Petroamerica announces 2011 year-end results with highlights on Balay oil production revenue and the Las Maracas light oil discovery
Press Release: Petroamerica Oil Corp. – 22 hours ago
finance.yahoo.com
CALGARY , April 30, 2012 /CNW/ - Petroamerica Oil Corp. ( PTA.V) ("Petroamerica" or the "Company"), a junior oil and gas company with activities in Colombia , is pleased to announce the financial and operating results for the year ended December 31, 2011 . Copies of the Company 's Management Discussion and Analysis ("MD&A") and Financial Statements have been filed with the Canadian Securities Regulatory Authorities and can be viewed or downloaded at the Company's website at www.petroamericaoilcorp.com or at www.sedar.com.
Highlights include:
(all balances in Canadian dollars, unless otherwise noted)
- The successful appraisal of the Balay oil discovery and the discovery of light oil at Las Maracas;
- The generation from Balay of $10.5 million in production revenue, after royalty, achieving an average sales price of US $108.15 per barrel and an operating netback of approximately US $71 per barrel for the year;
- Formal recognition from the Colombian National Hydrocarbon Agency ("ANH") for the 15% working interest in the Balay Block;
- The establishment of an independently audited Company reserves base with proved plus probable reserves of 3.027 million barrels of oil net to the Company, and an estimated net present value of $122.5 million (discount 10% and after royalties).
- A significant rationalization of the Company's land portfolio by divesting or withdrawing from non-core assets and focusing on high potential blocks;
- The approval of a Shareholder's Rights Plan aimed at protecting shareholders and extracting fair value in the event of an unsolicited takeover offer;
The following table presents the highlights of Petroamerica's financial and operating results for the three and twelve months ended December 31, 2011 and 2010.
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| | Highlights | Three Months Ended
December 31 | Twelve Months Ended
December 31 | (in $000 except share and per share and
per barrel amounts) | 2011 | 2010 | 2011 | 2010 | | Oil revenue - net of royalties | $5,875 | $- | $10,454 | $- | | Total sales volumes -bbls | 50,000 | - | 105,500 | - | | Average selling price US$/bbl | $112.70 | $- | $108.15 | $- | | Average production cost US$/bbl | $29.46 | $- | $28.41 | $- | | Loss for period | $2,869 | $18,249 | $31,919 | $26,293 | | Total comprehensive loss | $4,175 | $20,435 | $28,219 | $29,500 | | Loss per share - Basic and Diluted | $0.00 | $0.04 | $0.06 | $0.07 | | Common shares outstanding | 578,331,594 | 418,362,094 | 578,331,594 | 418,362,094 | | Weighted average shares outstanding |
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| Basic and Diluted | 578,331,594 | 380,016,303 | 521,900,717 | 352,950,250 | | Exploration costs | $1,925 | $12,766 | $24,048 | $19,009 | | Total assets | $94,887 | $101,113 | $94,887 | $101,113 | | Shareholders' equity | $86,019 | $80,166 | $86,019 | $80,166 |
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| | Share trading |
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| High | $0.15 | $0.67 | $0.74 | $0.82 |
| Low | $0.08 | $0.29 | $0.08 | $0.28 |
| Close | $0.11 | $0.61 | $0.11 | $0.61 | | Trading volume | 108,092,700 | 114,003,500 | 477,565,700 | 327,574,900 | Fourth Quarter Financial Summary
Net after royalty production for the fourth quarter of 2011 averaged 388 barrels of oil per day. During the fourth quarter of 2011 the realized sales price was US $112.70 per barrel generating an operating netback of approximately US $74 per barrel. The realized sales price was closer to Brent benchmark pricing and 50,000 barrels of oil was sold generating proceeds of approximately $5.4 million after royalties.
For the fourth quarter of 2011, the Company's net loss was $2.1 million ( $0.00 per share diluted). The Company 's funds flow for the current quarter from operating activities increased by $8.7 million over the fourth quarter in 2010 to $3.2 million . The Company's capital expenditures for the fourth quarter were $8.7 million , all invested in Colombia . These capital expenditures were funded from available cash and funds flow from operations.
Operations Update
In 2012, the Company plans to participate in the drilling of up to six exploration wells. All of the prospects to be drilled are covered by 3D seismic and are located in the Los Ocarros, El Eden, El Porton, CPO-1, LLA-10 and SSJN-5 Blocks. Most of the exploration drilling is expected to take place in the second half of 2012.
To date, the Company's wholly-owned subsidiary, Petroamerica International Corp., has been recognized by the ANH as to its participating interests in the Balay, Los Ocarros, El Eden and El Porton Blocks, and applications to be recognized as to its participating interest in the other blocks, subject to ANH approval, are underway.
