WX Wrangler West Energy Corp

CALGARY, Aug. 23, 2012 /CNW/ - Wrangler West Energy Corp. ("Wrangler West" or the "Company") 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, 2012 with comparative data for the three and six months ended June 30, 2011 and the year ended December 31, 2011.( )All referenced documents may be viewed at www.sedar.com. Three months ended June 30 Six months ended June 30 2012 2011 % Change 2012 2011 % Change OPERATIONAL HIGHLIGHTS Production Crude oil and NGL (bbls/d) 124 238 (48) 130 243 (47) Natural gas (mcf/d) 3,687 4,308 (14) 3,882 4,505 (14) Total production (boe/d) 738 956 (23) 778 994 (22) Prices Crude oil and NGL ($/bbl) 77.30 92.47 (16) 83.15 85.34 (3) Natural gas ($/mcf) 2.02 3.98 (49) 2.14 3.95 (46) Per boe ($) Petroleum and natural gas revenue 23.08 40.96 (44) 24.59 38.74 (37) Royalties 0.03 (6.95) (100) (2.15) (6.14) (65) Operating expenses (12.08) (14.26) (15) (13.07) (14.84) (12) Netback 11.03 19.75 (44) 9.37 17.76 (47) General and administrative (3.50) (3.85) (9) (3.62) (3.57) 1 Interest (0.58) (0.78) (26) (0.51) (0.70) (27) Other income 1.76 - - 0.83 - - Funds flow from operations 8.71 15.12 (42) 6.07 13.49 (55) Share-based payments (0.39) - - (0.36) - - Depletion and depreciation (16.14) (13.11) 23 (16.22) (14.65) 11 Loss on sale of assets - (11.98) (100) - (5.79) (100) Accretion (0.16) (0.22) (27) (0.18) (0.21) (14) Deferred income tax benefit 1.89 2.58 (27) 2.56 1.81 41 Net loss (6.09) (7.61) (20) (8.13) (5.35) 52 FINANCIAL HIGHLIGHTS ($ thousand) Petroleum and natural gas revenue 1,550 3,564 (57) 3,482 6,966 (50) Royalties 2 (605) (100) (305) (1,105) (72) Operating expenses (811) (1,240) (35) (1,851) (2,668) (31) General and administrative (235) (335) (30) (512) (642) (20) Interest (39) (67) (42) (72) (126) (43) Other income 118 - - 118 - - Funds flow from operations 585 1,317 (56) 860 2,425 (65) Share-based payments (26) - - (51) - - Depletion and depreciation (1,084) (1,141) (5) (2,296) (2,634) (13) Loss on sale of assets - (1,042) (100) - (1,040) (100) Accretion (11) (20) (45) (26) (37) (30) Deferred income tax benefit 127 225 (44) 362 325 11 Net loss (409) (661) (38) (1,151) (961) 20 Funds flow from operations - basic and diluted ($/share) 0.09 0.20 (55) 0.13 0.38 (66) Net loss - basic and diluted ($/share) (0.06) (0.10) (40) (0.18) (0.15) 20 Total assets ($ thousand) 26,619 26,982 (1)  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 the three and six months ended June 30, 2012.  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. Six Month Highlights -- $3.5 million of revenue -- $0.9 million of funds flow from operations -- $1.0 million in capital expenditures Review of 2012 First Half For the six months ended June 30, 2012, Wrangler West produced 778 barrels of oil equivalent ("boe") per day, a 22 percent decrease compared to the same period one year ago.  The decrease in production relates to the prior year's asset dispositions as well as expected production declines from the corporate reserves base. Wrangler West is 80 percent-weighted toward natural gas. During the first half of 2012, the Company experienced a ten-year low in the AECO spot price received for natural gas.  In response to this continued deterioration of natural gas prices, we minimized capital expenditures and reduced other expenses wherever possible.  Our year-to-date capital expenditures program has targeted 3D seismic and land acquisitions as well as implementation of the expanded waterflood at Riviere.  After a long spring break-up, continuing wet weather further delayed planned drilling activity. Industry Conditions Difficult market conditions persisted throughout the first half of 2012.  Historically, Canada's oil and natural gas industry has relied on new capital to drive growth in production and assets.  Today, our industry's access to equity is constrained. Within the Western Canada Sedimentary Basin, more than 110,000 boe per day is currently for sale in one form or another.  A few major transactions have commenced and are now in the process of closing.  It would be reasonable to expect reinvestment of the proceeds from these transactions in the public oil and natural gas business.  General consensus among industry participants suggests further significant merger and acquisition activity could occur in the fall of 2012. Natural gas prices appear to have bottomed at the ten-year low reached in April 2012 and natural gas storage volumes are moving toward the historical five-year average.  A hot, dry summer throughout North America, increased electrical power generation switching to natural gas and reduced natural gas drilling all contributed to lower than expected natural gas storage volumes during 2012 second quarter.  However, until withdrawal from storage becomes more predictable, natural gas prices are expected to remain range-bound.  With the approach of the winter heating season, natural gas prices could trend higher by year-end 2012 and into 2013. Strategy for 2012 Second Half Wrangler West is a micro-cap oil and natural gas company.  We must manage through this difficult commodity price cycle which has wiped out most of the profitability of the dry natural gas business.  Wrangler West intends to maintain a conservative approach with regard to capital spending until such time as funds flow strengthens from any sustained increase in natural gas prices.  We are committed to being cash flow positive and to maintaining our conservative approach.  This message of austerity remains consistent with commentary in Wrangler West's first interim report for 2012. These are challenging times for dry natural gas producers like Wrangler West.  