Canadian Superior Energy Inc.
TSX : SNG
NYSE Amex : SNG

Canadian Superior Energy Inc.

November 13, 2009 08:31 ET

Canadian Superior Energy Inc. Reports Third Quarter 2009 Operational and Financial Results

CALGARY, ALBERTA--(Marketwire - Nov. 13, 2009) - Canadian Superior Energy Inc. ("Canadian Superior" or the "Company") (TSX:SNG)(NYSE Amex:SNG) is pleased to announce its financial and operating results for the three months ("Q3 2009") and nine months ended September 30, 2009.

RECENT HIGHLIGHTS

Corporate Highlights

- On October 28, 2009, the Company announced that the Toronto Stock Exchange ("TSX") had completed its review of the common shares of the Company and had determined that the Company met the TSX original listing requirements;

- On October 28, 2009, the Company announced that its current lender, the National Bank of Canada, approved an increase in the Company's credit facility from $25 million to $40 million;

- On September 17, 2009, the Company announced it had completed its financial restructuring and had emerged from protection under the Companies' Creditors Arrangement Act (Canada) ("CCAA"). The Plan resulted in the acquisition of Challenger Energy Corp., the sale of a 45% interest in Block 5 (c) in Trinidad and Tobago to BG International Limited and the Company's creditors being paid in full. The Company has retained a 25% interest in Block 5 (c), its assets in Western Canada, the East Coast and North Africa and a 100% interest in its Liberty Natural Gas project in the United States; and

- On September 9, 2009, the shareholders elected six independent directors to the board, five of whom are new directors.

Operational Highlights

Western Canada

- Current production from Western Canada is approximately 2,700 boe/d, an increase of approximately 150 boe/d from the third quarter daily average production of 2,546 boe/d. There remain several wells from the 2008 drilling program to be tied-in. Tie-in operations have currently been suspended pending freeze-up;

- The Company currently has three rigs drilling and expects to have a further two to three rigs running continuously through November and December. These rigs are focused on exploration plays with a mix of oil and gas targets. The drilling and subsequent completions of these wells are expected to fulfill our 2009 flow-through expenditure commitments.

Trinidad and Tobago

- The Company's remaining 25% interest in Block 5 (c) remains an important asset in creating future shareholder value. The planning of the appraisal program is budgeted to occur in 2010 with actual drilling on the block is expected in 2011.

Tunisia/Libya

- The Company has completed the 2D and 3D seismic interpretation of 7th of November Block in offshore Tunisia/Libya and has identified two locations. The Company is advancing the well planning and rig sourcing with a goal of drilling the Zarat appraisal well in the latter half of 2010.

Liberty Natural Gas

- In August 2009, the Company executed an agreement wherein the Company now owns 100% of the project and is responsible for 100% of the ongoing costs. The Company has recommenced the permitting process.

Financial Highlights

- Western Canada average daily production of 2,548 boe/d in Q3 2009 was down 29% compared to Q3 2008; petroleum and natural gas revenues of $5.9 million was achieved in Q3 2009, down 71% compared to Q3 2008; and cash flow from operations before restructuring costs was $(3.2) million in Q3 2009, down 133% compared to the same period in 2008;

- Western Canada average daily production for the nine months ended September 30, 2009 was 3,007 boe/d, down 14% or 509 boe/d compared to the nine months ended September 30, 2008; for the nine months ended September 30, 2009, petroleum and natural gas revenues were $23.8 million or $29.03/boe, down 61%, compared to $61.3 million or $63.57/boe for the comparable period in 2008; and, for the nine months ended September 30, 2009, cash flow from operations before restructuring costs was $(4.0) million compared to $29.2 million for the comparable period in 2008;

- The decrease in petroleum and natural gas sales is mainly due to significant decline in commodity prices combined with natural declines in production volumes in 2009 compared to 2008. In addition, during CCAA, the Company was unable to tie-in all the successful wells from the 2008 drilling program and was forced to postpone the 2009 drilling program until the Company exited from CCAA protection on September 15, 2009;

- During the nine months ended September 30, 2009, the Company incurred $18.9 million in restructuring costs related to the receivership of the Trinidad Block 5 (c) asset and CCAA proceedings. These costs were substantially related to legal costs incurred directly by the Company and associated with the CCAA process and legal costs incurred by the Receiver, BG International and the Company's former banker, charged back to the Company; and

- The Company recorded net income for the nine months ended September 30, 2009 of $10.6 million compared to a loss of $5.6 million for the comparable period in 2008. The increase in 2009 is mainly attributable to the gain of $35.6 million related to the disposition of a 45% interest in Block 5 (c) to BG International for gross proceeds of USD $142.5 million.



