Markets

Tuscany Announces Significant Production and Revenue Gains for 2012, Exited Year With No Debt

Tuscany Energy (TUS.V) today provided an update on its activitiees.

Operations

During 2012, Tuscany drilled three horizontal heavy oil wells at its Macklin, Saskatchewan field. The Company now has a total of 19 (net 11.05) horizontal heavy oil wells producing from its key fields in Saskatchewan, with 12 wells at Evesham (7.2 net wells) and 7 wells at Macklin (3.85 net wells).

At the Evesham field, third quarter water disposal upgrading encompassed the deepening and re-completion of a vertical well for water disposal and the connection of this well by pipeline to existing infrastructure. The Macklin expansion in the third quarter included the tie in of an existing water disposal well to the main battery, by pipeline, and reconfiguration of the battery.

As a result of continuing weak heavy oil prices in 2013, Tuscany reports that it has deferred drilling operations until late spring. The Company plans to further increase its ability to handle water at the Evesham field which will result in increased fluid production and ultimately an increase in oil production early this year.

Financial

For the year ended December 31, 2012, revenues increased to $7.5 million compared with $6.1 million in the prior year. Cash flow from operations decreased to $2.7 million from $3.2 million in 2011, due to higher operating costs.

For the three month period, Tuscany's revenues net of royalties decreased to $1.7 million compared with $2.5 million in Q4 2011. This decrease was primarily due to a decline in oil prices compared with Q4 2011, and a reduction of processing fee revenues, partially offset by increased oil and gas production.

Cash flow from operations for Q4 2012 decreased to $796,000 compared with $1.7 million in Q4 2011. The decrease in cash flow resulted primarily from a drop in heavy oil prices from $87.78 per barrel to $61.81 per barrel during the quarter.

Tuscany incurred $256,000 of net capital expenditures during the quarter compared with $3.0 million for Q4 2011. For the year ended December 31, 2012, net capital spending was $4.0 million compared with $7.8 million in the prior year. Capital expenditures for the three and twelve month periods ended December 31, 2012, were financed from cash flow from operations, proceeds from sales of Magnum Hunter shares, and non-core property sales.

At December 31, 2012, Tuscany had positive working capital of $380,000 compared with net debt of $447,000 at the beginning of the year. The Company also had access to a credit facility of $8.5 million, which remained undrawn.

Production

For the year ended December 31, 2012, the company's average production increased to 354 BOEd from 247 BOEd in the prior year. The Company's average Q4 2012 production increased to 372 BOEd compared with 332 BOEd in Q4 2011.

Tuscany closed at a yr low of 5 cents.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Commodities

Latest Markets Videos

MTNewswires

Founded in 1999, MT Newswires (formerly known as Midnight Trader) is a leading provider of original source, multi-asset class, real-time, global financial news and information to most of the largest banks, brokerage firms and professional market data, trading & research applications in North America.

Learn More