Anderson Energy Ltd. (AXL.TO) today reported its operating and financial results for the fourth quarter and year ended December 31, 2012.
- The Company completed its Cardium horizontal light oil winter drilling program using slick water frac technology. Initial production results were vastly superior to previously used fracture stimulation techniques. The average initial production rate over the first 30 days for the seven wells that used this technology was 455 BOED. With the completion of the Company's winter drilling program, all of its drilling commitments have been fulfilled.
- Anderson closed all of the previously announced property dispositions prior to year end. Approximately $74 million in properties were sold during 2012.
Bank debt was reduced significantly to $48.1 million at December 31, 2012 ($88.7 million - 2011) and bank loans plus cash working capital deficiency was reduced to $64.5 million ($132.7 million - 2011).
- Funds from operations were $5.7 million for the fourth quarter of 2012 and $29.6 million for the year ended December 31, 2012.
- Production in the fourth quarter of 2012 was 4,500 BOED, which includes 645 BOED related to properties sold in the quarter. Net of all of the properties sold, the Company estimates first quarter 2013 production to be approximately 3,900 to 4,200 BOED (43% oil and NGL).
STRATEGIC ALTERNATIVES
The Company is continuing its process to identify, examine and consider a range of strategic alternatives available to the Company with a view to enhancing shareholder value. The strategic alternatives may include, but are not limited to, a sale of all or a material portion of the assets of Anderson, or a drilling joint venture, either in one transaction, or in a series of transactions, the outright sale of the Company, or a merger or other strategic transaction involving Anderson and a third party.
Financial Results
The Company recorded a loss of $8.9 million in the fourth quarter of 2012 compared to a loss of $32.2 million in the fourth quarter of 2011. Anderson's operating netback was $26.50 per BOE in the fourth quarter of 2012 compared to $29.88 per BOE in the fourth quarter of 2011. The decrease in the operating netback was primarily due to the decrease in oil and NGL prices and oil volumes. Anderson's operating netback for its Cardium horizontal properties in the year ended December 31, 2012 was $44.73 per BOE compared to $6.07 per BOE for the remainder of its properties (exclusive of hedging). Anderson's operating netback for its Cardium properties was $44.32 per BOE in the fourth quarter of 2012.
Anderson is near a yr low.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
