News: Cub Energy earns $263,000 (U.S.) in Q1 Cub Energy earns $263,000 (U.S.) in Q1
2021-05-26 14:26 MT - News Release
Mr. Patrick McGrath reports
CUB ENERGY ANNOUNCES FIRST QUARTER RESULTS
Cub Energy Inc. has released its unaudited financial and operating results for the three months ended March 31, 2021. All dollar amounts are expressed in U.S. dollars unless otherwise noted. This update includes results from Kub-Gas LLC, which Cub has a 35-per-cent equity ownership interest, Tysagaz LLC, Cub's 100-per-cent-owned subsidiary, and CNG LLC, which Cub has a 50-per-cent equity ownership interest.
Patrick McGrath, interim chief executive officer of Cub, said: "We are pleased to report $709,000 in profit from our gas trading business during the first quarter which resulted in the company reporting net income of $263,000 for the three months ended March 31, 2021. The key driver in the financial performance was the increase in the natural gas price to $5.90 per million cubic feet during the current quarter. We also had operational success with the installation of the two Jenbacher power units and achieved commercial power generation midway through the second quarter of 2021."
Operational highlights
- Achieved average natural gas price of $5.90/Mcf and condensate price of $67.86 per barrel (bbl) during the three months ended March 31, 2021, as compared with $3.45/Mcf and $36.251/bbl for the comparative 2020 period. The increase is due, in large part, to a colder European winter and the lessening global impacts of COVID-19 on commodity prices.
- Production averaged 555 boe/d (97 per cent weighted to natural gas and the remaining to condensate) for the three months ended March 31, 2021, as compared with 646 boe/d for the 2020 period.
- The company's two Jenbacher power units were installed in the first quarter of 2021 and commenced commercial production subsequent to the quarter-end. The power generation units have the capacity to produce as much as three megawatts of power and utilize the company's wholly owned RK gas field.
- On April 30, 2021, the company announced it had entered into a share purchase agreement to sell its 50-per-cent interest in CNG Holdings, which indirectly owns the Uzghorod licence in western Ukraine. In consideration, the company is to receive 800,000 euros ($970,000 (U.S.)) for its 50-per-cent interest in CNG Holdings. The consideration consists of 600,000 euros ($728,000 (U.S.)) in cash on closing and 200,000 euros ($242,000 (U.S.)) is a contingent payment on certain future events including a commercial discovery. The closing is subject to certain conditions including Ukraine regulatory approval.
Financial highlights
- The gross profit on the company's gas trading business increased to $709,000 during the three months ended March 31, 2021 as compared with $134,000 in gross profit in the comparative 2020 period.
- The company reported net income of $263,000 or $0 per share during the three months ended March 31, 2021, as compared with a net loss of $706,000 or $0 per share during the 2020 comparative period.
- Netbacks of $17.31 per barrel of oil equivalent or $2.88 per million cubif foot equivalent were achieved for the three months ended March 31, 2021, as compared with netback of $5.40/Boe or 90 cents/Mcfe for the 2020 first quarter.
About Cub Energy Inc.
Cub Energy is a power and upstream oil and gas company, with a proven record of exploration and production cost efficiency in Ukraine. The company's strategy is to implement western technology and capital, combined with local expertise and ownership, to increase value in its undeveloped land base, creating and further building a portfolio of assets within a high-commodity price environment.
We seek Safe Harbor.