Triton Energy Corp.
TSX VENTURE : TEZ

Triton Energy Corp.

April 22, 2009 18:33 ET

Triton Announces 2008 Operational and Financial Results

CALGARY, ALBERTA--(Marketwire - April 22, 2009) - Triton Energy Corp. ("Triton" or the "Corporation") (TSX VENTURE:TEZ) announces financial results for the year and three months ended December 31, 2008. Triton has filed its audited financial statements for the years ended December 31, 2008 and 2007, and the accompanying Management's Discussion and Analysis with Canadian securities regulatory authorities. These filings are available for review at www.sedar.com and on the Corporation's website, www.tritonenergy.ca.

2008 Highlights

- Capital expenditures totaled $15.2 million;

- Triton participated in the drilling of nine (9.0 net) wells resulting in four (4.0 net) natural gas wells, two (2.0 net) oil wells and three (3.0 net) dry holes;

- Triton pooled and equalized in one (0.5 net) multi-zone oil and natural gas well;

- Total proved plus probable reserves increased by approximately 43% to 2,387 thousand barrels of oil equivalent at December 31, 2008 compared to 1,674 thousand barrels of oil equivalent at December 31, 2007;

- The net present value (before tax discounted at ten percent) of future net revenue attributable to total proved plus probable reserves increased by approximately 56% to $43.6 million. Approximately 87% of the Corporation's total proved plus probable reserves at December 31, 2008 are natural gas while the remaining 13% are comprised of light and medium gravity crude oil and natural gas liquids;

- Total proved plus probable reserves additions represent a 340% replacement of the Corporation's 2008 production of approximately 298 thousand barrels of oil equivalent;

- Average daily production increased by approximately 30% to 814 barrels of oil equivalent per day compared to 629 barrels of oil equivalent per day in 2007;

- Petroleum and natural gas sales increased by approximately 62% to $14.85 million compared to $9.17 million in 2007;

- Funds from operations increased by approximately 104% to $6.96 million ($0.20 per share basic and diluted) compared to $3.42 million ($0.12 per share basic and diluted) in 2007 (see non-GAPP note in Financial Summary table below);

- Triton had net income of $0.54 million ($0.02 per share basic and diluted) in 2008 compared to a net loss of $1.36 million ($0.05 per share basic and diluted) in 2007;

- Based on total reserve additions of 1,011 thousand barrels of oil equivalent, finding and development costs, including changes in future development costs, improved to $20.38 per barrel of oil equivalent on a proved reserves basis and $14.65 per barrel of oil equivalent on a proved plus probable reserves basis compared to $20.86 and $15.62, respectively, in 2007;

- The Corporation exited 2008 with a working capital deficiency of $2.3 million, an $8.5 million revolving credit facility and no bank debt.



Financial Summary

----------------------------------------------------------------------------
Year Ended Three months ended
December 31, December 31,
2008 2007 2008 2007
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Financial ($000's except for (unaudited) (unaudited)
per share amounts)
Petroleum and natural gas
sales 14,853 9,170 3,592 2,808
Funds from operations(1) 6,959 3,420 1,543 782
Per share basic & diluted(1) 0.20 0.12 0.04 0.02
Net earnings (loss) 541 (1,356) (47) (467)
Per share basic & diluted(2) 0.02 (0.05) (0.00) (0.01)
Working capital (2,308) (798) (2,308) (798)
Capital expenditures(3) 15,228 17,507 3,415 4,216
Dispositions 4,130 - 3,130 -
Total assets 36,560 32,096 36,560 32,096
Shareholders' equity 26,600 25,846 26,600 25,846
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Notes:
(1) Funds from operations is a non-GAAP term and the Corporation calculates
this measure as cash provided from operations before changes in non-cash
operating working capital and asset retirement expenditures.
(2) At December 31, 2008 there were 550,000 options to purchase common
shares and 900,000 non-transferable common share warrants outstanding
that have not been included in the calculation of the weighted average
shares outstanding as the effect would be anti-dilutive.
(3) Excludes asset retirement obligations.


Operating Summary

----------------------------------------------------------------------------
Year Ended Three months ended
December 31, December 31,
2008 2007 2008 2007
----------------------------------------------------------------------------
Operating
Production
Crude oil & NGL's (bbls per day) 33 22 47 44
Natural gas (mcf per day) 4,688 3,638 5,021 4,416
BOE per day (6:1) 814 629 884 780

Netback per boe (6:1)
Petroleum and natural gas sales $ 49.85 $ 39.96 $ 44.16 $ 39.12
Royalties $ (10.17) $ (9.66) $ (9.08) $ (9.82)
Operating expenses $ (8.62) $ (7.79) $ (7.58) $ (9.19)
Transportation expenses $ (1.81) $ (1.53) $ (1.82) $ (1.51)
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Operating netback $ 29.25 $ 20.98 $ 25.68 $ 18.60
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Selected Reserves Information (1)(2)

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Total proved 2008 2007
----------------------------------------------------------------------------
Oil and NGL (mbbls) 206 295
Natural gas (mmcf) 8,525 5,446
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Total (mboe) 1,626 1,202
% Natural gas 87% 75%
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Total proved plus probable
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Oil and NGL (mbbls) 306 466
Natural gas (mmcf) 12,487 7,248
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Total (mboe) 2,387 1,674
% Natural gas 87% 72%
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Notes:
(1) The Corporation's reserves were independently evaluated by AJM Petroleum
Consultants ("AJM") as of December 31, 2008 in accordance with NI
51-101. Additional information on the Corporation's reserves can be
found in the Annual Information Form ("AIF") on SEDAR at www.sedar.com
or the Corporation's website at www.tritonenergy.ca.
(2) Gross reserves - the Corporation's working interest share prior to the
deduction of royalty obligations and inclusion of royalty interests.


