Nextraction Briefs 2Q11 Results
Nextraction has filed consolidated financial statements and related management's discussion and analysis for the period ended June 30, 2011 which are can be found under the Company's profile on SEDAR. All amounts herein are reported in Canadian dollars unless otherwise noted.
Mark S. Dolar, Company President and CEO stated, "Corporate and asset growth has been our primary focus in the first half of 2011. We established our Calgary office, hired a dynamic management team to execute our growth strategy, acquired producing properties and commenced drilling our initial horizontal well in the Viking formation of eastern Alberta. In the second quarter of 2011 we encountered several one-time capital expenditures required for the growth of a company of our size. With these costs now behind us, we look forward to improving our balance sheet and generating shareholder value through developing the assets in our inventory."
Nextraction's operating and financial highlights for the second quarter include:
- Nextraction continued to execute on its strategy of shifting towards an oil-focused company.
- Second quarter Production averaged 64 boe per day weighted 32% light oil and natural gas liquids and 68% natural gas, compared to average production of 75 boe per day weighted 13% light oil and natural gas liquids and 87% natural gas in the first quarter of 2011. Averaged production volumes for the second quarter were lower as approximately 55 boe per day being shut-in for the first half of the quarter as a result of adding facilities required for regulatory compliance and work over activities.
- Total revenues increased 23% to $253,098 from $205,377 in the first quarter of 2011, due to a 100% increase in average oil production combined with a 21% increase in the average realized price of oil.
- Exited the second quarter of 2011 with no debt, positive working capital position of $4,149,217 and subsequently secured a commitment from a shareholder group to provide a $1,500,000 credit facility.
The Company is currently completing its first well on its Viking light oil prospect in the area of Provost, Alberta, with production expected to come on stream in the third quarter of 2011. Initial flow-back rates for this well are encouraging and exceed management's expectations to date. The Company plans to follow up with a second well in late third quarter of 2011.
The Company plans to focus its attention on developing the Provost Viking light oil project, located in east central Alberta. The initial horizontal well in the play has been drilled and is currently in final completion stages. The well was drilled to a depth of 820 meters with a 1,200 meter horizontal leg in the Viking zone, and was completed with a 13 stage fracture treatment. The Company plans to drill a second well in the pool after completion of the initial well. The Company has identified a further 19 Gross locations on the acreage and hopes to accelerate further drilling assuming results from the first two wells support such action.