Iona Energy Inc.
TSX VENTURE : INA

Iona Energy Inc.

November 28, 2014 02:00 ET

Iona Energy Inc.: 2014 Third Quarter Financial Results

CALGARY, ALBERTA--(Marketwired - Nov. 28, 2014) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN UNITED STATES

Iona Energy Inc. ("Iona" or the "Company") (TSX VENTURE:INA) a Canadian independent oil & gas company with assets in the UK North Sea announces its financial results for the three and nine months ended September 30, 2014.

Highlights

  • Q3 2014 average production of 2,736 barrels of oil equivalent per day ("boepd")
  • Revenues of $22.4 million and Adjusted EBITDA of $10.1 million
  • New management team appointed - Iain McKendrick, Executive Chairman, and Tom Reynolds, Chief Executive Officer
  • Team further strengthened with new CFO (Robert Gair), Corporate Controller (Kevin Holley), Head of Operations and Development (James Lund) and Head of Business Development (Gregor Maxwell)
  • Re-focused strategy based on "Production, Scale, Yield"
    • Seeking growth through acquisition to build scale, diversify and grow our production base, reserves and cash flow and utilise the Company's tax loss pools more effectively
    • Ultimate goal to move towards paying a sustainable and progressive dividend
  • Significant operational progress at Orlando development with offtake agreements finalised with Canadian Natural Resources ("CNR") for export via Ninian Central Platform ("NCP")
  • Orlando first oil anticipated end 2016
  • Huntington production expected to recommence on December 5 following CATS maintenance shut-in since October 18 - field operator working on gas disposal options - gas reinjection test in December
  • Proposed acquisition of 80% interest in the Trent & Tyne fields will not complete - assets being fully written down with a US$27.8 million impairment charge taken during the quarter
  • End of quarter cash $96.7 million ($61.7 million restricted for purposes of Orlando development)
  • As of Q3 2014 the Company is in compliance with its covenants under the Bond

Tom Reynolds, Chief Executive Officer, commented:

"Following the appointment of the new senior management team in early September, significant progress has been made. We have further strengthened the management team through a number of key hires, taken the first steps towards reducing our G&A, completed our asset reviews and advanced the Orlando development by finalizing offtake arrangements.

We continue to view business development based on our 'production, scale, yield' strategy as a key focus in order to grow and diversify the Company's production portfolio and have an active pipeline of attractive acquisition opportunities, which we are pursuing with the support of leading North Sea lending banks."

Operations Update

Huntington

  • Q3 2014 net production of 2,583 boepd
  • Production during the quarter was impacted by issues with the CATS infrastructure which is used to offtake gas production from the Huntington field
    • Production shut-in for most of August 2014 and constrained for October 1, 2014 - October 18, 2014
    • Production shut-in since October 18, 2014 for CATS maintenance and is expected to recommence on December 5, 2014
    • Field operator continues to work on other gas disposal options with gas reinjection test expected during December 2014

Orlando

  • Full suite of offtake agreements finalized with CNR, the operator of the NCP infrastructure to keep the project on track for first oil production at the end of 2016 and add significant production and value

Trent & Tyne

  • Q3 2014 net production of 153 boepd
  • Production during the quarter was severely reduced by planned and unplanned maintenance outages at the fields and at the Bacton terminal, in addition to continued intermittent well performance
  • Since the period end, the Company has announced that its proposed acquisition of the remaining 80% interest in the Trent & Tyne fields will not complete
  • The assets are being fully written down with a US$27.8 million impairment charge taken during the quarter

A call for analysts and investors will be held at 9.00am EST to discuss the results. Dial-in details are below:

Dial-in (Canada): +1 866 404 5783
Dial-in (UK): +44 (0) 203 139 4830
Dial-in (UK toll free): +44 (0) 808 237 0030
Passcode: 15552389#

Following the call, a playback facility will be made available on the Iona website www.ionaenergy.com.

Notes:

Further details on the above are provided in the Consolidated Financial Statements and Management's Discussion and Analysis for the quarter ended September 30, 2014 and the year ended December 31, 2013, which have been filed with securities regulatory authorities in Canada. These documents are available on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com and on the Company's website: www.ionaenergy.com.

About Iona Energy:

Iona is an oil and gas company with assets in the United Kingdom's North Sea.

Forward-looking statements:

Some of the statements in this announcement are forward-looking, including statements regarding Iona's plans for the development of its properties, statements regarding acquisitions, estimated production levels, anticipated effects of the UK small field allowance, and estimates of the net present value of future net revenue of proved and probable reserves from Iona's properties. Forward-looking statements include statements regarding the intent, belief and current expectations of Iona Energy Inc. or its officers with respect to various matters, including assumptions regarding Huntington production rates. When used in this announcement, the words "expects", "believes", "anticipate", "plans", "may", "will", "should", "scheduled", "targeted", "estimated" and similar expressions, and the negatives thereof, whether used in connection with estimated production levels and future activity or otherwise, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to risks and uncertainties that could cause actual outcome to differ materially from those suggested by any such statements, including without limitation, the risk that Iona's development plans change as a result of new information or events or the risk that proposed transactions are not completed. These forward-looking statements speak only as of the date of this announcement. Iona Energy Inc. expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based except as required by applicable securities laws.

Notes Regarding Oil and Gas Disclosure:

Note: "Boe" means barrel of oil equivalent on the basis of 6 mcf of natural gas to 1 bbl of oil. 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.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Iona Energy Inc.
    Tom Reynolds
    CEO
    +44 (0) 1224 228400
    info@ionaenergy.com

    Iona Energy Inc.
    Robert Gair
    CFO
    +44 (0) 1224 228400
    info@ionaenergy.com

    Camarco
    Billy Clegg
    +44 (0) 20 3757 4980

    Camarco
    Georgia Mann
    +44 (0) 20 3757 4980