EARNINGS / Ranger Oil Ltd reports 1st 3 months Results
CALGARY, May 6 /CNW/ - Ranger Oil Limited announced today its financial
and operating results for the three months ended March 31, 1998.
Total revenues were US$80.1 million in the first three months of 1998
compared to US$99.2 million in 1997. Higher North American oil production
following the ELAN Energy Inc. acquisition in September 1997 was more than
offset by a significant decline in oil prices. Ranger's average realized price
for conventional oil declined 32 percent to US$14.03 per barrel, from US$
20.55 per barrel in 1997. Heavy oil prices were particularly low at US$3.20
per barrel due to a widening of the heavy/light oil price differential. North
American gas prices at US$1.44 per thousand cubic feet were 23 percent lower
than the previous year due to mild winter weather. North Sea gas prices
averaged US$3.11 per thousand cubic feet, a twelve percent reduction from
1997, as newly acquired gas production was sold on the spot market. Oil
production increased 37 percent to 52,983 barrels per day, from 38,721 barrels
in 1997, while gas production increased seven percent to 165.9 million cubic
feet per day.
Daily North American oil production increased to 30,575 barrels in the
first three months of 1998 from 4,369 barrels in 1997. This significant
increase was due to the acquisition of ELAN. Heavy oil production was 18,713
barrels per day, 13 percent lower than the last quarter of 1997 due to higher
operating cost wells being shut-in as a result of current low heavy oil
prices. North American daily gas production declined 12 percent to 127.0
million cubic feet in the first three months of 1998, from 145.1 million cubic
feet in 1997, mainly due to the sale of a part of the Company's interest in
the Helmet field, in northeast British Columbia, at the end of 1997.
North Sea daily oil production decreased 35 percent to 22,408 barrels in
the first three months of 1998 from 34,352 barrels in 1997. The Banff field
phase one production test contributed 6,106 barrels per day to the first
quarter of 1997. Phase two of the Banff development is scheduled to come
onstream in the fourth quarter of 1998 and contribute 15,000 barrels of daily
production in 1999. Production in the Columba ''B'' and ''D'' fields was
restricted in 1998 pending successful completion of water injection wells to
provide pressure support to producer wells. North Sea daily gas production
increased to 38.9 million cubic feet from 9.8 million cubic feet in 1997. The
increase was due to a higher working interest in the Anglia field, improved
deliverability and higher buyer nominations.
Operating costs increased slightly to US$33.9 million in the first three
months of 1998 from US$32.2 million in 1997. On a unit of production basis,
operating costs declined to US$5.00 per barrel of oil equivalent compared to
US$6.48 in the first quarter of 1997. Heavy oil operating costs of US$3.57 per
barrel were 30 percent lower than the last quarter of 1997.
Interest expense increased US$4.0 million to US$6.5 million for the
quarter as a result of higher debt levels following the ELAN acquisition.
General and administrative expense increased to US$4.0 million from US$2.1
million the previous year. Depletion and depreciation expense was US$38.4
million, compared with US$32.3 million in 1997, with the impact of higher
volumes being partly offset by a reduced unit of production charge.
The Company had a loss before tax of US$4.0 million in the first three
months of 1998 compared with earnings of US$26.7 million in 1997. After tax
the loss was US$11.4 million (US$0.09 per share) compared to earnings of
US$13.1 million (US$0.13 per share) in 1997. Taxes decreased by US$6.2 million
mainly due to lower pre-tax earnings. The decline in earnings was mainly due
to lower oil prices, with heavy oil operations accounting for the majority of
the loss.
Funds generated from operations before tax decreased to US$32.7 million
in the first three months of 1998 from US$62.4 million in 1997. Funds
generated from operations after tax were US$29.5 million (US$0.23 per share)
compared to US$47.0 million (US$0.47 per share) in 1997.
Net capital expenditures for the first quarter of 1998 were US$70.7
million, US$50.6 million of which was for development projects. In North
America, expenditures of US$25.3 million were mainly attributable to the winter
drilling program at Helmet, and the exploration programs at Fort Liard and
Fort Norman in the Northwest Territories. A potentially significant gas
discovery was made at Fort Liard and further testing is planned for this
summer. Two wells drilled in the Fort Norman area have been suspended with
additional testing to take place next winter. International expenditures of
US$22.6 million were mainly for development of the Kiame field in Angola.
Kiame is scheduled to commence production mid-year at a rate of 7,000 barrels
of oil per day. The North Sea accounted for US$22.8 million, the majority of
which related to development expenditures on the Pierce, Ninian, and Columba
''E'' projects. Pierce is scheduled to come onstream in the fourth quarter of
1998 at a rate of 7,000 barrels of oil per day. Columba ''E'' should commence
production in the second quarter.
