Anterra Corporation

Anterra Corporation

August 12, 2005 09:00 ET

Anterra Announces Second Quarter Results

CALGARY, ALBERTA--(CCNMatthews - Aug. 12, 2005) - Anterra Corporation (TSX:ATR), ("Anterra" or the "Company") is pleased to announce its financial and operating results for the second quarter of 2005.


- Production increased to an average 193 boe/d for the second quarter of 2005 from an average of 130 boe/d for the same quarter of 2004, an increase of over 48%.

- Production per share increased to an average of 8.8 boe/d per million shares in the second quarter of 2005, from 7.5 boe/d per million shares in the second quarter of 2004.

- Net Revenue increased to $1,086,000 in the second quarter of 2005 from $643,379 for the second quarter of 2004.

- Funds flow increased to $267,025 or $0.012 per share, for the second quarter of 2005 from $173,788, or $0.01 per share, in the second quarter of 2004.

Financial Three Months Ended Six Months Ended
Highlights June 30 June 30
2005 2004 2005 2004
Net Revenue $ 1,086,000 $ 643,379 $ 2,120,480 $ 1,200,848

Oil and gas operating
margin $ 585,696 $ 225,856 $ 1,142,991 $ 424,410
Boepd for the period 193 130 193 127
Net back $/boe for
the period $ 33.08 $ 19.05 $ 32.48 $ 18.00
Midstream operating
margin $ (5,177) $ 96,648 $ 39,931 $ 185,439
Operating margin % (3%) 48% 9% 46%

Funds flow from
operations $ 267,025 $ 173,788 $ 527,571 $ 326,078
Funds flow per share $ 0.012 $ 0.010 $ 0.024 $ 0.019

Net profit $ 84,126 $ 38,654 $ 197,630 $ 56,633
Net profit per share $ 0.004 $ 0.002 $ 0.009 $ 0.003

Shareholders' equity $ 3,141,741 $ 2,037,334 $ 3,141,741 $ 2,037,334

Weighted average
common shares 21,930,000 17,380,000 21,930,000 17,380,000

Funds flow from operations is not a recognized measure under Canadian generally accepted accounting principles (GAAP). However, management believes that funds flow from operations is a useful measure of financial performance. For the purposes of funds flow from operations calculations, funds flow is defined as "Funds flow from operations" before changes in non-cash operating working capital.


During the quarter, Anterra continued to exploit its oil and gas properties in central and south east Alberta, and to pursue permitting of its Class 1b facility permit at Suffield, while developing a third midstream project north of Edmonton. Oil and gas production averaged 193 boepd during the quarter with 50 boepd of gas behind pipe at Breton, awaiting completion of infrastructure improvements. Net revenue for the quarter increased 70% to $1,086,000 from $643,379 for the same period last year. Funds flow from operations increased 80% from $173,788 to $267,025 for the same period last year, despite having been reduced by a $132,158 provision for cash taxes. The cash taxes payable are substantial and management is exploring the options available to reduce this cash liability. Financial performance continues to be influenced by strong commodity prices as little new productive capacity was added during the quarter.

On the operations side, the second quarter of 2005 has been a relatively quiet one, due to the early onset of break-up and wet weather in June. Although our exploitation efforts were minimal during the second quarter, Anterra has been busy building its prospect and project inventory and evaluating certain assets for potential acquisition. Anterra anticipates that the remainder of the year will be very active.

The Class 1b permit for Suffield has yet to be issued although it is expected by early September. As a result, operating margins at Suffield remain low until the Class 1b service is operational. Exploitation of the Breton Basal Belly River pool at Breton continues, both for oil and gas, however the unexpected volumes of gas discovered in the Belly River sands cannot be produced until facility constraints have been removed.


The highlight of the second quarter was the discovery of gas in the upper Belly River sands at Breton. The LSD 10-22 well was tested and demonstrated the capability to produce gas at a sustained rate of over 400 mcfd (66 boepd). As a result of this success, management pursued a multi section farm-in on the Belly River sands with an adjoining major oil and gas company and is now working to remove plant "bottlenecks" and to exploit the opportunity to produce more gas. At the same time, the re-completion of operating and suspended wells at Breton continued. Management also plans to drill one or more wells at Breton this fall. In south east Alberta, one suspended well was placed on production and a larger pump was installed on the Scots Lake oil well. These activities increased south east Alberta production by 10 boepd. During the third quarter, one abandoned oil well will be re-completed and the company's technical staff will continue to review seismic and geology at Suffield, to define potential drilling locations in the Manville and Sunburst formations.

Oil and gas production is presently 200 boepd with over 50 boepd behind pipe at Breton. This gas is scheduled to be tied in by the end of the third quarter, although the timing is related to the availability of larger compression equipment.


During the quarter, management continued to respond to the AEUB on outstanding matters related to the Class 1b permit application for Suffield. All of the outstanding technical issues have been satisfied and the operating permit is expected within 30 days. The Suffield Class 1b disposal operation is budgeted to have a significant impact on the company's financial performance during the fourth quarter. At Breton, midstream volumes have been steady. During the first six months of the year, management has been working on the development of a new midstream facility north of Edmonton. Subject to permitting, construction is scheduled for the winter of 2005-2006. This facility will comprise Class 1b water disposal, emulsion treating and a clean oil truck terminal.


Although operating performance for the company has been steady, in the present commodity price environment investors expect more. Oil and gas production is growing steadily, midstream operations are being expanded as quickly as the regulatory requirements allow and the company's taxable situation presents management with a challenge. Management is examining its options for expansion including the addition of another core area and a more rapid expansion of its midstream business.

On the management front, Mr. Bob Dittmer, the company's VP Finance and CFO, resigned as of July 31, 2005 due to health reasons. Mr. Dittmer will be greatly missed and we wish him all the best as he undergoes medical treatment. Management would also like to thank the directors for their help and guidance during the quarter.

Anterra Corporation ("Anterra") is a unique energy company with a focus on the exploitation of oil and gas reserves and the development of associated fee-based energy projects in Western Canada. Anterra is a public Canadian company listed on the TSX Venture Exchange under the symbol ATR and currently operates through its two wholly owned subsidiaries; Anterra Resources Inc. and Anterra Midstream Inc. More information about Anterra is available on the internet at

This news release may contain forward-looking information. Actual future results may differ materially from those contemplated.

Common Shares Outstanding: 21,930,000

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information