Bowood Energy Inc.

Bowood Energy Inc.

August 25, 2011 20:18 ET

Bowood Energy Inc. Reports 2011 Second Quarter Results, Provides Operational Update

CALGARY, ALBERTA--(Marketwire - Aug. 25, 2011) -


Bowood Energy Inc. ("Bowood" or the "Company") (TSX VENTURE:BWD) is pleased to announce its financial and operational results for the three months ended June 30, 2011 and to provide an operational update on current activity. The unaudited Financial Statements and related Management Discussion and Analysis ("MD & A") will be filed with the Canadian securities regulatory authorities on SEDAR. An electronic copy of these materials will also be available under Bowood's issuer profile on SEDAR at and on the Company's website at

Operational Highlights
Three Months Ended June 30 Six Months Ended June 30
(6:1 boe conversion) 2011 2010 2011 2010
Average daily production
Natural gas (mcf/d) 2,258 2,890 2,274 3,153
Liquids (Oil & NGLs) (bbls/d) 55 47 82 33
Oil equivalent (boe/d) 431 528 461 558
Production (boe/d) per million shares 2 3 2 3
Average sales price (including fixed commodity contracts):
Natural gas ($/mcf) 4.13 3.91 4.05 4.70
Liquids (Oil & NGLs) ($/bbl) 96.17 68.27 84.78 68.18
Oil equivalent ($/boe) 33.93 27.42 35.01 30.57
Operating cost ($/boe) 14.76 15.79 13.47 13.31
Operating netback ($/boe) (including fixed commodity contracts) 16.89 8.66 18.16 14.93
Wells drilled - gross (net):
Gas 0 (0.00 ) 1 (0.20 ) 0 (0.00 ) 1 (0.20 )
Oil 1 (0.50 ) 1 (0.60 ) 1 (0.50 ) 1 (0.60 )
Suspended -- -- -- --
D & A -- -- -- --
Total 1 (0.50 ) 2 (0.80 ) 1 (0.50 ) 2 (0.80 )

In the Southern Alberta Bakken, the initial well at Spring Coulee, which was spudded in March, is now completed. The planned water based fracture stimulations are now complete (20 stages) and flowback of frac fluids has commenced. Light oil has been recovered along with frac water during the flow back operations to date. Accelerated flow back is anticipated once the well can be equipped with tubing which is expected shortly. At present the well has recovered approximately forty five percent of the frac fluid. The Company hopes to have extended production test results on the well by early October.

The second Alberta Bakken test well for the Company at Kipp 8- 30-8-23 W4, on the Blood Reserve, commenced drilling in July. The pilot hole, which included two separate cored intervals, has now been drilled to a measured depth of 2,395 mKb and plugged back to begin drilling the horizontal section of the well. The Kipp well is licenced to a projected total depth of 3,658 meters which includes a minimum horizontal section of 1,200 meters. Testing of the well is expected in the fourth quarter of 2011.

In the Company's other core area at Armada, a two well drilling program was delayed until the end of June as a result of unusually wet weather, postponing associated production additions. Q2 production of 431 boe/d was negatively impacted by this delay, as well as the required shut in of the 2-1-17-19w4 oil well which was awaiting approval from the Energy Resources Conservation Board for Good Production Practice ("GPP"). The GPP approval has now been received and the well was subsequently re-activated in late July. Since being reactivated, the well has produced at approximately 220 boe/d (78 boe/d net), approximately 85% of which is light oil.

Completion results on the two newly drilled wells at Armada include a gas well (8-3-17-19W4) in which Bowood has a 90% working interest. The well began production in mid August. The August field estimate for the Company's total production is 520 boe/d.

Financial Highlights
Three Months Ended
June 30
Six Months Ended
June 30
(Cdn $ except common share data) 2011 2010 2011 2010
Petroleum and natural gas revenue 1,332,199 1,325,392 2,918,762 2,960,387
Per share - basic 0.005 0.007 0.011 0.016
- diluted 0.005 0.007 0.011 0.016
Funds flow from operations 104,403 (69,991 ) 418,716 491,630
Per share - basic 0.000 (0.000 ) 0.002 0.003
- diluted 0.000 (0.000 ) 0.002 0.003
Net income (loss) 134,238 (1,247,221 ) (426,067 ) (677,635 )
Per share - basic 0.000 (0.007 ) (0.002 ) (0.003 )
- diluted 0.000 (0.007 ) (0.002 ) (0.003 )
Capital expenditures 2,878,037 1,692,868 4,442,164 2,239,208
Net debt/(surplus) (2,318,300 ) 2,941,939 (2,318,300 ) 2,941,939
Shareholders' equity 50,056,448 25,854,072 50,056,448 25,854,072
Total assets 59,713,837 35,770,635 59,713,837 35,770,635
Common share data:
Basic 274,933,373 186,233,373 274,724,533 186,233,373
Diluted 274,933,373 186,233,373 274,724,533 186,233,373

Company net acreage at June 30, 2011 in the Alberta Bakken fairway was 104,000 acres. The Company has the financial ability to continue to develop its position in the Alberta Bakken fairway. At the end of Q2, 2011 Bowood had $2.3 MM in net cash and an additional $8.5 MM of capacity in an undrawn credit facility through the Canadian Western Bank. The majority of the $2.9 MM of capital expenditures in Q2 was focused on land, seismic and drilling activity in the Alberta Bakken play.

About Bowood Energy Inc.

With operations based in Calgary, Alberta, Bowood Energy Inc. is a TSX-V Tier 2 corporation. Through its wholly owned subsidiary, Bowood Energy Ltd., the Company is engaged in the acquisition, exploration, development, and production of oil and gas resources. Current projects are in the Province of Alberta.

Reader Advisories

Forward-Looking Statements: Certain information in this press release is forward-looking within the meaning of Canadian securities laws as it relates to anticipated financial performance, events or strategies. All statements other than statements of historical fact contained in this news release are forward-looking statements. Readers can identify many of these statements by looking for words such as will, anticipate, believe, plan, intend, target, and expect or similar words that suggest future outcomes. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

Forward-looking information in this press release includes, among other things, information relating to: (i) expectations regarding the Company's production results in its properties; (ii) expectations relating to the Company's financial position and its ability to access capital (iii) expectations regarding the Company's production rates, (iv) expectations regarding the completion and evaluation of the Company's Spring Coulee well; and (v) expectations regarding the spudding and drilling of new wells, including the timing of such activities.

The forward-looking statements included in this press release involve substantial known and unknown risks, uncertainties and assumptions, certain of which are beyond the Company's control. Such risks, uncertainties and assumptions include, without limitation, those associated with oil and gas exploration, development, exploitation, production, marketing, processing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that the Company will derive there from. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company's operations and financial results are included in reports, including the Company's annual information form for the financial year ended December 31, 2010, on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website ( All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

BOE may be misleading, particularly if used in isolation. A BOE conversion of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Bowood Energy Inc. was recognized as a TSX Venture 50® company in 2011. TSX Venture 50 is a trade-mark of TSX Inc. and is used under license.

For more information on Bowood Energy Inc. (TSX VENTURE:BWD) and to see the updated corporate presentation please visit our website at:

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 this news release. Bowood Energy Inc. was recognized as a TSX Venture 50® company in 2011. TSX Venture 50 is a trade-mark of TSX Inc. and is used under license.

Contact Information