Issued by: F. J. Dyment
President and Chief Executive Officer
<<
SUMMARY
(unaudited)
Three Months Ended March 31, 1998 1997
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FINANCIAL (millions of US dollars,
except per share amounts)
Revenues $ 80.1 $ 99.2
Funds generated from operations
before tax $ 32.7 $ 62.4
Funds generated from operations $ 29.5 $ 47.0
Earnings (loss) before tax $ (4.0) $ 26.7
Earnings (loss) $ (11.4) $ 13.1
Per common share
Funds generated from operations $ 0.23 $ 0.47
Earnings (loss) $ (0.09) $ 0.13
Dividends $ - $ 0.08
Capital expenditures, net $ 70.7 $ 39.2
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AVERAGE PRICES (U.S. dollars)
Crude oil and natural gas liquids
(per barrel)
North Sea $ 14.06 $ 20.58
North America - conventional $ 13.96 $ 20.31
- heavy $ 3.20 $ -
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Weighted Average $ 10.20 $ 20.55
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Natural gas (per thousand cubic feet)
North Sea $ 3.11 $ 3.55
North America $ 1.44 $ 1.87
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Weighted Average $ 1.83 $ 1.97
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DAILY PRODUCTION, BEFORE ROYALTIES
Crude oil and natural gas liquids (barrels)
North Sea 22,408 34,352
North America - conventional 11,862 4,369
- heavy 18,713 -
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52,983 38,721
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Natural gas (million cubic feet)
North Sea 38.9 9.8
North America 127.0 145.1
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165.9 154.9
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CONSOLIDATED BALANCE SHEET
(unaudited) (millions of US dollars)
March 31, December 31,
1998 1997
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ASSETS
Current Assets
Cash $ 11.9 $ 22.4
Accounts receivable 68.3 109.2
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80.2 131.6
Property, Plant and Equipment 1,270.5 1,237.6
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$ 1,350.7 $ 1,369.2
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LIABILITIES
Current Liabilities
Accounts payable and accrued
liabilities $ 102.6 $ 82.7
Royalties payable 7.9 13.7
Taxes payable 7.7 16.1
Current portion of long-term debt 29.2 15.1
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147.4 127.6
Long-Term Debt 396.9 427.0
Deferred Revenue 2.3 5.3
Future Site Restoration 77.7 75.9
Deferred Tax 92.3 88.0
SHAREHOLDERS' EQUITY
Capital Stock
Authorized
Preferred and common shares
without par value in unlimited
number
Issued
Common shares 125,894,263
(1997 - 125,864,143) 528.4 528.3
Retained Earnings 105.7 117.1
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634.1 645.4
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$ 1,350.7 $ 1,369.2
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CONSOLIDATED STATEMENT OF EARNINGS
(unaudited) (millions of US dollars, except per share amounts)
Three Months Ended March 31, 1998 1997
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REVENUES
Oil and gas revenue $ 76.0 $ 99.1
Royalties (9.7) (13.2)
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66.3 85.9
Transportation and processing 10.5 9.7
Other 3.3 3.6
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80.1 99.2
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EXPENSES
Operating 33.9 32.2
General and administrative 4.0 2.1
Interest 6.5 2.5
Depletion and depreciation 38.4 32.3
Future site restoration 1.3 3.4
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84.1 72.5
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EARNINGS (LOSS) BEFORE TAX (4.0) 26.7
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TAX
Petroleum Revenue Tax 4.7 8.1
Income tax 2.7 5.5
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7.4 13.6
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EARNINGS (LOSS) $ (11.4) $ 13.1
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Weighted average number of common shares
outstanding (thousands) 125,891 99,038
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Earnings (loss) per common share,
basic and fully diluted $ (0.09) $ 0.13
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CONSOLIDATED STATEMENT OF CHANGES IN CASH
(unaudited) (millions of US dollars)
Three Months Ended March 31, 1998 1997
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OPERATING ACTIVITIES
Earnings (loss) $ (11.4) $ 13.1
Non cash items:
Depletion and depreciation 38.4 32.3
Future site restoration 1.3 3.4
Deferred tax (reductions) 4.2 (1.8)
Other (3.0) -
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Funds generated from operations 29.5 47.0
Changes in non-cash working capital (17.9) 19.4
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11.6 66.4
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FINANCING ACTIVITIES
Long-term debt (16.0) -
Common shares issued 0.1 0.5
Common share dividends - (7.9)
Changes in non-cash working capital - 7.9
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(15.9) 0.5
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INVESTING ACTIVITIES
Property, plant and equipment (72.1) (39.3)
Proceeds on sales of property
and equipment 1.4 0.1
Changes in non-cash working capital 64.5 (2.4)
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(6.2) (41.6)
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INCREASE (DECREASE) IN NET CASH (10.5) 25.3
Net cash, beginning of period 22.4 (56.8)
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Net cash, end of period $ 11.9 $ (31.5)
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