Condor Petroleum Inc.
TSX : CPI

Condor Petroleum Inc.

March 18, 2015 18:49 ET

Condor Announces 2014 Year End Results

CALGARY, ALBERTA--(Marketwired - March 18, 2015) - Condor Petroleum Inc. ("Condor" or the "Company") (TSX:CPI) is pleased to announce the release of its Consolidated Financial Statements for the year ended December 31, 2014, together with the related Management's Discussion and Analysis. These documents will be made available under Condor's profile on SEDAR at www.sedar.com and on the Condor website at www.condorpetroleum.com. All financial amounts in this news release are presented in Canadian dollars, unless otherwise stated.

2014 Highlights

  • During 2014 the Company completed the sale of its 66% interest in the Marsel property for US $88.0 million (CAD 98.1 million).

  • Working capital as of December 31, 2014 was $59.0 million and the Company has no debt.

  • Net income for the year ended December 31, 2014 was $23.5 million or $0.07 per share including a $34.5 million gain on the sale of the Marsel property.

  • The KN-E-205 Primary Basin appraisal well was drilled in the fourth quarter to a total depth of 1,876 meters and encountered multiple sandstone reservoirs that have a total of 71 meters of net oil pay. The well was cased to total depth. This well further validates the geological model used to characterize the Primary Basin play, continuing to reduce the geologic risk associated with the deeper Primary Basin prospects on Zharkamys like KN-501.

  • The tendering process is underway to select services for drilling the KN-501 Primary Basin target, scheduled to commence in the second quarter of 2015. The KN-501 well offsets the Company's play opening KN-E Primary Basin discovery by eight kilometers and is located under the same salt dome. The well is planned to reach 4,250 meters and is targeting 67 MMboe unrisked mean prospective resources (internal Company estimate - see Reserve and Resource Advisory).

  • During 2014 the Zharkamys exploration period was extended for an additional five months to February 8, 2016 and an application to extend the exploration period for a further ten months until December 2016 has been submitted.

  • Production facilities at the Shoba and Taskuduk oilfields have been constructed and, for each respective field, once a development contract is executed with the Government of Kazakhstan the Company will be entitled to access export markets to sell a portion of the crude oil produced.

  • Production increased 64% to an average of 343 bopd for the three months ended December 31, 2014 from 210 bopd for the same period in 2013 and decreased 30% to 205 bopd for the year ended December 31, 2014 from 291 bopd in 2013. The fourth quarter increase relates to the positive performance of the two Shoba horizontal wells which were successfully drilled and completed in the fourth quarter of 2014, representing the first shallow horizontal wells drilled in Kazakhstan's Pre-Caspian basin. Sh-10h began producing in late October and Sh-11h in mid-December. Flow rates on both wells have been restricted thus far to minimize the potential for water and gas coning.

  • Production at Shoba has been temporarily suspended effective March 15, 2015 for an indeterminate period due to constraints in domestic refining capacity and low prices for crude oil and refined crude oil products. Kazakhstan is experiencing an oversupply of refined crude oil products, including diesel, which is causing downward pricing pressures on domestically produced diesel and on crude oil. Currently, Kazakhstan refineries are either not operating or the offering prices are below the Company's cost of operations. The Government of Kazakhstan recently announced that export customs duties on crude oil and certain refined products will be reduced and a temporary ban on imports of gasoline and diesel fuel from Russia has also been imposed. Both measures are intended to help alleviate the domestic market oversupply.

About Condor

Condor is a Canadian based oil and gas company with a 100% interest in the exploration rights to the 3,777 square kilometer Zharkamys West 1 Territory located in Kazakhstan's Pre‐Caspian basin. The Company is listed on the TSX under the symbol "CPI".

Resource advisory

This news release includes information pertaining to internal Condor generated estimates of Company resources effective January 20, 2015, which were prepared by a qualified reserves evaluator in accordance with National Instrument 51-101.

Statements relating to resources are deemed to be forward looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the resources described exist in the quantities predicted or estimated. The resource estimates of Condor's properties described herein are estimates only. The actual resources may be greater or less than those calculated. Estimates with respect to resources that may be developed and produced in the future are often based upon volumetric calculations, probabilistic methods and analogy to similar types of resources, rather than upon actual production history. Estimates based on these methods generally are less reliable than those based on actual production history. Subsequent evaluation of the same resources based upon production history will result in variations, which may be material, in the estimated resources.

Prospective Resources disclosed herein are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery (geological chance of success) and a chance of development (economic, regulatory, market and facility, corporate commitment or political risks). The chance of commerciality is the product of these two risk components. These estimates have not been risked for either chance of discovery or chance of development. There is no certainty that any portion of the Prospective Resources will be discovered and, if discovered, there is no certainty that it will be developed or, if it is developed, there is no certainty as to either the timing of such development or whether it will be commercially viable to produce any portion of the resources. Unless otherwise stated, any reference to Prospective Resources refers to Gross, Mean Recoverable, Prospective Resources (Unrisked).

Advisory on Forward-Looking Statements

All statements other than statements of historical fact may be forward-looking statements. Such statements are generally identifiable by the terminology used, such as "seek", "anticipate'', "believe'', "intend", "expect", "plan", "estimate", "continue", "project", "predict", "budget'', "outlook'', "may", "will", "should", "could", "would" or other similar wording. Forward-looking statements in this news release includes, but is not limited to, information concerning: projections and timing with respect to crude oil production; production results provided may not be indicative of future production rates, capabilities or ultimate recovery; the validation of the Primary Basin geological model; information concerning the timing of planned drilling and development operations; the validation of the Primary Basin geological model; the timing and ability to execute contracts with drilling equipment suppliers and service providers; the timing and ability to obtain various approvals and permits, including development contracts; the timing and ability to extend the Zharkamys exploration period; changes, if any, to the minimum work program; the timing and ability to access domestic and export sales markets for crude oil; and the timing and duration of production interruptions. Forward-looking statements involve the use of certain assumptions that may not materialize or that may not be accurate and are subject to known and unknown risks and uncertainties and other factors, which may cause actual results or events to differ materially from those expressed or implied by such information. Condor's operations are also subject to certain other risks and uncertainties inherent with oil and gas operations and additional information on these and other factors that could affect Condor's operations and financial results. These factors are discussed in greater detail under Risk Factors - Risks Relating to the Company in Condor's Annual Information Form, which may be accessed through the SEDAR website (www.sedar.com). The Company believes that the expectations reflected in these forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. The Company does not undertake any obligation to update or to revise any of the forward looking information, except as required by applicable law.

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

Contact Information

  • Condor Petroleum Inc.
    Don Streu
    President and CEO
    403-201-9694

    Condor Petroleum Inc.
    Sandy Quilty
    Vice President of Finance and CFO
    403-201-9694