Outlook

Triton has a 2009 capital expenditures budget of $12.0 million, which includes drilling up to eight (6.6 net) wells. Funding for this capital program is expected to be derived essentially from cash flows and available credit facilities. In the near term, petroleum and natural gas prices are expected to remain at or near their current multi-year lows, reflecting the broadening impact of the world economic recession. Petroleum and natural gas producers in Alberta are also feeling the effects of the new royalty regime that came into effect January 1, 2009. As a result, cash flows in 2009 are expected to be significantly lower than last year and less than originally anticipated when the Corporation's 2009 capital expenditures budget was set. In the interests of fiscal restraint and financial responsibility, Triton has postponed some of its exploration plans until the second half of the year.

To date in 2009, the Corporation has drilled two (2.0 net) operated wells resulting in one (1.0 net) natural gas well and one (1.0 net) dry hole. Triton currently plans to tie-in the successful natural gas well during the summer, subject to more favourable natural gas pricing.

Additionally, the Corporation is participating in a potentially high impact, deep test well in the Tay River area in the foothills of Alberta that commenced drilling on January 6, 2009 (the "Test Well").

The Test Well, located at 16-27-35-11W5M, is licensed to a total depth of 5,462 meters and is targeting a Leduc reef formation identified on 3-D seismic. Geological and seismic interpretation suggests that the Test Well is targeting a structure similar in size to the structure that hosts the Tay River Leduc gas pool located approximately 12 kilometers north-northeast of the Test Well. The Test Well reached the first intermediate casing point in early March and total depth is expected to be reached in May.

Upon fulfillment of its earning obligations Triton will have a 12.5% working interest in the Test Well, Section 27-35-11W5M and ten (10) additional contiguous sections of land. A major oil and gas producer is the operator of the Test Well.

Limited access to both equity and debt markets, continuing weakness in petroleum and natural gas prices and increased royalties in Alberta have lead to a growing expectation of consolidation in the junior energy sector. This is particularly true with respect to companies having excessive debt levels. Several deals have been announced so far this year and we believe other opportunities will come available during 2009. Triton primarily targets corporate acquisitions that would augment our organic growth with an immediate increase in production and reserves, thereby increasing cash flows and access to credit facilities that could be used toward funding the Corporation's capital expenditures program. We have already evaluated several opportunities this year and will continue to do so.

Triton is a Calgary, Alberta based corporation engaged in the exploration, development and production of petroleum and natural gas. The Corporation's common shares are listed on the TSX Venture Exchange under the trading symbol "TEZ".

Advisories

This news release may include forward-looking statements including opinions, assumptions, estimates and management's assessment of future plans and operations, budgeted capital expenditures and the method of funding thereof, the number and location of wells to be drilled, the timing of drilling of wells, the timing of completion and tie-in of wells and the effects of the recession and the new royalty regime in Alberta on expected cash flows of the Corporation in 2009. When used in this document, the words "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "plan", "should" and similar expressions are intended to be among the statements that identify forward-looking statements. Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Corporation believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to, risks associated with oil and gas exploration, development, exploitation, results from testing, production, marketing and transportation, the volatility of oil and gas prices, currency fluctuations, the ability to implement corporate strategies, the state of domestic capital markets, the ability to obtain financing, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, changes in oil and gas acquisition and drilling programs, delays resulting from inability to obtain required regulatory approvals, delays resulting from inability to obtain drilling rigs and other services, delays in tie-in operations, results from testing, environmental risks, competition from other producers, imprecision of reserve estimates, changes in general economic conditions and other factors more fully described from time to time in the reports and filings made by Triton with securities regulatory authorities. Readers are cautioned not to place undue reliance on forward-looking statements, as no assurances can be given as to future results, levels of activity or achievements. Except as required by applicable securities laws, the Corporation does not undertake any obligation to publicly update or revise any forward-looking statements.

Finding and development ("F&D") costs are calculated by dividing the sum of exploration and development costs incurred in the most recent financial year plus the change during the most recent financial year in estimated future development costs relating to the reserves in question, by the reserve additions being considered (being proved or proved and probable reserves) on a barrels of oil equivalent basis. The aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserve additions for that year. The three-year average of F&D costs (including changes in future development costs) was $22.01 and $16.56 on a proved and a proved plus probable basis, respectively.

While Triton's geological and seismic interpretation suggests that the Test Well is targeting a structure similar in size to the structure that hosts the Tay River Leduc gas pool located approximately twelve kilometers to the north-northeast, there is no assurance that the Test Well will be successful or have similar results to wells in the Tay River Leduc gas pool.

The net present value of future net revenue may not represent fair market value.

Disclosure provided herein in respect of barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil 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 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 release.

Contact Information

  • Triton Energy Corp.
    Michael S. Zuber
    President & CEO
    (403) 266-5541 ext. 222
    (403) 266-5579 (FAX)
    Email: mzuber@tritonenergy.ca
    or
    Triton Energy Corp.
    Dean J. Schultz
    Vice President, Finance & CFO
    (403) 266-5541 ext. 229
    (403) 266-5579 (FAX)
    Email: dschultz@tritonenergy.ca