CALGARY, ALBERTA - (Marketwire - Jan. 8, 2010) - Antler Creek Energy Corp ("Antler Creek" or the "Corporation") (TSX VENTURE:AFE) is pleased to release the unaudited financial statements and management discussion and analysis for the three months ended October 31, 2009. The Corporation is a junior oil and gas exploration company whose focus is to explore for and develop oil and gas assets in high netback oil resource plays using horizontal wells and multistage fracturing completion techniques designed to increase the recovery volumes and rates of recovery beyond conventional recovery methods.
Recent Corporate History
The Corporation is the resulting entity formed on May 31, 2009 upon the amalgamation of Antler Creek Energy Corp ("ACEC")(after it had changed its name from Testudo Oil & Gas Exploration Ltd. on May 22, 2009) and Batoche Energy Corp ("BEC"). On May 25, 2009, ACEC acquired all of the issued and outstanding common shares of BEC.
No Comparative Data
Because the fiscal year end of the Corporation (July 31) does not match the fiscal year end of BEC (January 31), and because BEC, as a private corporation, did not prepare certain statistical information, it is not possible to report comparative figures for increases of net asset value ("NAV"), reserve volumes, finding development and acquisition costs ("FD&A"), changes to future development capital ("FDC"), recycle ratios (which measures the return potential for every dollar reinvested given stable netbacks). Certain operational data will be presented for the period from August 1, 2009 to October 31, 2009. Operational data for the period from February 1, 2009 to July 31, 2009 is available in the MD&A filed by the Corporation for the period ended July 31, 2009.
Overall Performance
The unaudited financial statements of the Corporation reflect a gain of $44,811 for the three month period ended October 31, 2009. The financial statements reflect a deficit of $337,153. The financial statements reflect a negative working capital of $18,434 (current assets less current liabilities). The negative working capital does not reflect any reduction of the accounts payable to Aldon Oils Ltd. (joint venture operator) for charges which management believes are not permitted by the joint operating agreement and which credits are estimated to be in excess of $150,000. Subsequent to October 31, 2009, the Corporation became responsible to pay AFE costs of up to $256,000 (25% WI) to frac a Bakken well (1D8-6-2D8 5-9-9-W2M)(South East Saskatchewan, Canada) plus tie in the well to another lease location. The frac was completed by the first week of December. In addition, the Corporation is responsible to pay for its proportionate share (20% WI) to drill, case and complete 2 Bakken wells (Section 13-8-11-W2M) estimated to be $300,000 per well. Both wells were drilled in December. The 1B3-24-4B4 13-8-11-W2M well was fracced on December 6, 2009. The 2A2-24-3A2 13-8-11-W2M well was fracced on January 5, 2010.
The Corporation has non-operated working interests in 8 producing Bakken wells producing from 1,280 gross acres (280 net acres). Six wells are operated by Crescent Point and two by Aldon. Two wells were shut down during the three month period. One was awaiting a workover and the second was being prepped for a frac. Production by the Corporation averaged 22 boe/d for the period from August 1, 2009 to October 31, 2009.
The production for the second quarter ending January 31, 2010 is expected to increase by the end of the period to between 100 boe/d and 200 boe/d (80% oil). The increase in production on a quarterly basis will be a result of the frac of 1D8-6-2D8 5-9-9-W2M, the frac of 2A2-24-3A2 13-8-11-W2M and the frac of 1B3-24-4B4 13-8-11-W2M.