Commerciality declarations were made on the Chiriguaro and Balay oil fields in December 2011 and March 2012 respectively. The development plan for the Balay field should be finalized between partners in May of this year. The Balay-3 appraisal well was drilled in the northern part of the structure and the results were announced in January 2012 . It is planned to convert this well into a water disposal well.
It is anticipated that the Las Maracas-2 sidetrack discovery well will see first oil in the second quarter of 2012, and two follow-up appraisal wells are expected to be drilled. These wells are expected to be drilled back-to-back, with the first well spud expected at the end of the second quarter, 2012. This first well will also test the deeper exploration potential in the Gacheta and Une Formation reservoirs in the Las Maracas discovery structure. In the event of success, an option is being retained to drill an additional two follow-up early development wells in the second half of the year.
Financial Update
On April 19, 2012 the Company closed $35 million in debt financing by issuing 3,500 units at a price of $10,000 each. Each unit consists of a $10,000 in principal amount of senior secured notes bearing interest at 11.5% per annum, payable quarterly, with a maturity date of April 19, 2015 (the "Notes"), and one warrant entitling the holder to purchase 10,000 common shares of the Company at $0.20 per share up to April 19 , 2015. The Notes have been secured by the Company's property and are senior to all other indebtedness and liabilities of the Company. The Company will use the proceeds raised to support the appraisal and development programs for the Las Maracas and Balay discoveries as well as to support additional development, appraisal and other costs that are expected to arise from the 2012 exploration program and for general corporate purposes.
Statement of Reserves
Petroamerica has today filed a 51-101F1 - Statement of Reserves and Other Oil and Gas Information included in and forming part of its Annual Information Form, which is available for viewing under the Company's profile at www.sedar.com.
PETROAMERICA OIL CORP.
Consolidated Statements of Financial Position
(Expressed in Canadian dollars)
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| As at
December 31,
2011 |
| As at
December 31,
2010 |
| As at
January 1,
2010 | | Assets |
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| | Current assets |
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| Cash and cash equivalents | $ | 19,294,554 | $ | 24,111,723 | $ | 41,691,354 |
| Available for sale investments |
| - |
| 2,831,550 |
| - |
| Trade and other receivables |
| 7,242,516 |
| 1,169,796 |
| 116,246 |
| Prepayments and deposits |
| 417,837 |
| 161,784 |
| 27,233 |
| Inventories |
| 563,530 |
| 531,884 |
| - |
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| 27,518,437 |
| 28,806,737 |
| 41,834,833 | | Non-current assets |
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| Restricted cash |
| 7,926,079 |
| 9,984,273 |
| 8,100,791 |
| Property, plant and equipment |
| 14,881,718 |
| 121,213 |
| 25,912 |
| Exploration and evaluation assets |
| 44,560,366 |
| 62,200,872 |
| 39,467,200 |
| Investments - equity |
| - |
| - |
| 5,046,828 |
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| 67,368,163 |
| 72,306,358 |
| 52,640,731 | | Total assets | $ | 94,886,600 | $ | 101,113,095 | $ | 94,475,564 |
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| | Liabilities |
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| | Current liabilities |
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| Current equity tax | $ | 404,703 | $ | - | $ | - |
| Accounts payable and accrued liabilities |
| 5,016,607 |
| 17,016,508 |
| 4,361,781 |
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| 5,421,310 |
| 17,016,508 |
| 4,361,781 | | Non-current liabilities |
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| Decommissioning liabilities |
| 176,000 |
| - |
| - |
| Deferred tax liabilities |
| 2,601,828 |
| 3,931,000 |
| 10,669,000 |
| Equity tax |
| 668,231 |
| - |
| - | | Total liabilities |
| 8,867,369 |
| 20,947,508 |
| 15,030,781 |
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| | Shareholders' equity |
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| Share capital |
| 140,483,641 |
| 114,438,212 |
| 90,982,867 |
| Contributed surplus |
| 21,168,550 |
| 13,141,128 |
| 6,375,913 |
| Reserves |
| 492,924 |
| (3,207,116) |
| - |
| Deficit |
| (76,125,884) |
| (44,206,637) |
| (17,913,997) |
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| 86,019,231 |
| 80,165,587 |
| 79,444,783 | | Total liabilities and shareholders' equity | $ | 94,886,600 | $ | 101,113,095 | $ | 94,475,564 |
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PETROAMERICA OIL CORP.
