Bellamont Exploration Ltd. releases first quarter 2010 financial and
operating results
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
CALGARY, May 27 /CNW/ - Bellamont Exploration Ltd. (the "Corporation" or "Bellamont") (TSXV:BMX.A) (TSXV:BMX.B) is pleased to provide a summary of its financial and operating results for the three months ended March 31, 2010.
FIRST QUARTER 2010 HIGHLIGHTS
- First quarter funds generated from operations increased 189% to $3.4
million from $1.2 million in the fourth quarter of 2009;
- Increased average production to 1,731 Boe/d in the first quarter, an
increase of 98% from the fourth quarter of 2009;
- Increased operating netback to $26.71/Boe, an increase of 118% from
the same period in 2009 and a 33% increase from the fourth quarter of
2009;
- Average operating expenses of $11.90/Boe were recorded in the first
quarter, a decrease of 12% from the fourth quarter of 2009;
- During the first quarter, the Corporation drilled 4 (3.5 net) wells,
which to date, has resulted in:
- 3 (2.5 net) completed oil wells; and,
- 1 (1 net) potential oil well;
- Closed the acquisition of Standard Energy Inc. on February 11, 2010.
Total consideration paid by Bellamont was $54.45 million;
- Closed a bought-deal financing agreement pursuant to which the
Corporation issued 25,000,000 Class A shares for gross proceeds of
$20.0 million; and,
- Secured a $32.0 million revolving operating demand loan which was
increased to $42.5 million subsequent to March 31, 2010.
FINANCIAL AND OPERATING HIGHLIGHTS
The Corporation will file its unaudited financial statements and related management's discussion and analysis ("MD&A") for the three months ended March 31, 2010, with Canadian securities regulatory authorities on SEDAR. Copies of these documents may be accessed electronically on SEDAR at www.sedar.com or at www.bellamont.com. Certain selected financial and operational information for the three months ended March 31, 2010, December 31, 2009 and March 31, 2009 are set out below and should be read in conjunction with Bellamont's financial statements and MD&A.
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March 31, December 31, March 31,
Three Months Ended 2010 2009 2009
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FINANCIAL ($000s, except per share)
Petroleum and natural gas sales 7,503 3,390 2,251
Funds generated from operations(1) 3,394 1,176 359
Per share basic and diluted 0.03 0.02 0.01
Net loss (783) (670) (1,383)
Per share basic and diluted (0.01) (0.01) (0.03)
Net capital expenditures(2) 63,260 25,379 2,614
Net debt(1)/(working capital surplus) 15,171 3,490 (2,235)
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OPERATING
Production
Crude Oil (Bbls per day) 617 271 201
Natural gas (Mcf per day) 6,297 3,501 3,039
Natural gas liquids (Bbls per day) 65 21 10
Total (Boe per day) 1,731 875 717
Average realized prices
Crude Oil ($ per Bbl) 76.57 71.44 45.68
Natural gas ($ per Mcf) 5.08 4.65 5.05
Natural gas liquids ($ per Bbl) 64.70 60.23 47.25
Average realized price ($ per Boe) 48.17 42.13 34.86
Netbacks(1) ($ per Boe)
Petroleum and natural gas sales 48.17 42.13 34.86
Royalties (8.43) (7.50) (7.50)
Operating expenses (11.90) (13.46) (13.50)
Transportation expenses (1.13) (1.12) (1.60)
Operating netback 26.71 20.05 12.26
Undeveloped land holdings
Gross acres 97,123 64,531 68,118
Net acres 64,712 41,573 40,715
Average working interest 67% 64% 60%
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COMMON SHARES (000s)
Shares outstanding, end of period
Class A shares 140,788 81,861 44,649
Class B shares 1,012 1,012 1,012
Weighted average shares
Basic and diluted(3) 123,409 76,595 54,769
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(1) Funds generated from operations, Net debt and Netbacks as presented
do not have any standardized meaning prescribed by Canadian GAAP and
therefore may not be comparable with the calculation of similar
measures for other entities. Please refer to the Non-GAAP Measures
section of the MD&A for more details.
(2) Total net capital expenditures, including acquisitions.
(3) For the three months ended March 31, 2010 the Class B shares are
converted at the minimum Class A share price of $1.00 and added to
the Class A shares. Thus each Class B share converted to 10 Class A
shares for the basic and diluted share calculation.
AREA UPDATES
Grande Prairie
At the Grande Prairie property acquired from Standard, Bellamont drilled, cased and completed via multi-stage fracture stimulation a horizontal step-out well (100% working interest) in the Grande Prairie Montney I Oil pool. The wells in this pool produce oil with a high ratio of liquids rich associated natural gas. The new well was placed on restricted production at the end of April and to date has produced an average of approximately 135 bbl/d of light oil and natural gas liquids together with another 1.56 mmcf/d of natural gas for a combined total of 395 boe/d. Since the acquisition in February, the production from this property has increased by 25%. Bellamont has three additional licensed oil wells to drill in 2010 in this area, 1 (1 net) targeting the Montney I pool and 2 (2 net) targeting light oil in the Dunvegan Formation.
