Culane Energy Corp.
TSX VENTURE : CLN

Culane Energy Corp.

June 16, 2011 14:02 ET

Culane Energy Releases 2011 First Quarter Financial Results

CALGARY, ALBERTA--(Marketwire - June 16, 2011) -

THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO U.S. PERSONS.

Culane Energy Corp. (TSX VENTURE:CLN) ("Culane" or the "Company") announces its financial and operating results for the first quarter ended March 31, 2011. The unaudited Financial Statements and related Management's Discussion and Analysis have been filed with Canadian securities regulatory authorities on SEDAR at www.sedar.com and posted on the Company's website at www.culaneenergycorp.com.

20112010
SUMMARYQ1Q1
Daily production - BOE8451,056
Netback per BOE21.0528.21
Cash flow - ($000's)9442,176
Cash flow per share (basic)0.030.09
Earnings (loss) - ($000's)(831)(446)
Wells drilled24

Capital expenditures - ($000's)
2,5126,847
Working Capital - ($000's)794(2,725)
Bank debt - ($000's)(21,289)(15,847)
Net debt - ($000's)(20,495)(18,572)
Basic shares outstanding at March 3127,189,75424,519,754

Per share information stated below is based on weighted average basic outstanding shares, while financial results are those recognized under IFRS.

  • Water-flood injection rates at Killam reached 6,500 bbls/d early in the first quarter of 2011 following the tie-in of its final water source well. Current rates are approximately 6,100 – 6,300 bbls/d. Production at Killam for Q1/11 – 782 BOE/d, Q4/10 – 781 BOE/d.

  • Production for the Company averaged 845 BOE/d for Q1/11 compared to 1,056 BOE/d for Q1/10 (Q4/10 – 859, Q3/10 – 958, Q2/10 – 980). Production mix was 75% oil and 25% natural gas for the first quarter of 2011.

  • Prices for Q1/11 averaged $72.45 per bbl for oil and $3.92 per Mcf for natural gas compared to Q1/10 prices of $73.50 per bbl for oil and $5.17 per Mcf of natural gas.

  • Gross revenues were $4.6 million for Q1/11 compared to $6 million for Q1/10.

  • Cash flow for Q1/11 was $0.9 million, or $0.03 per share, compared to $2.2 million, or $0.09 per share for Q1/10.

  • Capital expenditures of $2.5 million were incurred in the first quarter of 2011 with $1.2 million in Saskatchewan for two exploration wells drilled, and $1.3 million at its Killam oil field in Alberta to complete the tie-in of water source wells used in the water-flood.

  • Net debt (bank debt less working capital) at March 31, 2011 was $20.5 million compared to $18.6 million at December 31, 2010.

Current production is approximately 900 BOE's per day with an additional 45 BOE/d about to be brought back on production.

As previously announced, Culane continues to work with its financial advisor to review strategic alternatives available for the Company with a view to maximizing shareholder value.

About Culane Energy Corp.

Culane Energy is a junior oil and gas company engaged in the exploration, development and production of oil and natural gas in western Canada.

Reader Advisories

Forward-Looking Statements: This news release contains certain forward-looking statements, including management's assessment of future plans and operations and the expected timing and results from operations that involve substantial known and unknown risks, uncertainties and assumptions, certain of which are beyond Culane'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. Culane'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 Culane will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Culane's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). All subsequent forward-looking statements, whether written or oral, attributable to Culane 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 Culane 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.

BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio 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.

27,189,754Common Shares

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.

Contact Information

  • Culane Energy Corp.
    Donald D. Staus
    President and Chief Executive Officer
    (403) 263-2773
    (403) 263-2776 (FAX)
    dstaus@culaneenergycorp.com

    Culane Energy Corp.
    Stewart Larsen
    Vice President of Finance and Chief Financial Officer
    (403) 263-2773
    (403) 263-2776 (FAX)
    slarsen@culaneenergycorp.com

    Culane Energy Corp.
    Thomas H. Field, Vice President, Engineering and Operations
    and Chief Operating Officer
    (403) 263-2773
    403) 263-2776 (FAX)
    tfield@culaneenergycorp.com

    Culane Energy Corp.
    420, 333 - 5th Avenue S.W.
    Calgary, Alberta T2P 3B6
    www.culaneenergycorp.com