Bengal Energy loses $1.06-million in Q1 2012Bengal Energy Ltd (C-BNG) - News Release
Bengal Energy loses $1.06-million in Q1 2012
2011-09-13 09:07 ET - News Release
Shares issued 51,961,349
BNG Close 2011-09-12 C$ 1.02
Mr. Chayan Chakrabarty reports
BENGAL ENERGY ANNOUNCES FISCAL Q1 2012 RESULTS - STRONG BALANCE SHEET AND BALANCED PORTFOLIO CONTRIBUTE TO STEADY GROWTH
Bengal Energy Ltd. has released its financial and operating results for the quarter ended June 30, 2011. A highlights table is attached.
The company exited the first quarter of fiscal 2012 with $37.6-million in cash, no debt, and a balanced portfolio of exploration and development drilling opportunities on its extensive land base in Australia and India.
Bengal's Cuisinier light oil discovery and follow-up development wells in the Cooper basin of Australia contributed steady growth in net operating income during the first quarter. Bengal achieved overall revenue during the quarter of $1.3-million compared with $691,000 in the previous quarter and $349,000 in the same quarter of fiscal 2011.
For the first quarter, total oil, natural gas and natural gas liquids (NGLs) production averaged 152 boe/d, an increase of 62% from the 94 boe/d produced in the same quarter of the previous year. The increase is a result of having the Company's Cuisinier 1 well on production for a full quarter in the current year compared with only part of the quarter during the previous year. Cuisinier 1 has been producing since May 2010.
Bengal's Cuisinier 2 and 3 wells were production tested in July 2011 and brought on stream at the end of August. Initial production estimates from the Operator prior to start-up are in excess of 250 barrels per day for Cuisinier 2 and 3 in total (63 bbl/d net). Bengal will release actual production numbers after the wells demonstrate sustained production rates.
The Cuisinier project continues to deliver strong operating netbacks. Bengal achieved field level operating netbacks on the project of $71.52 per barrel of oil equivalent (boe) during the quarter. This lifted Bengal's overall netback in the quarter to $48.92 per boe compared with a netback of $16.65 in the same quarter of fiscal 2011. The price the Company receives for its oil sales in Australia is based on the Dated Brent reference price which is currently trading at approximately US $25 per barrel premium to WTI.
Bengal's near-term drilling plans include an offshore exploration well at Kingtree on permit AC/P 24 in the Timor Sea of North West Australia. Bengal and its partner expect to spud Kingtree 1 in October 2011. The well is on a well defined, fault bound structure identified from 3D seismic. The location lies northeast and on trend with the formerly productive Challis-Cassini oilfield that achieved 60 million cumulative barrels of oil with peak production of 43,000 barrels of oil per day. The intent will be to vertically drill Kingtree 1 using a semi-submersible rig to a depth of 1,500 metres from 110 metres water depth. Bengal has a 10% interest in the well.
In India, Bengal is active both onshore and offshore. In the offshore Cauvery basin, Bengal continues evaluation work on its 340,000 acre, 100% owned and operated Production Sharing Agreement CY-OSN-2009/1. The first year work program includes reprocessing all available seismic records and acquiring 2D and 3D regional surveys from other operators. Data retrieval from government sources is ongoing with completion expected in late in 2011.
Onshore India, work is well underway on the first year program on Bengal's 30% working interest, 233,000 gross acre Production Sharing Agreement CY-ONN-2005/1. Reprocessing of existing seismic data is complete and a contractor has been engaged for the acquisition of 700 km2 of 3D seismic data. The acquisition program is expected to take place after the monsoon season in December and early in 2012.
Financial and Operating Summary
00s except per share, volumes and netback amounts Three Months Ended 06/30/1106/30/1003/31/11Revenue Natural gas $ 92 $ 125 $ 125 Natural gas liquids 16 21 17 Oil 1,211 202 549 Total 1,319 349 691Royalties 121 28 67 % of revenue 9.2 8.1 9.7Operating & transportation 522 179 295Netback(1) 676 142 328Cash flow used in operations: (1,371) (570) (746) Per share ($) (basic & diluted) (0.03) (0.03) (0.02)Funds from (used in) operations(2): 7 (546) (690) Per share ($) (basic & diluted) 0.00 (0.03) (0.02)Net (loss): (1,061) (722) (889) Per share ($) (basic & diluted) (0.02) (0.04) (0.03)Capital expenditures $ 1,933 $ 93 $ 1,879Volumes Natural gas (mcf/d) 249 381 348 Natural gas liquids (boe/d) 2 4 3 Oil (bbl/d) 108 27 56 Total (boe/d @ 6:1) 152 94 117Netback(1) ($/boe) Revenue $ 95.46 $ 40.92 $ 65.49 Royalties 8.77 3.31 6.38 Operating & transportation 37.77 20.96 27.97 Total $ 48.92$ 16.65 $ 31.13(1) Netback is a non-GAAP measure. Netback per boe is calculated by dividing the revenue and costs in total for the Company by the total production of the Company measured in boe. (2) Funds from operations is a non-GAAP measure. The comparable GAAP measure is cash flow from operations. A reconciliation of the two measures can be found in the table on page 5 of Bengal's management's discussion and analysis for the quarter ended June 30, 2011.
Bengal believes it is sufficiently capitalized to undertake its near-term drilling plans and fulfil its exploration commitments on its large acreage position. The Company has a range of both low-risk and high-impact drilling opportunities. Drilling success in Australia's Cooper Basin, both at Cuisinier and on the Company's Barta permit, are expected to drive near term and increasingly positive operating income for the Company and set the stage for future development.
Bengal has filed its consolidated interim financial statements and management's discussion and analysis for the three months ended June 30, 2011 with Canadian securities regulators. The documents are available on SEDAR at www.sedar.com or by visiting Bengal's website at www.bengalenergy.ca.
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