Grimshaw
The Corporation now has four wells (one vertical and three horizontals) on production in its Montney oil pool discovery at Grimshaw. In the first quarter, the Corporation has drilled and cased a fourth horizontal oil well (100% working interest) which has been successfully completed via multi-staged fracture stimulations as a Montney oil well. This well encountered 1,275 meters of reservoir and tested comparably to the offsetting producers, the best of which produced an average in excess of 150 Boe/d over its first 60 days of production. Bellamont is planning on building a multi-well battery this summer which will centralize production operations for all its producing wells, including the newly completed well. Bellamont plans to drill 3 additional (2.5 net) wells in this oil pool by year end, the first of which will be spud after spring break-up.
Rycroft
Bellamont has drilled and cased a vertical well (100% working interest) as a potential Montney oil well in the first quarter. This well was drilled to delineate Bellamont's Montney light (39 degrees API) oil pool discovery in the area and will be completed after spring breakup. A successful completion of this well would extend the current pool boundaries significantly and is expected to lead to a multi-well horizontal development plan. Two horizontal wells drilled by a competitor in an analogous Montney oil pool located approximately 6 miles south of Bellamont's discovery are producing an average of 197 Boe/d (85.0% oil) after five months of production.
Pembina
On another property acquired in the Standard acquisition, the Corporation has drilled, cased and completed a second Cardium oil well (52% working interest). The well has averaged approximately 90 boe/d in its first thirty days of production since load fluid was recovered.
OUTLOOK
Bellamont has now successfully integrated its operations with Standard and has been active drilling wells on the combined asset base. Based on successful drilling to date, the company has increased its production guidance for the full year to 2,300 Boe/d and year end exit to 2,750 Boe/d. Bellamont's capital budget of $35 MM is weighted towards oil projects, which will continue to increase the Corporation's oil weighting and netback through the year.
Bellamont's strategy is to build a low risk reserve, production and cash flow base through acquiring, developing and exploring primarily in the Peace River Arch area of Alberta. Bellamont has a strong technically focused management team that internally generates and develops high quality large resource based prospects. The Company has a drilling inventory of 90 wells (71 net). In addition, the Company has compiled an undeveloped land inventory of 97,123 gross acres (64,712 net), of which 73,201 gross acres (53,874 net) is located in the Peace River Arch area of Alberta.
Bellamont is an oil and gas company focused on the acquisition, exploration, development and production of oil and natural gas in western Canada and trades on the TSX Venture Exchange under the symbols "BMX.A" and "BMX.B". The Corporation has 140,787,690 Class A shares and 1,012,000 Class B shares outstanding.
SEPAC OIL & GAS INVESTOR SHOWCASE
Bellamont will be presenting at the SEPAC Oil & Gas Investor Showcase on Thursday June 3, 2010 at 10:40 a.m. at The Westin Calgary, 320 -4th Avenue S.W. Calgary, Alberta. In conjunction with this presentation the Corporation will be updating its corporate presentation incorporating its most current budget and results, a copy of which will be posted on the Corporations' webpage at www.bellamont.com.
ANNUAL MEETING
Bellamont's annual shareholder meeting will be held at 3:00 p.m. on June 3, 2010 in the Plaza Room at the Metropolitan Centre, 333 Fourth Avenue S.W., Calgary Alberta.
FORWARD LOOKING STATEMENTS
This press release may contain forward-looking statements including expectations of future production, cash flow and earnings. More particularly, this press release contains statements concerning Bellamont's future production estimates, expansion of oil and gas property interests, exploration and development drilling and capital expenditures. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to: the risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price, price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Additional information on these and other factors that could affect Bellamont's operations or financial results are included in Bellamont's reports on file with Canadian securities regulatory authorities.
The forward-looking statements or information contained in this news release are made as of the date hereof and Bellamont undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
OIL AND GAS ADVISORY
This press release contains disclosure expressed as "Boe/d". All oil and natural gas equivalency volumes have been derived using the ratio of six thousand cubic feet of natural gas to one barrel of oil. Equivalency measures may be misleading, particularly if used in isolation. A conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head.
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.
Not for distribution to U.S. newswire services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. securities law.
%SEDAR: 00024373E
For further information: Steve Moran, President and Chief Executive Officer, (403) 802-1355; 200, 1324-17th Avenue S.W. Calgary, Alberta, T2T 5S8, Email: [email protected], www.bellamont.com
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