CALGARY, ALBERTA – (Marketwired – Feb. 10, 2016) –
Birchcliff Energy Ltd. (“Birchcliff”) (TSX:BIR)
is pleased to announce its unaudited 2015 year-end and fourth quarter
financial and operational results, with record annual average production
of 38,950 boe per day and record low operating costs of $4.54 per boe
in 2015, as well as highlights from its independent reserves evaluation
effective December 31, 2015. Birchcliff is also pleased to provide an
operational update.
Birchcliff estimates that its production for January 2016 averaged approximately 42,000 boe per day.
Jeff Tonken, President and Chief Executive Officer of Birchcliff,
stated: “Our proved plus probable reserves increased 23% to 572.9 MMboe
as at December 31, 2015. The future net revenue from these reserves
(discounted at 10%) increased slightly to approximately $3.9 billion
from $3.8 billion in 2014, notwithstanding materially lower commodity
price forecasts.
Our proved developed producing reserves were added at $7.79 per boe
during 2015. This means that we added proved developed producing
reserves for approximately 2/3 of the funds flow netback we received on
the sale of production, which is the true test of a low-cost finder and
producer of oil and gas.
Our 2015 operational results are very strong, with record annual
average production of 38,950 boe per day, a 15% increase from 2014,
while total cash costs of $11.01 per boe were down 21% from 2014.
Birchcliff has proven that its business works at low commodity prices and our operational execution has been on budget and on time.”
PRESS RELEASE HIGHLIGHTS
2015 Year-End Financial and Operational Results
- Record annual average production of 38,950 boe per day, a
15% increase from 2014 annual average production of 33,734 boe per day.
Production consisted of 86% natural gas, 10% light oil and 4% NGL.
- Funds flow of $160.8 million ($1.06 per basic common share), a 47% decrease from $300.5 million ($2.03 per basic common share) in 2014.
- Net loss to common shareholders of $16.2 million ($0.11 per basic common share), a decrease from net income to common shareholders of $110.3 million ($0.75 per basic common share) in 2014.
- Adjusted net income to common shareholders of $1.8 million,
which excludes two one-time, non-cash deferred income tax expense items
in the aggregate amount of $18.0 million, which are non-operational in
nature.
- Record low operating costs of $4.54 per boe, a 13% decrease from $5.22 per boe in 2014.
- Record low general and administrative expense of $1.61 per boe, an 11% decrease from $1.81 per boe in 2014.
- Record low total cash costs of $11.01 per boe (royalties,
operating, transportation and marketing, general and administrative and
interest expense), a 21% decrease from $14.02 per boe in 2014.
- Plant and field operating costs were approximately $0.31 per
Mcfe ($1.90 per boe) in 2015 at Birchcliff’s 100% owned natural gas
plant located in the Pouce Coupe South area (the “PCS Gas Plant”), where
Birchcliff processed 81% of its total corporate natural gas production
and achieved an operating margin of 77%.
- Funds flow netback of $11.31 per boe, a 54% decrease from $24.40 per boe in 2014.
- Long-term bank debt of $622.1 million against
available lines of credit of approximately $800 million. Total debt at
December 31, 2015, including working capital deficit, was $643.6
million.
- Capital expenditures of $247.2 million.
- Birchcliff had an active drilling program during 2015 drilling a total of 32 (31.5 net) wells, consisting of:
- 28 (28.0 net) Montney/Doig horizontal natural gas wells in the Pouce Coupe area;
- 1 (1.0 net) Montney/Doig horizontal natural gas well in the Elmworth area;
- 1 (1.0 net) Charlie Lake horizontal light oil well in the Progress area;
- 1 (0.5 net) Halfway horizontal light oil well in the Progress area; and
- 1 (1.0 net) Belloy vertical well drilled as an acid gas disposal well in the Elmworth area.
- Undeveloped land base of 426,012.6 (398,412.7 net) acres at December 31, 2015, with a 94% average working interest.
- As at December 31, 2015, Birchcliff has drilled an aggregate of 188 (187.9 net) Montney/Doig horizontal natural gas wells, continuing to optimize its execution.
- Birchcliff’s potential net future horizontal drilling
locations on the Montney/Doig Natural Gas Resource Play increased to
3,367.3 at December 31, 2015 from 3,346.3 at year-end 2014.