Omega Hydrocarbons Ltd. announces operating and financial results for the six months ended June 30, 1995.CALGARY Calgary (kăl`gərē), city (1991 pop. 710,677), S Alta., Canada, at the confluence of the Bow and Elbow rivers. The largest city in Alberta and the fastest-growing major city in Canada, Calgary is a corporate, transportation, and financial , Alberta--(BUSINESS WIRE)--Aug. 29, 1995--OMEGA HYDROCARBONS hydrocarbons (hīˈ·drō·kärˑ·b  nz),n. LTD LTD 1 Laron-type dwarfism 2 Leukotriene D 3 Long-term depression, see there 4. Long-term disability (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :OMH OMH Office of Mental Health OMH Office of Minority Health OMH Orange County (airport code, VA) OMH Office Municipal d'Habitation OMH On My Honor OMH Oatmeal Milk and Honey (soap) OMH Ohhh... My Head.. ) Omega Hydrocarbons Ltd. today announced its operating and financial results for the six months year ended June 30, 1995. A combination of increased revenues and cost reductions resulted in cash flow increasing nine percent as compared to the first half of 1994. Capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. in the first six months was 74 percent higher than the comparable period of 1994 and a total of 30 wells were drilled in the six month period with an overall success rate of 90 percent. -0-
HIGHLIGHTS
For the Six Months
Ended June 30,
1995 1994 Percent Change
Gross Production Revenue 11,547 10,985 5 Cash Flow From Operations 3,934 3,621 9 Per Share 0.28 0.26 8 Net Earnings 198 212 (7) Per Share 0.01 0.02 Capital Expenditures 5,641 3,245 74 Long Term Debt 19,232 21,733 (12) EXPLORATION AND DEVELOPMENT PROGRAM The second quarter is traditionally a slower quarter for drilling with nine (3.9 net) participation wells and five farmout wells drilled during the quarter. Overall capital expenditures totalled $5.6 million for the first half of 1995. Second quarter activity enjoyed a 93 percent overall success ratio with four (1.4 net) oil wells, two (0.5 net) gas wells, two (1.0 net) service wells and one well being abandoned. The farmout wells, drilled by industry participants on Company lands at not cost to Omega, resulted in one oil well and four gas wells. Omega continues to be very active on the Siksika Indian Nation lands where over 70 percent of this years capital budget is allocated. In late 1994, Omega discovered a Glauconite glau·co·nite n. A greenish mineral of the mica group, a hydrous silicate of potassium, iron, aluminum, or magnesium, (K,Na)(Al,Fe,Mg)2(Al,Si)4O10(OH)2 oil pool in the Bassano area on the east side of the Siksika Indian Nation lands. Omega has now identified the northern extent of this pool and has drilled a water injection well prior to the installation of a waterflood. This pool now contains nine oil wells, one of which will be converted to a water injection well for the south end of the pool. A water source well was drilled and the commencement of waterflood is scheduled for early in the fourth quarter. Omega has a 43 percent interest and operates this 34 degree A.P.I. oil pool which should commence production at 1,000 bopd under waterflood. Recoverable oil reserves Oil reserves refer to portions of oil in place that are claimed to be recoverable under economic constraints. Oil in the ground is not a "reserve" unless it is claimed to be economically recoverable, since as the oil is extracted, the cost of recovery increases incrementally , under waterflood, total 1.6 million barrels from this one pool. 3-D Seismic has identified several other exploration projects to be drilled in the next four months in this area. The Company's technical staff identified and tested a new Glauconite oil pool at Jumpbush during the quarter. The initial discovery well and one follow-up follow-up, n the process of monitoring the progress of a patient after a period of active treatment. follow-up subsequent. follow-up plan oil well were drilled in June and placed on production in the third quarter at rates in excess of 150 bopd per well. An additional well was drilled in June and encountered the gas cap of the pool. Omega's share in this pool totals 20 percent. An exploratory well on another feature, identified by 3-D seismic, in the same section encountered a Viking zone gas well in which Omega maintains a 50 percent working interest. This well was cased and is presently being evaluated for tie-in to existing gas processing facilities in this area. For the remainder of the year, most activity will be in the Namaka/Stobbart area on the west side of the Siksika Indian Nation lands. A 3-D seismic program was conducted over Omega lands on the northern portion of Namaka/Stobbart. The results, to date, have been three Viking gas wells and, more importantly, a new pool Glauconite oil discovery. Due to technical concerns on data quality, Omega farmed out this area on very favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. terms and will collect royalty income until the wells payout pay·out n. 1. The act or an instance of paying out. 2. A percentage of corporate earnings that is paid as dividends to shareholders. and thereafter revert re·vert v. 1. To return to a former condition, practice, subject, or belief. 