A summary of the balance sheet information is shown below:
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July 31, 2009 October 31, 2009
(Audited) (Unaudited)
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CURRENT ASSETS $ 676,105 $ 537,493
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Petroleum and Natural Gas Properties and
Equipment 2,515,445 2,537,939
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Total Assets $ 3,191,550 $ 3,075,432
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CURRENT LIABILITIES (excluding amounts
due to related party) 368,905 370,632
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Due to Related Party 998,099 835,443
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Future Income Taxes 296,018 296,018
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Asset Retirement Obligation 66,529 66,529
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TOTAL LIABILITIES $ 1,729,571 $ 1,568,642
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Shareholder Capital 1,843,943 1,843,943
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DEFICIT (381,964) (337,153)
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A summary of the income statement information is shown below:
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July 31, 2009 October 31, 2009
(Audited) (Unaudited)
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REVENUE
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Petroleum and Natural Gas Sales $ 178,855 $ 142,221
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Royalties (22,891) (17,543)
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Other Income 7,324
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Interest Income 4,900 103
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$ 160,864 $ 132,105
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Oil and Gas Production Costs 34,286 61,818
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$ 126,578 $ 70,287
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EXPENSES
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Professional Fees (1) 246,767 832
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Stock Based Compensation (2) 51,328
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TSXV Fees and public company costs 24,859
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Office 23,785 7,905
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Rent 5,859 8,572
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Bank Interest and Charges 4,502 201
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Interest on Related Party Debt 20,911 7,966
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Depletion and Depreciation (3) 123,050
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Accretion 581 ------------
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GAIN (LOSS) BEFORE INCOME TAXES $ (375,064) $ 44,811
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Future Income Tax (Reduction) (201,015) ----------
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GAIN (LOSS) $ (174,049) $ 44,811
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Deficit at the Beginning of Period (207,915) (381,964)
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Deficit -- End of Period $ (381,964) $ (337,153)
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Gain (Loss) Per Share Basic and Diluted (0.08) 0.012
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Weighted Number of Shares Outstanding 2,090,849 4,000,000
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Notes:
(1) The sum of approximately $225,000 of these fees reflect the cost
incurred by ACEC to complete its acquisition of BEC and should not be
recurring costs. Legal fees accrued but not billed are not reflected in
unaudited statements.
(2) These costs are non-cash items which resulted when ACEC granted stock
options to its directors concurrent with the acquisition of BEC and when
ACEC granted options to PI Financial Corp as part of a private
placement.
(3) These sums are non cash items.
The average sales price received by for the period from August 1, 2009 to
October 31, 2009 was as follows:
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Category August September October 2009
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Aldon Oils Ltd oil c/m $441.00 $425.00 $460.00
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bbl 70.11 67.56 73.13
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Crescent Point oil bbl 72.33 71.70 75.83
Energy Corp
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c/m 455.00 451.00 477.00
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In Cdn $ gas c3/m3 99.00 120.00 175.00
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Prices have been NGL c/m 228.00 286.00 327.00
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rounded and averaged bbl 36.24 45.46 52.00
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The following table sets forth operating netbacks received from operators
for the period August 1, 2009 to October 31, 2009:
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Crescent Point Energy
Section 13-8-11-W2M
Aldon Oils Ltd. (2 wells)
S 1/2 Section 5-9-9-W2M W 1/2 Section 31-8-9-W2M
Cdn $ (2 wells) (2 wells)
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Per boe Per cm Per boe Per cm
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Total Volume 2,072 329.3 6,609
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Aggregate Price $ 69.16 $ 435.01 $ 70.32 $ 442.31
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Royalty (15%) 10.23 64.34 (10%) 6.90 43.40
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GOR (5%) 1.46 9.18 ---------0 -----------
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Subtotal $ 57.44 $ 361.36 $ 63.38 $ 398.67
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Equipment
rentals (2)(1) 6.08 (1) 38.24 0 0
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Supervision (1) 0 (1) 0 0 0
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Operators fees (1) 1.61 (1) 10.17 (1) 0.28 (1) 1.78
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Admin fees (2)(1) 24.89 (1)156.55 (1) 0.22 (1) 1.43
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Treatment (1) 5.48 (1) 34.45 (1) 4.08 (1) 25.67
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Trucking (oil,
water and
hauling) (1) 20.62 (1)129.75 2.21 13.90
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Disposal 3.01 19.00 2.78 17.48
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Other Expenses 5.89 37.05 8.13 51.14
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Gas Processing ---------0 ---------0 (1) 0.68 (1) 4.27
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Total Expenses $ 66.85 $ 420.48 $ 18.06 $ 113.63
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Gross Profit
(Loss) before
workovers and G&A (9.40) (59.13) 45.31 285.00
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Workovers/AFE (4.77) (30.01) (7.40) (46.54)
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Operating Netback $(14.17) $ (89.13) $ 37.91 $ 238.47
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Note
(1) Denotes non arms length charges.