We are fortunate to have a creative team guiding the Company through the difficult dynamics of fundamental changes in the conventional junior oil and natural gas sector.  Wrangler West has an inventory of exploration prospects to pursue aggressively providing we achieve drilling success.  Any commodity price improvement or production increase could have a significant impact on per share results. Management is committed to improving Wrangler West's balance sheet.  We are ready to commence a drilling program as part of our strategy to rebuild the Company's asset mix with the objective of increasing the oil weighting in our production base. Economic instability throughout the world has contributed to highly volatile financial markets.  We recognize that many investors have withdrawn from resource-based investments as the current economic uncertainty has eroded profitability and reduced overall liquidity.  In the meantime, we are striving to move the Company forward and to deliver positive results. During the last half of 2012, Wrangler West intends to focus on growth through the drill bit.  We have three 100 percent working interest oil-prone opportunities on 15 sections of land.  With exploration success, a significant development drilling program would take Wrangler West well into the future. ------------------------------ WRANGLER WEST ENERGY CORP. STATEMENTS OF FINANCIAL POSITION (Stated in thousands of dollars) (Unaudited) June 30, 2012 December 31, 2011 Assets Current assets Accounts receivable $ 650 $ 756 Prepaid expenses 192 212 842 968 Property, plant and equipment 25,777 26,995 $ 26,619 $ 27,963 Liabilities and shareholders' equity Current liabilities Bank indebtedness $ 4,177 $ 3,156 Accounts payable and accrued liabilities 988 1,999 5,165 5,155 Decommissioning obligations 2,433 2,369 Deferred income tax 2,442 2,804 10,040 10,328 Shareholders' equity Common shares 12,402 12,402 Contributed surplus 4,835 4,740 Retained earnings (deficit) (658) 493 16,579 17,635 $ 26,619 $ 27,963   WRANGLER WEST ENERGY CORP. STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Stated in thousands of dollars, except per share amounts) (Unaudited)   Three months ended June 30 Six months ended June 30 2012 2011 2012 2011 Revenue Petroleum and natural gas sales $ 1,550 $ 3,564 $ 3,482 $ 6,966 Royalties 2 (605) (305) (1,105) 1,552 2,959 3,177 5,861 Expenses Operating 811 1,240 1,851 2,668 General and administrative 235 335 512 642 Share-based payments 26 - 51 - Depletion and depreciation 1,084 1,141 2,296 2,634 Loss on sale of assets - 1,042 - 1,040 Results from operating activities (604) (799) (1,533) (1,123) Finance Interest and accretion 50 87 98 163 Other income (118) - (118) - Loss before income tax (536) (886) (1,513) (1,286) Deferred income tax benefit (127) (225) (362) (325) Net loss and comprehensive loss $ (409) $ (661) $ (1,151) $ (961) Net loss per share Basic and diluted $ (0.06) $ (0.10) $ (0.18) $ (0.15)   WRANGLER WEST ENERGY CORP. STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Stated in thousands of dollars and shares) (Unaudited) Number of Retained Total common Common Contributed earnings shareholders' shares shares surplus (deficit) equity Balance at January 1, 2012 6,466 $ 12,402 $ 4,740 $ 493 $ 17,635 Share-based payments - - 95 - 95 Net loss - - - (1,151) (1,151) Balance at June 30, 2012 6,466 $ 12,402 $ 4,835 $ (658) $ 16,579 Balance at January 1, 2011 6,466 $ 12,402 $ 4,538 $ 2,297 $ 19,237 Net loss - - - (961) (961) Balance at June 30, 2011 6,466 $ 12,402 $ 4,538 $ 1,336 $ 18,276   WRANGLER WEST ENERGY CORP. STATEMENTS OF CASH FLOWS (Stated in thousands of dollars) (Unaudited)   Three months ended June 30 Six months ended June 30 2012 2011 2012 2011 Cash provided by (used in): Operating Net loss $ (409) $ (661) $ (1,151) $ (961) Items not involving cash: Depletion and depreciation 1,084 1,141 2,296 2,634 Accretion 11 20 26 37 Share-based payments 26 - 51 - Loss on sale of assets - 1,042 - 1,040 Deferred income tax benefit (127) (225) (362) (325) 585 1,317 860 2,425 Change in non-cash operating working capital (545) (10) (318) 169 40 1,307 542 2,594 Financing Increase (decrease) in bank indebtedness 103 (5,120) 1,021 (4,358) Investing Property, plant and equipment expenditures (481) (813) (995) (1,677) Proceeds on sale of assets - 4,933 - 4,959 Change in non-cash investing working capital 338 (307) (568) (1,518) (143) 3,813 (1,563) 1,764 Cash and cash equivalents beginning and end of period $ - $ - $ - $ - Supplementary cash flow information Interest paid (38) (67) (68) (124) Income tax refund - - - 74 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, F3 and F4 effective December 31, 2011.  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). Reader Advisory This news release may contain forward-looking statements ("FLS") related to potential new crude oil and natural gas drilling, tie-ins, 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 the FLS because the Company can give no assurance they 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 year ended December 31, 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 common shares trade on the TSX Venture Exchange under the symbol "WX". Neither the TSX Venture Exchange nor its Regulation Services Provider (as defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release. Wrangler West Energy Corp. CONTACT: Wrangler West Energy Corp.Steven F. JohnsonPresident and Chief Executive Officerinfo@wranglerwest.catelephone: (403) 290-6800

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