2. To undergo genetic reversion. to a 16.7 percent working interest. This new pool discovery is being offset by a 3-D program to be completed after approvals are obtained. Further drilling is anticipated on these 33 percent interest lands after seismic interpretation. On the southern portion of Namaka/Stobbart, Omega participated in the drilling of another new pool Glauconite oil discovery on 33 percent working lands. Offset locations are presently being evaluated. With a new pool discovery both north and south of the area where 3-D seismic survey activities will be undertaken, Omega is very encouraged with the prospects for this area. In addition to oil potential on the west side of the Siksika Indian Nation lands, this side also contains large amounts of existing, proven, shut-in shut-in n. A person confined indoors by illness or disability. adj. 1. Confined to a home or hospital, as by illness. 2. Disposed to avoid social contact; excessively withdrawn or introverted. gas. Together with the Viking gas wells discovered to the north and the high level of current drilling, additional gas production will be placed on stream in 1996. PRODUCTION AND PRICES Production of natural gas averaged 9.3 mmcf/d in the second quarter and 8.9 mmcf/d for the first half of 1995. This level is 14 percent higher than the first half of the previous year. Crude oil production during the quarter was 2,253 bopd and 2,205 bopd for the six month period. This level is down ten percent from the comparable first half of 1994 when the Worsley property, which was sold to improve financial leverage, comprised 22 percent of the crude oil production base. If Worsley production is excluded in 1994, the crude oil production actually increased by 15 percent. The price of crude oil was very strong, averaging $24.03 per barrel to Omega in the second quarter. The overall price for the first half was $23.45 per barrel which was 27 percent higher than 1994. Current prices have weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. and will likely remain lower than the current
average for the remainder of the year. Prices for natural gas are
steady over the quarters, averaging $1.36 per mcf for the first half.
These prices are substantially below the $2.10 received in 1994.
Natural gas prices are expected to remain low for the remainder of the
year and even with the majority of Omega's production sold under
long term contracts (primarily Progas), prices are not expected to
increase appreciably ap·pre·cia·ble adj. Possible to estimate, measure, or perceive: appreciable changes in temperature. See Synonyms at perceptible. . The gas price for the next winter season is dependent on weather but stronger prices will return as the lack of gas drilling starts to affect supply. FINANCIAL RESULTS Revenues for the first half of 1994 totalled $11.5 million, up five percent from $11.0 million in 1994. This increased revenue combined with on-going cost controls, that lowered overall expenses by eight percent, resulted in cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses of $3.9 million ($0.28 per share), an increase of nine percent from $3.6 million ($0.26 per share) recorded in the first half of 1994. Earnings totalled $198,000, compared to 1994 results of $212,000. Omega's focus is on full-cycle exploration and development from its own internally generated exploration prospects and high working interest, undeveloped land base. The Company's production base is concentrated in select areas in southern and northern Alberta Norhern Alberta is a region located in the Canadian province of Alberta. Its primary industry is oil and gas, with large heavy oil reserves being exploited at the Athabasca Oil Sands and Wabasca Area in the east of the region. and southwest Manitoba. CONTACT: Dennis E. Hall or Robert A. Maitland, 403/294-7200 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion