CALGARY, AB / ACCESSWIRE / November 29, 2021 / Southern Energy Corp. ("Southern" or the "Company") (TSXV:SOU)(AIM:SOUC) today announces the release of its third quarter financial and operating results for the three and nine months ended September 30, 2021. The Company also notes that an updated corporate presentation can now be found on the Company's website at www.southernenergycorp.com.
Southern is an established producer with natural gas and light oil assets in Mississippi and Alabama characterized by a stable, low-decline production base, a significant low-risk drilling inventory and strategic access to the best commodity pricing in North America. Selected financial and operational information is outlined below and should be read in conjunction with the Company's consolidated financial statements (the "Financial Statements") and related management's discussion and analysis (the "MD&A") for the three and nine months ended September 30, 2021, which are available on the Company's website at www.southernenergycorp.com and have been filed on SEDAR.
All figures referred to in this news release are denominated in Canadian dollars, unless otherwise noted.
Q3 2021 Highlights
· $1.7 million of adjusted funds flow from operations[1] in Q3 2021, excluding $1.9 million of one-time expenses related to AIM listing, a 51% increase from the same period in 2020
· Average production of 12,237 Mcfe/d[2] (2,040 boe/d), 92% natural gas in Q3 2021, a 7% decrease from the same period in 2020
· Petroleum and natural gas sales of $6.6 million in Q3 2021, an increase of 85% from the same period in 2020
· As at September 30, 2021, Net Debt1 of $19.2 million, a reduction of $10.1 million or 35% from December 31, 2020
· Net earnings of $5.5 million in Q3 2021 ($0.02 per share - basic) compared to a net loss of $3.0 million in Q3 2020
· Average realized oil and natural gas prices for Q3 2021 of $85.50/bbl and $5.10/Mcf, respectively, reflecting the benefit of strategic access to premium-priced US sales hubs
· Completed a series of low-cost well recompletions and workovers beginning in Q3 and carrying into early Q4 2021
o Work program had an overall cost of approximately $1.0 million ($0.9 million in Q3 2021) and added approximately 1,250 Mcfe/d[3] (208 boe/d) of production (approximately 80% natural gas)
o At current strip pricing, the program is expected to payout in approximately 4 - 5 months and add more than $1.6 million of cash flow from operating activities in 2022 after payout
· In August 2021, successfully completed admission of its entire issued share capital to trading on the AIM market of the London Stock Exchange plc
Subsequent Events
On November 24, 2021, Southern closed an equity financing for aggregate gross proceeds of $12.7 million (US$10.1 million) through the issuance of a total of 254.3 million common shares ("Common Shares") (the "Offering"), of which $6.7 million was raised pursuant to a private placement of 135.1 million Common Shares to UK investors at a price of 2.94 pence per Common Share and the remaining $6.0 million was raised pursuant to a short form prospectus offering of 119.2 million Common Shares at a price of $0.05 per Common Share.
Southern intends to use the net proceeds of the Offering to drill up to three horizontal Selma Chalk wells in the Gwinville gas field and for working capital and general corporate purposes. This is expected to provide the business with additional near-term cash flow generation.
https://www.accesswire.com/674961/Southern-Energy-Corp-Announces-Third-Quarter-Financial-and-Operating-Results
