VANCOUVER, BC, May 23, 2022
/CNW/ - ShaMaran Petroleum Corp. ("ShaMaran" or the
"Company") (TSXV: SNM) (Nasdaq First North Growth Market
(Sweden): SNM) today released its
financial and operating results and related management's discussion
and analysis (MD&A) for the three months ended March 31, 2022¹. View PDF version.
Dr. Adel Chaouch, President and
Chief Executive Officer of ShaMaran, commented "We kicked off 2022
with another very strong set of results, further improving on Q4
2021. During the first quarter of 2022 the Company achieved a new
record in oil sales revenues of $38.8
million, 88% higher than the first quarter of 2021, as well
as record cash flows from operations of $23.8 million, nearly five times that of the same
quarter last year. ShaMaran's Q1 2022, EBITDAX² was more than
double that of Q1 2021, continuing to demonstrate the Company's
strong profitability in the current oil price environment.
We are excited about the upcoming closing of the Sarsang
Acquisition and the impact it will have on the Company. By year end
2022 the combined business is forecast to have an unrestricted cash
balance between $130 million and
$150 million based on Brent oil
prices of $90 to $100 per barrel. In addition to this the Company
will have $36 million held as
restricted cash in line with the 2025 Bond Terms, resulting in year
end 2022 leverage below 1x net debt to EBITDAX. This rapid
deleveraging will enable ShaMaran to continue being active in
seeking further growth through accretive acquisitions like Sarsang.
Finally, we have successfully concluded the rights offering in
Sweden and Canada and will provide details in due
course."
Atrush Financial Highlights
|
Three months ended
March 31
|
USD
Thousands
|
2022
|
2021
|
Revenue
|
38,836
|
20,606
|
Gross margin on oil
sales
|
27,679
|
10,254
|
Net result
|
15,080
|
2,469
|
Cash flow from
operations
|
23,762
|
5,285
|
EBITDAX
|
30,471
|
13,500
|
- The Company delivered oil sales in Q1 2022 of $38.8 million, the highest ever quarterly oil
sales revenue;
- Cash flow from operations for Q1 2022 were a record
$23.8 million, nearly five times that
of Q1 2021;
- EBITDAX in Q1 2022 was very strong at $30.5 million, more than double the EBITDAX of Q1
2021; and
- The Kurdistan Regional Government ("KRG") has repaid
$34.71 million of overdue receivables
for November 2019 to February 2020, the remaining $6.99 million is expected to be paid by the end
of Q2 2022.
Atrush Operational Highlights
- Average production of approximately 38,812 bopd in Q1 2022,
similar to Q1 2021 production of 38,212 bopd and within the 2022
guidance;
- Q1 2022 lifting costs per barrel of $5.53 is slightly higher than Q1 2021 lifting
costs of $5.12 per barrel. This
slight increase is mainly due to higher diesel prices but within
our 2022 guidance which takes into account cost inflation; and
- The CK-16 well was spudded in March
2022. The primary purpose of the CK-16 well is to serve as a
water injection well, providing additional capacity and redundancy
to CK-9, the first Atrush water injection well. The CK-16 well
reached TD ahead of schedule on May 20,
2022, and the well is currently being logged.
Sarsang Acquisition
- In July 2021 the Company began
the implementation of its growth plans by signing an agreement to
acquire an affiliate of TotalEnergies S.E. ("TTE") holding an 18%
participating interest in Sarsang block. During Q1 2022, the
Company made progress toward the closing of this acquisition
through engagement with representatives of the KRG and TTE and the
closing is now expected in Q2 2022;
- As announced on July 30, 2021,
the Company has successfully issued and settled $111.5 million principal amount of the
$300 million 12% senior unsecured
bond 2021/2025 (the "2025 Bond"). This portion of the 2025 Bond and
the $188.5 million balance will be
issued to refinance existing indebtedness of the Company in
connection with, and conditional upon completion of, the Company's
acquisition of the 18% non-operated participating interest in the
Sarsang block; and
- Following the closing of the Sarsang Acquisition, the combined
business is forecasted to result in a 2022 year end unrestricted
cash balance between $130 million and
$150 million based on Brent oil
prices of $90 to $100 per barrel. This cash balance combined with
the $36 million held as restricted
cash in line with the 2025 Bond agreement will result in leverage
below 1x net debt to EBITDAX at year end 2022.
