Traverse Energy Ltd.

June 20, 2011 16:56 ET

Traverse Energy Announces 2011 First Quarter Results

CALGARY, ALBERTA--(Marketwire - June 20, 2011) - Traverse Energy Ltd. ("Traverse" or "the Company") (TSX VENTURE:TVL) presents financial and operating results for the three months ended March 31, 2011. Unless otherwise stated, the volume conversion of natural gas to barrel of oil equivalent (BOE) is presented on the basis of 6 thousand cubic feet of natural gas being equal to 1 barrel of oil.

HIGHLIGHTSThree months ended
(unaudited)March 31, 2011Dec. 31, 2010March 31,2010
Financial ($ thousands, except per share amounts)
Petroleum and natural gas revenue9841,136291
Funds flow from operations *40463633
Per share - basic and diluted0.010.020.00
Cash flow from operations768244(57)
(including changes in working capital)
Per share - basic and diluted0.020.010.00
Net loss(7)(2,709)(116)
Per share - basic and diluted0.00(0.09)(0.00)
Capital expenditures, net of dispositions8783,5692,348
Total assets10,96012,0359,810
Working capital1,9242,3582,243
Common shares
Outstanding (millions)32.03225.0
Weighted average (millions)31.93025.0
Operations (units as noted)
Average production
Natural gas (mcf/day)403423230
Oil and NGL (bbls/day)12014327
Total (BOE/day)18721466
Average sales price
Natural gas ($/mcf)3.963.735.09
Oil and NGL ($/bbl)78.0275.1075.84
Netback per BOE ($/BOE)
Petroleum and natural gas revenue58.5057.7349.34
Operating netback41.4940.6734.57
*Management uses funds flow from operations (before changes in non-cash working capital and decommissioning expenditures) to analyze operating performance. Funds flow from operations does not have any standardized meaning prescribed by IFRS and therefore may not be comparable with the calculation of similar measures for other entities.

Operations review

Traverse plans an active 2011. Activities include 7-10 wells and 3D seismic shooting within an initial budget of $8-9 million. In May 2011, the Company completed a private placement of both common and flow-through common shares. A total of 6,531,128 common shares were issued for gross proceeds of $5,574,593. The Company will largely focus on its' existing light oil properties in central and southern Alberta.

During the first quarter the 100% owned oil well at Carbon was flow tested. Due to the associated natural gas, the well needs to be pipeline connected to nearby infrastructure for further production testing. The tie-in was scheduled immediately after spring break-up. Prolonged wet weather conditions have prevented installation to date. No new wells were drilled during the quarter. Other activities included land acquisition in the Long Coulee and Turin areas, third party seismic purchases, pre-drilling preparations in other areas and equipment expenditures.

Subsequent to the end of the first quarter, Traverse completed the drilling of 2 gross (1.93 net) wells. In the Turin area, 1 net well has been cased as a potential Mannville oil well. Completion and tie-in activities to the Company`s infrastructure and battery site are planned once the current wet weather conditions improve. In the Alliance area, Traverse drilled a 0.93 net well which included a 1075 meter horizontal leg in the Viking zone. Completion operations at the well are suspended due to wet weather and will resume once field conditions improve.

Traverse plans further drilling at Turin, Long Coulee, Carbon, and in several other areas during 2011.

Forward-looking information

This press release contains forward-looking information. Forward-looking information is based upon the opinions, expectations and estimates of management as at the date the information is provided and, in some cases, information received from or disseminated by third parties. In particular, the Company's statements with respect to completion and tie-in activities in the Turin and Alliance areas and planned drilling and 3D seismic shooting for the remainder of 2011 contain forward-looking information. This forward-looking information is subject to a variety of substantial known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking information. The Company's Annual Information Form filed with securities regulatory authorities (accessible through the SEDAR website describes the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference.

The forward-looking information contained in this press release is made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Further details on the Company including the 2011 first quarter unaudited financial statements, the related management's discussion and analysis and Annual Information Form are available on the Company's website and SEDAR.

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

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