Porto Energy Corp., (PEC.V), which is trading at year low
levels, recorded net losses for the three months ended May 31, 2012
of US$1.51 million, compared with $2.18 million for the comparative
period in 2011. As the company is in the exploration phase of
operations, there are currently no oil and natural gas producing
properties generating revenues.
The company's net losses were impacted by G&A expenses
including salaries, office costs and travel costs in addition to
professional fees and share-based payments. The fair value of the
share-based payments was a non-cash expense.
The company recorded a comprehensive loss for the three months
ended May 31, 2012 of $1.47 million, compared with a comprehensive
loss of $2.24 million for the three months ended May 31, 2011. The
difference between net loss and comprehensive loss is comprised of
the non-recurring gain on the settlement of debt and the provisions
for income taxes.
2012 Work Program
The company received approval from the DPEP, for its modified
2012 work program in May 2012. However, following the drilling
results in the reef wells as well as the re-entry well, and based
on the timing of the interpretation of the recently completed
Montejunto 3-D seismic data acquisition, the company and DPEP
agreed to modify the Porto work program commitments going forward,
with a near term focus on the evaluation of the Lias stratigraphic
interval, which Porto has identified as an unconventional resource
throughout its concessions. Under the 2012 work program, the
company will drill 19 shallow wells testing the Lias and two
additional deep wells targeting the Presalt and possibly the
Aljubarrota gas discovery. All 19 Lias wells are being undertaken
as part of the JV with Sorgenia and RAG, for which they will carry
Porto. The two deep wells include a Presalt well, the ALC-1 and,
depending on the results of that initial well, the Alj-5 well to
further evaluate the Aljubarrota gas discovery. The total cost for
these wells is expected to be approximately US$14.0 million and are
anticipated being funded, in part, by joint venturing efforts.
Receipt of the approval from the DPEP ensures that Porto will
remain in good standing with the government and will be able to
meet its obligations under the concession agreements.
The company has discovered reservoir, porosity and permeability
throughout the basin. It is now in search of geologic traps that
provide improved chances of finding hydrocarbons.