Sea Dragon Energy Inc. Second Quarter 2014 Financial and Operating Results

LONDON, England, Aug. 29, 2014 /CNW/ - Sea Dragon Energy Inc. ("Sea Dragon" or the "Company") (TSXV: SDX) announces its 2014 second Quarter Financial and Operating Results (the "Quarter" or "Q2 2014").

Second Quarter 2014 Highlights:

Operational Performance

• Successfully drilled one injection well in the North West Gemsa concession – AASE-22
• Commenced a 10 well work-over program in the North West Gemsa concession to optimize field recovery
• Initiated exploration activity in the South Disouq concession
• Work program commenced in the South Ramadan concession

Financial Performance

• Recorded sales volumes for the quarter of 1,602 boepd, of which oil sales volumes were 1,426 boe/d from both the North West Gemsa and Shukheir Marine concessions (Q2 2013: 1,716 boe/d)
• Recorded funds from operations of US$1.6 MM for the quarter (Q2 2013: US$1.0 MM)
• Maintained Accounts Receivables aging position below 90 days with the exception of the pledged receivables from Shukheir Marine for the South Disouq work program guarantee.
• Exited the quarter with Working Capital of US$6.1 MM

Post Quarter Events

• Entered into a farm-out agreement for 45% equity in the South Disouq concession. In return the Company will receive US$1.9MM in past costs, a full carry on the exploration well commitment and replacement of the work program bank guarantees.

Paul Welch, President & CEO of Sea Dragon commented:

 "During the quarter we have remained focused on creating value from our assets in the Nile Delta and Gulf of Suez. Following a period of consolidation in 2013 and into 2014, we are now well placed to grow the business and create value for shareholders through the current portfolio. The farm out of South Disouq has provided us with the financial flexibility to invest resources across the asset base, particularly at a time when Egypt offers an attractive market for acquisitions and the country has experienced continuous stabilisation of the political environment. I look forward to reporting on our progress in subsequent periods"

KEY FINANCIAL & OPERATING HIGHLIGHTS

				THREE MONTHS ENDED JUNE 30		SIX MONTHS ENDED JUNE 30
	FISCAL YEAR		Prior Quarter (1)	2014	2013	2014	2013
	FINANCIAL $000's
	Cash, end of period		875	1,397	2,232	1,397	2,232
	Working capital		5,747	6,148	6,393	6,148	6,393
	Funds from operations		1,297	1,598	949	2,895	2,910
		per share	0.00	0.00	0.00	0.01	0.01
	Net Income/(Loss)		(1,033)	(249)	(662)	(1,282)	(7,482)
		per share	(0.00)	(0.00)	(0.00)	(0.00)	(0.02)
	Capital expenditures		4,853	1,015	1,635	5,868	3,454
	Total assets		40,026	47,119	43,184	47,119	43,184
	Shareholders' equity		33,363	33,313	34,220	33,313	34,220
	Common shares outstanding (000's)		376,459	376,459	376,459	376,459	376,459
	OPERATIONAL
	Oil sales (bbl/d)		1,489	1,426	1,716	1,449	1,606
	Gas sales (mcf/d)		1,058	927	1,058	987	532
	NGL sales (bbl/d)		22	21	24	21	12
	Total boe/d		1,686	1,602	1,916	1,635	1,706
	Brent oil price ($/bbl)		108.14	109.70	101.47	108.92	106.74
	Realized oil price ($/bbl)		102.31	103.90	97.64	103.08	101.64
	Realized gas price ($/mcf)		1.00	1.00	1.00	1.00	1.00
	Realized NGL price ($/bbl)		72.43	73.58	65.00	73.00	65.00
	Net realized price ($/bbl)		91.86	94.05	88.81	92.92	96.42
	Royalties ($/bbl)		53.60	53.69	45.88	53.64	49.75
	Operating costs ($/bbl)		12.23	10.57	13.76	11.42	13.04
	Netback ($/bbl)		26.02	29.79	29.17	27.85	33.63
	(1) Denotes the three months ended March 31, 2014

Consolidated financial statements with Management's Discussion and Analysis ("MD&A") are now available on the Company's website at www.seadragonenergy.com and on SEDAR at www.sedar.com.

Certain statements contained in this press release constitute "forward-looking statements" as such term is used in applicable Canadian and US securities laws. These statements relate to analyses and other information that are based upon forecasts of future results, estimates of amounts not yet determinable and assumptions of management. In particular, statements concerning the 2014 drilling and capital expenditure programs of the NW Gemsa, Shukheir Marine and South Disouq and the results referenced or implied herein should be viewed as forward-looking statements. 

Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or are not statements of historical fact and should be viewed as "forward-looking statements".  All reserves information contained herein as well as the net present value of such reserves should be considered as forward looking statements. Such forward looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Such risks and other factors include, among others, costs and timing of exploration and production development, availability of capital to fund exploration and development and political, social and other risks inherent in carrying on business in Egypt.  There can be no assurance that such statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements.  Accordingly, readers should not place undue reliance on forward-looking statements contained in this news release.

Forward-looking statements are made based on management's beliefs, estimates and opinions on the date the statements are made and the Company undertakes no obligation to update forward-looking statements and if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable law. Although Sea Dragon has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Investors are cautioned that such forward-looking statements involve risks and uncertainties.  Actual results may differ materially from those currently anticipated.  See Sea Dragon's Annual Information Form for the year ended December 31, 2013 for a description of the risks and uncertainties associated with the Company's business, including its exploration activities. The forward-looking statements contained herein are expressly qualified by this cautionary statement.

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 THE RELEASE.

Notes to Editors

Sea Dragon Energy is an international exploration and development Oil Company with a focus on North Africa. Activities are currently concentrated in Egypt, with interests in three concessions with short- and long-term potential. For further information please see the Company website at www.seadragonenergy.com or the Company's filed documents at www.sedar.com.

SOURCE: Sea Dragon Energy Inc.

Sea Dragon Energy Inc.: Paul Welch, President and Chief Executive Officer, Tel: [phone]; Olivier Serra, Chief Financial Officer, Tel: [phone]; Financial PR: Bell Pottinger, Philip Dennis / Joanna Boon, Tel: [phone]; Investor Relations: Brisco Capital Partners Corp., Scott Koyich, Tel: [phone]