Consolidated Statements of Comprehensive Loss
(Expressed in Canadian dollars)
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| 2011 |
| 2010 | | Revenue |
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| Oil revenue - net of royalties |
| $ | 10,454,251 | $ | - |
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| 10,454,251 |
| - | | Expenses |
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| Production |
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| (2,887,282) |
| - |
| Exploration and evaluation |
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| (24,048,883) |
| (19,009,381) |
| Depreciation, depletion & amortization |
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| (3,313,733) |
| (4,574) |
| General and administration |
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| (7,453,893) |
| (6,294,053) |
| Share-based payments |
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| (3,764,191) |
| (2,792,279) |
| Other Expense |
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| (1,485,092) |
| - |
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| (42,953,074) |
| (28,100,287) |
| Interest income |
|
| 732,444 |
| 536,584 |
| Gain on marketable securities |
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| - |
| 2,764,291 |
| Interest and financing fees |
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| (184,121) |
| (554,255) |
| Foreign exchange gain |
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| 258,251 |
| (176,042) |
| Loss from equity investments |
|
| - |
| (242,814) |
| Loss on disposal of investments |
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| (1,674,353) |
| - |
| Loss on disposal of assets |
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| - |
| (7,800,000) |
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| (867,779) |
| (5,472,236) | | Loss before income taxes |
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| (33,366,602) |
| (33,572,523) | | Current income and equity tax |
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| - |
| (117) | | Deferred tax recovery |
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| 1,447,355 |
| 7,280,000 | | Net loss for the period |
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| (31,919,247) |
| (26,292,640) | | Other comprehensive income (loss) |
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| | Reserve on translation of and on net investments in foreign operations |
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| 2,415,890 |
| (1,922,966) | | Net change in fair value of available-for-sale investments |
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| 1,284,150 |
| (1,284,150) | | Other comprehensive income (loss) |
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| 3,700,040 |
| (3,207,116) | | Total comprehensive loss |
| $ | (28,219,207) | $ | (29,499,756) | | Basic and diluted loss per share |
| $ | (0.06) | $ | (0.07) | | Weighted average number of basic and diluted common shares outstanding |
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| 521,900,717 |
| 352,950,250 |
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| PETROAMERICA OIL CORP.
Consolidated Statements of Changes in Equity
(Expressed in Canadian dollars)
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| Share
Capital |
| Contributed
surplus |
| Investment
revaluation
reserve |
| Translation
reserve |
| Deficit |
| Total equity | | Balance at January 1, 2011 |
| $ | 114,438,212 | $ | 13,141,128 | $ | (1,284,150) | $ | (1,922,966) | $ | (44,206,637) | $ | 80,165,587 | | Net loss for the year |
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| - |
| - |
| - |
| - |
| (31,919,247) |
| (31,919,247) | | Other comprehensive loss |
|
| - |
| - |
| 1,284,150 |
| 2,415,890 |
| - |
| 3,700,040 | | Total comprehensive loss |
|
| - |
| - |
| 1,284,150 |
| 2,415,890 |
| (31,919,247) |
| (28,219,207) |
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| | Issuance of Share Capital |
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| 26,846,161 |
| 4,753,739 |
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| 31,599,900 | | Transaction costs |
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| (1,499,349) |
| (284,391) |
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| (1,783,740) | | Share-based payments |
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| 698,617 |
| 3,558,074 |
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| 4,256,691 | | Balance at December 31, 2011 |
| $ | 140,483,641 | $ | 21,168,550 | $ | - | $ | 492,924 | $ | (76,125,884) | $ | 86,019,231 |
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| Share
Capital |
| Contributed
surplus |
| Fair value
reserve |
| Translation
reserve |
| Deficit |
| Total equity | | Balance at January 1, 2010 |
| $ | 90,982,867 | $ | 6,375,913 | $ | - | $ | - | $ | (17,913,997) | $ | 79,444,783 | | Net loss for the year |
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| - |
| - |
| - |
| - |
| (26,292,640) |
| (26,292,640) | | Other comprehensive loss |
|
| - |
| - |
| (1,284,150) |
| (1,922,966) |
| - |
| (3,207,116) | | Total comprehensive loss |
|
| - |
| - |
| (1,284,150) |
| (1,922,966) |
| (26,292,640) |
| (29,499,756) |
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| | Issuance of Share Capital |
|
| 23,865,158 |
| 4,884,842 |
| - |
| - |
| - |
| 28,750,000 | | Transaction costs |
|
| (1,871,919) |
| (423,937) |
| - |
| - |
| - |
| (2,295,856) | | Share-based payments |
|
| 1,462,106 |
| 2,304,310 |
| - |
| - |
| - |
| 3,766,416 | | Balance at December 31, 2010 |
| $ | 114,438,212 | $ | 13,141,128 | $ | (1,284,150) | $ | (1,922,966) | $ | (44,206,637) | $ | 80,165,587 |
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PETROAMERICA OIL CORP.