(2) will be subject to joint venture audit
There is a significant difference between the operating netbacks on the 6 Bakken wells between two operators. The wells have the same maintenance, treatment, trucking and disposal requirements. Differences can be explained as follows: (a) Crescent Point has tied in 2 of 4 wells it operates by pipeline to a central battery (W 1/2 Section 31-8-9-W2M); and (b) rates charged for non arms length services provided to the joint venture partners.
Drilling Plans for 2010
Production could increase in the third quarter if the Corporation drills the 2 Bakken wells described as Antler Creek Heward HZ S 3A1-24-3A1 13-9-9-W2M and Antler Creek Heward 2HZ S 1B12-13-4B4 13-9-9-W2M. Antler Creek has farmin rights to 75% of the oil and gas mineral rights under SW, SE and NE Section 13-9-9-W2M. It is expected that Antler Creek will be the operator. Assuming all pre-conditions can be met, Antler Creek will drill, case and complete a 1,400m horizontal Bakken well named Antler Creek HZ S 3A1-24-3A1 13-9-9-W2M. The expected cost is estimated at $2,000,000. It is expected that Antler Creek will drill, case and complete a 600m bi-lateral horizontal Bakken well named Antler Creek 2HZ S 1B12-13-4B4 13-9-9-W2M. The expected cost is $2,000,000. The wells should be completed by June 2010 or sooner if arrangements can be worked out with all mineral rights holders. Antler Creek has filed an application under section 30 of the Oil & Gas Conservation Act (Saskatchewan) to pool the NE, SE and SW of Section 13-9-9-W2M.
Private Placement
Antler Creek is seeking to raise approximately $7.2M by way of a private placement being the sale of common shares (with and without flow through attributes). The transaction will be non-brokered and sold on a best efforts basis. Antler Creek is prepared to pay a finders fee of 5-7% cash (or maximum permitted by the TSX Venture Exchange) to persons who introduce qualified accredited investors plus a warrant equivalent to 10% of the shares sold. The warrant will entitle the finder to acquire Antler Creek common shares at any time up to 2 years from the date of closing of the financing. The Antler Creek common shares issued as part of the financing and the Antler Creek common shares issued upon exercise of any warrants issued as part of the placement will be subject to a 4 month hold period from the date of closing.
ON BEHALF OF THE BOARD
Antler Creek Energy Corp
Gus B. Coolidge, President
BOE Conversion. The term boe refers to barrel of oil equivalent. Boe's may be misleading, particularly if used in isolation. A boe conversion ratio of six mcf per one barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Forward-Looking Statements. This news release contains forward-looking statements that are expressly qualified in their entirety, by this caption. Such statements include all disclosure concerning the plans, intentions or expectations of the Corporation or its management in future periods. Although, the Corporation believes that these forward looking statements are reasonable, undue reliance should not be placed on them as they are inherently uncertain, based on estimates and assumptions, and subject to substantial known and unknown risks and uncertainties, many of which are beyond the Corporation's control. Forward-looking statements are not guarantees of future outcomes. There can be no assurance that the plans, intentions or expectations contained in the forward-looking statements or upon which they are based will in fact occur or be realized, and actual results, performance or achievements may differ from those expressed or implied in the forward-looking statements. The differences may be material.
Statements related to "reserves" are forward looking statements, as they involve an implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and can profitably be produced in the future.
In making the forward-looking statements contained in this press release, the Corporation has made several assumptions regarding, amongst other things: future oil and natural gas prices; future capital requirements; the accessibility and cost of capital (including credit); the Corporation's ability to economically produce oil and gas from its properties and the timing and cost to do so; and its ability to obtain qualified staff; equipment and supplies in a timely and cost efficient manner.
All forward looking statements contained in this press release and any subsequent forward-looking statements whether written or oral, attributable to the Corporation or persons acting on its behalf are qualified in their entirety by these cautionary statements. Further, the included forward-looking statements are made as of the date of this press release and the Corporation undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.
Neither the TSX Venture Exchange nor its Regulation Services Provide (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
Calgary Alberta T2P 3R5
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