OTHER
This information is information that ShaMaran is obliged to make
public pursuant to the EU Market Abuse Regulation. The information
was submitted for publication, through the agency of the contact
persons set out below, on May 23,
2022 at 5:30 p.m. Eastern
Time. Arctic Securities AS (Swedish branch) is the
Company's Certified Advisor on Nasdaq First North Growth Market
(Sweden), +46 844 68 61 00,
certifiedadviser@arctic.com.
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.
FORWARD LOOKING STATEMENTS
This news release contains statements and information about
expected or anticipated future events and financial results that
are forward‐looking in nature and, as a result, are subject to
certain risks and uncertainties, such as legal and political risk,
civil unrest, general economic, market and business conditions, the
regulatory process and actions, technical issues, new legislation,
competitive and general economic factors and conditions, the
uncertainties resulting from potential delays or changes in plans,
the occurrence of unexpected events and
management's capacity to execute
and implement its future plans.
The Covid-19 virus as well as the Russia-Ukraine conflict and the restrictions and
disruptions that followed have had a drastic adverse effect on the
world demand for, and prices of, oil and gas as well as the market
price of the shares of oil and gas companies generally, including
the Company's common shares. There can be no assurance that
these adverse effects will not continue or that commodity prices
will not decrease or remain volatile in the future. These
factors are beyond the control of ShaMaran and it is difficult to
assess how these, and other factors, will continue to affect the
Company and the market price of ShaMaran's common shares. In
light of the current situation, as at the date of this news
release, the Company continues to review and assess its business
plans and assumptions regarding the business environment, as well
as its estimates of future production, cash flows, operating costs,
and capital expenditures.
Any statements that are contained
in this news release that are not statements of
historical fact may be deemed to be forward‐looking information.
Forward‐ looking information typically contains statements with
words such as "may", "will", "should", "expect", "intend", "plan",
"anticipate", "believe", "estimate", "projects", "potential",
"scheduled", "forecast", "outlook", "budget" or the negative
of those terms or similar
words suggesting future outcomes. The Company cautions
readers regarding the reliance placed by them on
forward‐looking information as by its nature, it is based on
current expectations regarding
future events that involve a number of assumptions, inherent
risks and uncertainties, which could cause
actual results to differ materially from those anticipated by
the Company.
Actual results may differ materially from those projected by
management. Further, any forward‐looking information is made only
as of a certain date and the Company undertakes no obligation to
update any forward‐ looking information or statements to reflect
events or circumstances after the date on which such statement is
made or reflect the occurrence of unanticipated events, except as
may be required by applicable securities laws. New factors
emerge from time to time, and it is not possible for management of the Company
to predict all of these factors and to assess
in advance the impact of each such factor on the Company's business
or the extent to which any factor, or combination of factors, may
cause actual results to differ materially from those contained in
any forward‐looking information.
ABOUT SHAMARAN
ShaMaran is a Kurdistan focused
oil development and exploration company which holds a 27.6% working
interest, through its wholly-owned subsidiary General Exploration
Partners, Inc., in the Atrush Block and, upon successful closing of
the Sarsang Acquisition, will then also hold an 18% interest
through its then wholly-owned subsidiary TEPKRI Sarsang A/S in the
Sarsang Block.
ShaMaran is a Canadian oil and gas company listed on the TSX
Venture Exchange and the Nasdaq First North Growth Market
(Sweden) under the symbol
"SNM".
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¹ All currency amounts
indicated as "$" in this news release are expressed in United
States Dollars.
|
² Earnings before
interest, tax, depreciation, amortization, and exploration
expense.
|
SOURCE ShaMaran Petroleum Corp.