divime1 wrote:
Tamarack Valley earns $230.2-million in Q2
2021-07-27 16:42 ET - News Release
Mr. Brian Schmidt reports
TAMARACK VALLEY ENERGY LTD. ANNOUNCES SECOND QUARTER FINANCIAL RESULTS, OPERATIONAL UPDATE & EXECUTIVE CHANGES
Tamarack Valley Energy Ltd. has released its financial and operating results for the three and six months ended June 30, 2021. Selected financial and operational information is outlined below and should be read in conjunction with Tamarack's unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2021 and related management's discussion and analysis ("MD&A") which are available on SEDAR and on Tamarack's website.
Brian Schmidt, President and CEO of Tamarack commented: "We are proud to report another very strong quarter driven by the successful integration of Anegada Oil Corp. ("Anegada") along with the continued execution of our Clearwater and Waterflood operations. The Anegada acquisition complements our balanced asset portfolio and provides further upside and resiliency to our free adjusted funds flow(1) and potential return of capital profile. In addition, we remain focused on advancing the 2021 initiatives and targets set within our robust environmental, social and governance ("ESG") reporting."
Q2 2021 Financial and Operating Highlights
- Successfully closed the acquisition of Anegada on June 1, 2021, providing the Company an entrance into the Charlie Lake light oil play ("Charlie Lake"), one of the most profitable oil plays in North America.
- The Company's syndicate of lenders increased the Company's credit facilities to $600 million and extended the revolving period to May 31, 2022.
- Achieved quarterly production volumes of 32,416 boe/d(2) in Q2/21, representing a 54% increase compared to the same period in 2020.
- Generated adjusted funds flow(1) of $71.7 million in Q2/21 ($0.21 per share basic and diluted) compared to $21.0 million in the same period in 2020 ($0.09 per share basic and diluted).
- Generated free adjusted funds flow(1), excluding acquisition expenditures, of $40.9 million and net income of $230.2 million during the quarter.
- Invested $30.8 million in exploration and development capital expenditures, excluding acquisitions, during the second quarter of 2021, which contributed to the drilling of 20 (20.0 net) wells, comprised of 10 (10.0 net) Viking oil wells, 8 (8.0 net) Clearwater oil wells and 2 (2.0 net) Charlie Lake oil wells.
- Exited the second quarter with $506 million of net debt; with a forecasted year end 2021 net debt to Q4 annualized adjusted funds flow(1) of less than 1.2x.
Charlie Lake Update
Tamarack brought on its first two operated Charlie Lake light oil wells in June (12-16-071-08W6 and 02/16-22-073-07W6) with IP30 rates of approximately 1,367 boe/d(3) (1,157 bopd) and 1,048 boe/d(4) (650 bopd), respectively. This compares to the internal TVE Tier 8 development type curve of 482 bbls/d. Production for June and July was impacted by third party plant outages due to the extreme temperatures that plagued the province. However, the Company remains on track with its planned production range of 12,000-13,000 boe/d(5) for the asset going forward, with current production of approximately 13,000 boe/d(5). Tamarack currently has three rigs running with the third and fourth wells in the program rig released.
Clearwater Update
In the quarter Tamarack drilled 8 gross (8.0 net) Clearwater wells in the Nipisi area bringing the yearly total to 23.5 net wells for the year in Nipisi and Jarvie. All the wells in the second quarter were drilled with 8 legs, and Tamarack plans to continue with this strategy throughout the remainder of 2021. Average well production from the second quarter program is 210bbls/d(6) (8-leg laterals) after cleanup versus the 160 bbls/d(6) winter program 6-leg average in the core Nipsi development area with well costs for the eight leg laterals averaging an incremental $105 thousand per well, driving significant capital efficiency gains. Total Clearwater production averaged 4,550bbls/d(7) for the quarter with June averaging approximately 5,000bbls/d(7).
Tamarack plans to drill another 13-14 net wells in Nipisi keeping one rig working throughout the year with a second rig planned to start up in December. Additionally, Tamarack plans to participate in 3-4 net (6-8 gross) wells in the Jarvie area. Gas conservation work is slated to begin at Nipisi in July with commissioning and start up in late September. In addition to this, technical work continues on a waterflood pilot and high graded areas for a trial have been selected. Tamarack anticipates drilling the pilot in early Q4 with injection slated to start in late Q4 2021 or early Q1 2022.
Executive Changes
Tamarack wishes to congratulate Mr. Floyd Price, Chairman of the Board, on his retirement effective July 27, 2021. Mr. Price has served on the Board of Directors since inception and successfully guided the company through several key acquisitions and market events. His imprint on strategy and guidance has been key to Tamarack's success.
Tamarack also congratulates Mr. Dave Christensen, Vice President, Engineering on his retirement effective August 31 st, 2021. Mr. Christensen has been an officer of the Company since 2014. We would like to thank him for his many contributions to the company over the years.
As a result of the strategic organizational changes and retirements, Tamarack has made the following executive appointments:
- Mr. John Rooney, a director of the Company, has been elected to be Chair of the Board of Directors. Mr. Rooney has run several oil and gas companies most recently CEO of Northern Blizzard and Tusk Energy. He currently serves as Chairman of Kara Technologies and is on the Board of Western Energy Services.
- Mr. Kevin Screen has been promoted to Chief Operating Officer. Mr. Screen has served as Vice President, Production & Operations since he joined the Company in 2011 and has been instrumental in the strategic development and effective operational execution that have driven Tamarack's success to date. Mr. Martin Malek has been appointed as successor to Mr. Christensen as Vice President, Engineering.
- Mr. Malek has served in various roles across the organization since joining in 2014. He most recently served as Vice President, Business Development and has been a pivotal driver in Tamarack's acquisition activity over the past year.
Tamarack is also pleased to announce the appointment of Ms. Christine Ezinga as Vice President, Corporate Planning and Business Development, and Mr. Scott Shimek as Vice President, Production and Operations. Ms. Ezinga brings more than 20 years of industry experience in finance, investor relations and business development, including mergers and acquisitions. Most recently, she held the role of Vice President, Strategy & Planning at Black Swan Energy. Mr. Shimek brings more than 15 years of engineering and operations experience, most recently serving as Vice President, Resource Development at Bonavista Energy Corp. The Company is excited to add the skills and perspectives of these bright young leaders to the strong existing team.
"On behalf of the Board of Directors, executive management team and all of our staff, I would like to extend sincere appreciation to Floyd and Dave for their many contributions which are imprinted in our success. They have been instrumental in building the Company into what it is today" said Brian Schmidt, President and Chief Executive Officer. "We wish them well in retirement. I would also like to congratulate both Kevin and Martin on their new roles and welcome Christine and Scott to Tamarack. We are excited to be able to bring in this exceptional talent to complement our executive team".
Investor Webcast
Tamarack will host a webcast at 9:00 AM MT (11:00 AM ET) on July 28, 2021 to discuss the second quarter financial results and provide an investor update. Participants can access the live webcast via this link or through links provided on the Company's website. A recorded archive of the webcast will be available on the Company's website following the live webcast.