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Financial and Operational
Highlights
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September 30 Three
Months
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%
2009 2008 Change

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Financial

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($000's except per share
amounts)

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Petroleum and Natural Gas Sales,
net of transportation 5,913 20,494 (71)

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Cash Flow from (used for)
Operations before restructuring
costs (3,147) 9,330 (133)

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Per Share (0.02) 0.06 300

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Net Income (Loss) 29,456 (2,117) 1,491

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Basic & Fully Diluted Earnings
Per Share 0.17 (0.01) 50

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Capital Expenditures 55,872 39,516 41

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Nova Scotia Offshore Deposits 15,167 14,559 4

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Net Surplus (Debt) 6,917 (16,674) 142

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Shares Outstanding at Period
End 196,373,000 158,116,000 33

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Operating

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Average Production

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Natural Gas (mcf/d) 11,794 17,268 (32)

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Oil and NGL's (bbls/d) 582 689 (16)

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Boe/d 2,548 3,567 (29)

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Average Selling Price

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Natural Gas ($/mcf) 2.57 8.55 (70)

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Oil and NGL's ($/bbl) 58.24 108.99 (47)

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Total ($/boe) 25.23 62.45 (60)

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Gross Undeveloped Land (Acres)

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Western Canada 227,763 210,010 8

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Offshore Trinidad and Tobago 135,060 135,060 0

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Offshore Nova Scotia 1,070,335 1,234,546 (13)

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Offshore Tunisia/Libya 768,000 768,000 0

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Wells Drilled Western Canada

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Gross 0 10.0 n/a

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Net 0 9.7 n/a

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Financial and Operational
Highlights

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September 30 Nine
Months

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%
2009 2008 Change

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Financial

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($000's except per share
amounts)

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Petroleum and Natural Gas Sales,
net of transportation 23,837 61,250 (61)

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Cash Flow from (used for)
Operations before restructuring
costs (4,003) 29,247 (114)

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Per Share (0.02) 0.20 175

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Net Income (Loss) 10,582 (5,569) 290

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Basic & Fully Diluted Earnings
Per Share 0.06 (0.04) (300)

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Capital Expenditures 85,264 77,866 10

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Nova Scotia Offshore Deposits 15,167 14,559 4

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Net Surplus (Debt) 6,917 (16,674) 142

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Shares Outstanding at Period
End 196,373,000 158,116,000 33

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Operating

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Average Production

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Natural Gas (mcf/d) 14,616 17,007 (14)

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Oil and NGL's (bbls/d) 571 682 (16)

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Boe/d 3,007 3,516 (14)

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Average Selling Price

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Natural Gas ($/mcf) 3.84 9.00 (57)

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Oil and NGL's ($/bbl) 54.47 103.43 (47)

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Total ($/boe) 29.03 63.57 (54)

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Gross Undeveloped Land (Acres)

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Western Canada 227,763 210,010 8

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Offshore Trinidad and Tobago 135,060 135,060 0

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Offshore Nova Scotia 1,070,335 1,234,546 (13)

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Offshore Tunisia/Libya 768,000 768,000 0

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Wells Drilled Western Canada

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Gross 0 18.0 n/a

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Net 0 16.6 n/a

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Copies of Canadian Superior's Unaudited Consolidated Financial Statements for the three and the nine months ended September 30, 2009 along with Management Discussion & Analysis ("MD&A") may be obtained on the System for Electronic Document Analysis and Retrieval at www.sedar.com.

Canadian Superior Energy Inc. is a Calgary, Alberta, Canada based diversified global energy company engaged in the exploration and production of oil and natural gas, and in development of a liquefied natural gas ("LNG") project, with operations offshore Trinidad and Tobago, offshore Nova Scotia, Canada, in Western Canada, in the United States and in North Africa. See Canadian Superior's website at www.cansup.com to review Canadian Superior's operations in Western Canada, offshore Trinidad and Tobago, offshore Nova Scotia interests, in the USA and its North Africa interests.

Non-GAAP Measures - This press release contains the term cash flow from (used for) operations before restructuring costs, which is a non-GAAP financial measure that does not have any standardized meaning prescribed by GAAP and is, therefore, unlikely to be comparable to similar measures presented by other issuers. Management believes cash flow from (used for) operations before restructuring costs is relevant indicator of the Company's financial performance, ability to fund future capital expenditures and repay debt. Cash flow from (used for) operations before restructuring costs should not be considered an alternative to or more meaningful than cash flow from operating activities, as determined in accordance with GAAP, as an indicator of the Company's performance. In the cash flow from (used for) operations section of the MD&A, reconciliation has been prepared of cash flow from operations, the most comparable measure calculated in accordance with GAAP.

This news release contains forward-looking information, including the expectation of successful future results and the ability to meet future obligations. Actual results could differ materially due to changes in project schedules, commercial negotiations, changes in energy pricing, unforeseen technical or the inability to raise additional capital, therefore there can be no assurance that any of the foregoing actions by the Company will be completed as contemplated. Forward-looking information contained in this news release is as of the date of this news release. The Company assumes no obligation to update and/or revise this forward-looking information except as required by law.

Statements contained in this news release relating to future results, events and expectations are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve known and unknown risks, uncertainties, scheduling, re-scheduling and other factors which may cause the actual results, performance, estimates, projections, resource potential and/or reserves, interpretations, prognoses, schedules or achievements of the Corporation, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such statements. Such factors include, among others, those described in the Corporation's annual reports on Form 40-F or Form 20-F on file with the U.S. Securities and Exchange Commission.

Contact Information

  • Canadian Superior Energy Inc.
    Investor Relations
    (403) 294-1411
    (403) 216-2374 (FAX)
    www.cansup.com
    or
    Canadian Superior Energy Inc.
    Suite 3200, 500 - 4th Avenue S.W.
    Calgary, Alberta, Canada
    T2P 2V6