loss per share Basic and diluted $ (0.10) $ (0.08) $ (0.15) $ (0.02)   WRANGLER WEST ENERGY CORP. STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Stated in thousands of dollars and shares) (Unaudited) Number Total of common Share Contributed Retained shareholders' shares capital surplus earnings equity Balance at January 1, 6,466 $ 12,402 $ 4,538 $ 2,297 $ 19,237 2011 Net loss - - - (961) (961) Balance at 6,466 $ 12,402 $ 4,538 $ 1,336 $ 18,276 June 30, 2011 Balance at January 1, 6,416 $ 12,194 $ 4,313 $ 3,527 $ 20,034 2010 Options 25 112 (55) - 57 exercised Share-based - - 201 - 201 payments Net loss - - - (119) (119) Balance at 6,441 $ 12,306 $ 4,459 $ 3,408 $ 20,173 June 30, 2010   WRANGLER WEST ENERGY CORP. STATEMENTS OF CASH FLOWS (Stated in thousands of dollars) (Unaudited) Six months ended June 30 2011 2010 Cash provided by (used in): Operating Net loss $ (961) $ (119) Items not involving cash: Depletion, depreciation and amortization 2,634 2,554 Accretion 37 39 Share-based payments - 139 Loss on sale of assets 1,040 21 Deferred income tax expense (benefit) (325) 132 2,425 2,766 Change in non-cash operating working 169 (242) capital 2,594 2,524 Financing Increase (decrease) in bank indebtedness, - (2,728) original credit facility Decrease in bank indebtedness, new credit (4,358) - facility Issuance of common shares - 56 (4,358) (2,672) Investing Property, plant and equipment expenditures (1,677) (2,817) Proceeds on sale of assets held for sale 4,959 3,509 Change in non-cash investing working (1,518) (544) capital 1,764 148 Cash and cash equivalents, beginning and end $ - $ - of period Supplementary cash flow information Interest paid 124 208 Income tax paid (received) (74) 6   Reader Advisory This news release contains forward-looking statements ("FLS") about potential new crude oil and natural gas drilling, production operations, sources and use of capital, asset purchases or dispositions and expected future operations. Although Wrangler West believes the expectations reflected in these FLS are reasonable, undue reliance should not be placed on them because the Company can give no assurance the FLS will prove to be correct. Since FLS address future events and conditions, by their very nature they involve inherent risks and uncertainties. A more detailed discussion of FLS is provided in Wrangler West's Management's Discussion and Analysis for the three and six months ended June 30, 2011 which is filed on SEDAR (www.sedar.com).  The FLS contained in this news release are made as of the date hereof and Wrangler West undertakes no obligation to update publicly or revise any FLS or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. Corporate Profile Wrangler West is a Canadian junior crude oil and natural gas producer which explores for and develops crude oil and natural gas production assets in the Province of Alberta. Since inception, the Company's mandate has been to use the drill bit to add shareholder value. Disciplined management of operations and the production portfolio creates sufficient funds flow to support ongoing operations. Wrangler West intends to continue to reinvest funds flow from operations and other available capital to protect current and add future value.  Wrangler West trades on the TSX Venture Exchange under the symbol "WX". Additional Information Wrangler West files additional shareholder and public information on SEDAR accessible at www.sedar.com. This includes the Statement of Reserves Data and Other Oil and Gas Information Form NI 51-101 F1, F2 and F3 effective December 31, 2010.  Alternatively, to obtain copies of published corporate information, contact Crista L. Ferguson, Chief Financial Officer, Wrangler West Energy Corp., 1950, 444 Fifth Avenue SW, Calgary, Alberta, Canada  T2P 2T8 (telephone +1 403 290 6800 or e-mail info@wranglerwest.ca). The TSX Venture Exchange has not reviewed, and does not accept responsibility for, the adequacy or accuracy of this news release.  To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/August2011/24/c6068.html p align="justify" bWrangle/bbr West Energy Corp./bbr/ Steven F. Johnsonbr/ President and Chief Executive Officerbr/ a href="mailto:info@wranglerwest.ca"info@wranglerwest.ca/abr/ telephone:  (403) 290-6800 /p

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