EARNINGS / Big Bear Exploration Announces Unaudited Third Quarter
1998 Financial And Operating Results
CALGARY, ALBERTA--
Big Bear Exploration Ltd. ("Big Bear") announced today the
following unaudited financial and operational results for the nine
month period ended September 30, 1998.
Production and cash flow from operations increased significantly
in the first nine months of 1998 as compared to the same period in
1997. The majority of the production increase in 1998 resulted
from the Keg River horizontal oil wells drilled in the first
quarter of 1998 on the Company's core property located at Rainbow
Lake in north-western Alberta. Cash flow resulting from this
production increase was significantly impacted by lower oil prices
realized in 1998 as compared to those realized in the same period
in 1997. However, Big Bear was still able to realize increased
cash flow for the first nine months of 1998.
/T/
3 Months, 9 Months
Ended Sept. 30 Ended Sept. 30
1998 1997 1998 1997
FINANCIAL (unaudited) (unaudited)
($ 000's except per
share amounts)
Total revenues, net
of royalties 2,940 1,065 9,262 2,641
Cash flow from operations 614 553 2,704 1,330
Basic per common share $0.011 $0.025 $0.069 $0.067
Fully diluted per
common share $0.011 $0.024 $0.061 $0.066
Income (loss) for the
period (2,012) 75 (19,514) 397
Basic per common
share $(0.057) $0.003 $(0.554) $0.020
Long-term debt 19,462 2,083 19,462 2,083
Working capital
(deficiency) 8,126 (2,447) 8,126 (2,447)
Shareholders' equity 38,424 10,464 38,424 10,464
Capital expenditures,
net 1,684 3,222 44,511 13,905
Common shares
outstanding (ending) 58,696 22,422 58,696 22,422
Preferred shares
outstanding (ending) 13,091 - 13,091 -
OPERATIONAL
Average daily production
(boe) 2,217 732 2,204 580
Oil and NGLs (bbls) 1,770 300 1,728 251
Natural gas (mcf) 4,471 4,316 4,764 3,289
Average sales price
(before hedging)
Oil and NGLs (per bbl) $18.72 $23.68 $19.25 $24.20
Natural gas (per mcf) $1.81 $1.40 $1.76 $1.44
Wells drilled (gross (net)) 3(2.4) 8(5.4) 16(12.3) 18(12.7)
/T/
On a quarter over quarter basis, production and cash flow
decreased in the third quarter of 1998 as compared to the second
quarter. Production decreased due to the restrictions from the
winter-access-only nature of Rainbow Lake which limited Big Bear's
ability to service certain wells. Natural declines in oil
production and the sale of a minor gas property also contributed
to lower production. Cash flow decreased due to the lower
production, a slight decrease in commodity prices and also an
increase in a foreign exchange hedging loss. Income in the third
quarter of 1998 was adversely impacted by a $680,000 write-down of
marketable securities. Capital expenditures in the third quarter
amounted to $2,299,000 as compared to the second quarter amount of
$2,159,000. Also an issue of 20,057,582 common shares was
completed near the end of the third quarter of 1998 for total
gross proceeds of $11,032,000.
Big Bear is continuing to pursue gas exploration opportunities.
During the third quarter the company participated in three gross
(2.4 net) exploratory gas wells resulting in two (2.0 net) gas
wells for an overall success rate of 67 percent. For the remainder
of 1998 the company expects to participate in one or two
additional exploratory gas wells. Additionally, Big Bear will be
participating in one vertical exploratory oil well in Rainbow Lake
designed to prove up a new exploration concept. This could
potentially lead to several additional new opportunities separate
from the numerous horizontal re-entry opportunities available to
the company. Given the current depressed oil prices Big Bear has
temporarily delayed the majority of its re-entry well activity in
Rainbow Lake.
Big Bear Exploration Ltd. is a Calgary based oil and gas company
listed on The Toronto Stock Exchange under the symbol "BDX".
/T/
BIG BEAR EXPLORATION LTD.