Consolidated Statements of Cash Flows
(Expressed in Canadian dollars)
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| 2011 |
| 2010 | | Operating Activities |
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| | Net loss for the period |
| $ | (31,919,247) | $ | (26,292,640) | | Items not involving cash: |
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| Share-based payments |
|
| 3,764,191 |
| 2,887,466 |
| Depreciation, depletion & amortization |
|
| 3,313,733 |
| 4,574 |
| Loss from equity investments |
|
| - |
| 242,814 |
| Loss from disposal of assets |
|
| - |
| 7,800,000 |
| Loss (gain) on marketable securities |
|
| 1,674,353 |
| (2,764,291) |
| Deferred tax recovery |
|
| (1,447,355) |
| (7,280,000) |
| Unrealised foreign exchange loss (gain) |
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| 2,289,276 |
| (1,062,253) |
| Impairment of exploration & evaluation assets |
|
| 10,244,787 |
| 10,002,269 |
| Equity tax expense, net of cash payments |
|
| 1,072,934 |
| - | | Net changes in non-cash working capital balances: |
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| Changes in trade and other receivables |
|
| (7,020,629) |
| (1,525,067) |
| Changes in inventories |
|
| (31,646) |
| (531,884) |
| Changes in accounts payable |
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| 3,626,683 |
| (2,061,790) | | Cash used in operating activities |
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| (14,432,920) |
| (20,580,802) | | Investing activities |
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| | Exploration & evaluation expenditures |
|
| (10,315,907) |
| (24,819,423) | | Property, plant and equipment |
|
| (19,691,697) |
| (99,875) | | Proceeds on sale and farm out |
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| 10,678,500 |
| - | | Interest received |
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| 691,858 |
| 336,968 | | Payment for assets relinquished |
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| (6,800,000) |
| (1,000,000) | | Restricted cash investments |
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| 2,300,000 |
| (2,289,851) | | Proceeds on marketable securities |
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| 2,441,347 |
| 3,452,605 | | Cash used in investing activities |
|
| (20,695,899) |
| (24,419,576) | | Financing activities |
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| | Proceeds on exercise of stock options |
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| 492,500 |
| 878,950 | | Issuance of common shares, net of costs |
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| 29,816,160 |
| 26,454,144 | | Loan to Petro Vista |
|
| - |
| (3,037,614) | | Repayment of Petro Vista loan |
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| - |
| 3,042,878 | | Cash provided by financing activities |
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| 30,308,660 |
| 27,338,358 | | Effect of foreign exchange rate on cash held |
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| 2,990 |
| 82,392 | | Increase (decrease) in cash during the period |
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| (4,817,169) |
| (17,662,020) | | Cash and cash equivalents, beginning of period |
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| 24,111,723 |
| 41,691,354 | | Cash and cash equivalents, end of period |
| $ | 19,294,554 | $ | 24,111,723 | | Cash interest paid |
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| - |
| - | | Cash taxes paid |
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| - |
| 117 |
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| Petroamerica is a junior oil and gas company operating in Colombia and its shares are listed on the TSX Venture Exchange under the symbol "PTA".
Forward Looking Statements:
This news release includes information that constitutes "forward-looking information" or "forward-looking statements". More particularly, this news release contains statements concerning expectations regarding the timing of test results from the Balay-3 well, regulatory and partner approvals on the Company's development plan, drilling and operational opportunities and production revenues in addition to the potential exploration and development opportunities and expectations regarding regulatory approval and the strategic direction of the Company. The forward-looking statements contained in this document, including expectations and assumptions concerning the obtaining of the necessary regulatory approvals, including ANH approval, and the assumptions, opinions and views of the Company or cited from third party sources, are solely opinions and forecasts which are uncertain and subject to risks. A multitude of factors can cause actual events to differ significantly from any anticipated developments and although the Company believes that the expectations represented by such forward-looking statements are reasonable, undue reliance should not be placed on the forward-looking statements because there can be no assurance that such expectations will be realized. Material risk factors include, but are not limited to: the inability to obtain regulatory approval, including ANH approval, for the transfer of participating interests, the risks of the oil and gas industry in general, such as operational risks in exploring for, developing and producing crude oil and natural gas, market demand and unpredictable shortages of equipment and/or labour; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; fluctuations in oil and gas prices, foreign currency exchange rates and interest rates, and reliance on industry partners.
Neither the Company nor any of its subsidiaries nor any of its officers, directors or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does any of the foregoing accept any responsibility for the future accuracy of the opinions expressed in this document or the actual occurrence of the forecasted developments.
The forward-looking statements contained in this document are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of 6,000 cubic feet:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. |
