CALGARY, ALBERTA--(Marketwire - July 16, 2012) - Petrobank Energy and Resources Ltd. (News - Market indicators) reports second quarter 2012 production at our Kerrobert THAI® project was 236 barrels of oil per day ("bopd"). This is an increase from first quarter 2012 production of 193 bopd. These production volumes represent actual sale volumes for each period reported. We have updated our corporate presentation with additional production information and a copy is now available at www.petrobank.com.
Wet weather in June negatively impacted production by preventing movement of service rigs needed for workovers on several of our wells. However, during this period, we were able to maintain steady THAI® oil production. We expect that oil production will continue to rise as we maintain our balanced approach of building out the THAI® combustion front.
As previously reported, we have identified multiple opportunities to utilize some of the existing wells on our Saskatchewan lands for conventional cold heavy oil production. We expect to initiate this production on five wells by early-August.
At our Dawson project in Alberta, we are waiting on regulatory approval to initiate cold production on the two-well demonstration project to condition the reservoir prior to initiating THAI® operations.
We are pleased to report that we have recently completed our Normal Course Issuer Bid ("NCIB") and repurchased our approved limit of 7,273,401 Petrobank shares at a cost of approximately $88 million. Petrobank now has approximately 100 million shares issued and outstanding. Petrobank expects to renew our NCIB as soon as permitted under securities regulations. As part of the automatic share repurchase plan in place with our designated broker, we have sold 5.5 million PetroBakken shares for proceeds of $67 million to fund a portion of the Petrobank share repurchases. The sale of one PetroBakken share for each Petrobank share repurchased under this plan resulted in net cash proceeds to Petrobank of approximately $5 million. Petrobank currently owns approximately 108 million PetroBakken shares, including the shares received under PetroBakken's dividend reinvestment plan for the June dividend received today. As a result, the number of PetroBakken shares owned per Petrobank share outstanding has increased to approximately 1.08 from 1.03 at December 31, 2011.
Petrobank remains well capitalized with significant financial flexibility for future operations. Including the Petrobank share repurchase and PetroBakken share sale described above, Petrobank has approximately $95 million of positive net working capital including $103 million of cash and cash equivalents.
Petrobank expects to release second quarter 2012 operating and financial results in the evening of August 13, 2012.
Petrobank Energy and Resources Ltd. is a Calgary-based oil and natural gas exploration and production company with operations in western Canada. The Company operates high-impact projects through two business units and a technology subsidiary. Petrobank's 57% owned TSX-listed subsidiary, PetroBakken Energy Ltd. (TSX:PBN), is an oil and gas exploration and production company combining light oil Bakken and Cardium resource plays with conventional light oil assets. Whitesands Insitu Partnership, a partnership between Petrobank and its wholly-owned subsidiary Whitesands Insitu Inc., applies Petrobank's patented THAI® heavy oil recovery process in the field. THAI® is an evolutionary in-situ combustion technology for the recovery of bitumen and heavy oil. THAI® and CAPRI® are registered trademarks of Archon Technologies Ltd., a wholly-owned subsidiary of Petrobank Energy and Resources Ltd., for specialized methods for recovery of oil from subterranean formations through in-situ combustion techniques and methodologies with or without upgrading catalysts. Used under license by Petrobank Energy and Resources Ltd.
Forward-Looking Statements: Certain information provided in this press release constitutes forward-looking statements. Specifically, this press release contains forward-looking statements relating to future production levels, timing of release of financial results, results from operations timing of certain projects and timing for regulatory filings for future normal course issuer bids. Forward-looking statements are necessarily based upon assumptions and judgments with respect to the future including, but not limited to, the outlook for commodity markets and capital markets, success of future development activities, the successful application of technology, prevailing commodity prices, the performance of producing wells and reservoirs, well development and operating performance, general economic and business conditions, and weather. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: general economic, market and business conditions; fluctuations in oil prices; risks associated with the development and application of early stage technology, recompletions and related activities; availability of equipment and personnel; access to drilling and surface locations due to weather or other factors; fluctuation in foreign currency exchange rates; changes in environmental and other regulations; risks associated with oil and gas operations; and other factors, many of which are beyond the control of the Company. There is no representation by Petrobank that actual results achieved during the forecast period will be the same in whole or in part as those forecast. Except as may be required by applicable securities laws, Petrobank assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.