Consolidated Balance Sheets
--------------------------------------------------------------
(thousands of dollars As at As at
September 30 December 31
1998 1997
--------------------------------------------------------------
(unaudited)
ASSETS
Current assets
Cash and short term deposits $ 7,603 $ 1,796
Accounts receivable 3,132 5,407
Marketable securities 2,441 -
Deposits - 2,800
--------------------------------------------------------------
13,176 10,003
Capital assets 50,210 28,757
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$ 63,386 $ 38,760
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--------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued
liabilities $ 5,050 $ 10,085
Current portion of long-term debt 5,462 -
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10,512 10,085
Long-term debt 14,000 11,830
Provision for future site restoration 450 210
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24,962 22,125
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Shareholders' Equity
Share capital
Preferred 15,714 -
Common 42,755 16,929
Deficit (20,045) (294)
--------------------------------------------------------------
38,424 16,635
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$ 63,386 $ 38,760
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BIG BEAR EXPLORATION LTD.
Consolidated Statements of Income and Retained Earnings
--------------------------------------------------------------
(thousands of dollars, 3 Months Ended 9 Months Ended
except per share September 30 September 30
amounts) 1998 1997 1998 1997
--------------------------------------------------------------
(unaudited)(unaudited)(unaudited)(unaudited)
REVENUE
Petroleum and
natural gas
sales $ 3,513 $ 1,217 $ 10,927 $ 2,958
Other income 4 18 44 51
Royalties, net of
ARTC (577) (170) (1,709) (368)
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2,940 1,065 9,262 2,641
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EXPENSES
Operating 1,422 411 3,809 983
General and
administrative 577 71 1,623 281
Interest 317 30 1,046 47
Depletion and
depreciation 1,946 478 5,538 933
Write-down of
marketable securities 680 - 680 -
Write-down of capital
assets - - 16,000 -
--------------------------------------------------------------
4,942 990 28,696 2,244
--------------------------------------------------------------
Income (loss) before
taxes (2,002) 75 (19,434) 397
Capital taxes (10) - (80) -
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Income (loss) for the
period (2,012) 75 (19,514) 397
Retained earnings
(deficit), beginning
of period (17,839) 196 (294) (126)
Dividends - convertible
preferred shares (194) - (237) -
--------------------------------------------------------------
Retained earnings
(deficit), end of
period $ (20,045) $ 271 $ (20,045) $ 271
--------------------------------------------------------------
--------------------------------------------------------------
Income (loss) per
common share $ (0.057) $ 0.003 $ (0.554) $ 0.020
--------------------------------------------------------------
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BIG BEAR EXPLORATION LTD.
Consolidated Statements of Changes in Financial Position
--------------------------------------------------------------
3 Months Ended 9 Months Ended
September 30 September 30
(thousands of dollars)1998 1997 1998 1997
--------------------------------------------------------------
(unaudited)(unaudited)(unaudited)(unaudited)
Cash provided by
(used in):
OPERATING ACTIVITIES
Income (loss) for
the period $ (2,012) $ 75 $ (19,514) $ 397
Items not affecting
working capital
Depletion and
depreciation 1,946 478 5,538 933
Write-down of
marketable securities 680 - 680 -
Write-down of capital
assets - - 16,000 -
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Cash flow from
operations 614 553 2,704 1,330
Net changes in non-cash
working capital 2,856 1,542 40 1,507
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3,470 2,095 2,744 2,837
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FINANCING ACTIVITIES
Increase (decrease)
in long-term debt (1,140) 1,136 7,632 2,083
Issue of common
shares and special
warrants 10,249 - 27,586 7,576
Issue of convertible
preferred shares (36) - 15,714 -
Dividends on convertible
preferred shares (194) - (237) -
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8,879 1,136 50,695 9,659
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INVESTING ACTIVITIES
Petroleum and natural
gas properties, net (1,684) (3,222) (44,511) (7,511)
Purchase of marketable
securities (3,121) - (3,121) -
Purchase of Pamplona
Energy Limited - - - (6,394)
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(4,805) (3,222) (47,632) (13,905)
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Increase (decrease)
in cash 7,544 9 5,807 (1,409)
Cash , beginning of
period 59 (217) 1,796 1,201
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Cash (indebtedness),
end of period $ 7,603 $ (208) $ 7,603 $ (208)
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