Primera Energy Resources Ltd.
TSX VENTURE : PTT

November 25, 2010 17:41 ET

Primera Energy Resources Ltd. (TSX-V:PTT) Releases Q3-2010 Financial Results

PORT OF SPAIN, TRINIDAD & TOBAGO and CALGARY, ALBERTA--(Marketwire - Nov. 25, 2010) - Primera Energy Resources Ltd. ("Primera" or the "Company") (TSX VENTURE:PTT) is pleased to announce a 26% increase in oil production per day in the third quarter of 2010. Also, revenue was 29% higher for the nine month period ended September 30, 2010 with $5,408,764 due to the increased sales volumes and higher commodity prices.

In the third quarter of 2010, operating costs per barrel was $6.40 which was significantly lower than the $11.88 per barrel in 2009. This and the higher realized oil price resulted in 34% higher cash flow from operations in the last year at $418,234 compared to $312,724 in the third quarter of 2009.

Primera had a working capital surplus of $3,588,001 as of September 30, 2010, which included cash of $4,345,479 and no bank debt, compared to a working capital surplus of $1,432,098 in the same period last year. 

The Company has spent $2,063,581 during the nine-month period ended September 30, 2010 on capital expenditures with $589,405 for Cory Moruga drilling costs based on the 5% participating interest in the farm out agreement and $1,474,176 on WD4 drilling costs compared to $360,426 in 2009.

Completion operations for the two Cory Moruga wells (Firecrown-1 and Snowcap-1), which were drilled earlier in 2010, will commence once regulatory approvals in Trinidad are received. The Snowcap-1 well has now received environmental approval for multi-zone testing. This well is expected to commence testing by the operator in early December 2010 however the Firecrown-1 well is not expected to be tested until early 2011.

In the Budget statement for fiscal year 2011, the government of Trinidad & Tobago announced that the Government will implement sustainability incentives for mature marine and small marine oil fields. These incentives will provide for a reduction of 20 percent on Supplemental Petroleum Tax rates for mature or small marine oilfields. An Investment Tax Credit of 20 percent on qualifying capital expenditure will also be granted in respect of Supplemental Petroleum Tax for mature oil fields, both land and marine. These measures will take effect from January 1st 2011, and will require amendments to the Petroleum Taxes Act.

Based on the incentives stated above, Primera expects to achieve an approximate increase of approximately 16% on its netback, corresponding to an increase in net profits of approximately US$ 120,000 annually at current production levels and commodity prices.

Primera's Q3-2010 financial statements and management's discussion & analysis have been filed on SEDAR, which accessed electronically from www.sedar.com.

Statements in this press release may contain forward-looking information including expectations of future operations and plans. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the issuer. These risks include, but are not limited to, the risks associated with the oil and gas industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to, operational risks in development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, or reservoir performance, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. The reader is cautioned not to place undue reliance on this forward-looking information.

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

Contact Information

  • Primera Energy Resources Ltd.
    Geoffrey Leid
    Chief Executive Officer
    (868) 378-5343