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Mart Announces Financial and Operating Results for the Three

Mart Announces Financial and Operating Results for the Three and Nine
Months Ended September 30, 2012 and Declaration of Dividend 
CALGARY, ALBERTA -- (Marketwire) -- 11/26/12 -- Mart Resources, Inc.
(TSX VENTURE:MMT) ("Mart" or the "Company") is pleased to announce
its financial and operating results for the three and nine months
ended September 30, 2012 ("Q312") (all amounts in Canadian dollars
unless noted): 
THREE MONTHS ENDED SEPTEMBER 30, 2012 


 
--  On August 29, 2012, Mart declared a dividend of $0.05 per common share
    that was paid to shareholders on October 2, 2012 for an aggregate amount
    of $17.8 million. 
    
--  Mart's working capital position at September 30, 2012 was $36.9 million
    (after taking into account the dividend paid on October 2, 2012).  
    
--  Net income for the three months ended September 30, 2012 ("Q312") was
    $21.5 million ($0.061 per share) compared to net income of $18.7 million
    ($0.056 per share) for the three months ended September 30, 2011
    ("Q311"). The increase in net income was due to an increase in the
    number of barrels produced and sold during Q312 compared Q311. 
    
--  Funds flow from production operations of $44.8 million ($0.127 per
    share) for Q312 compared to $42.1 million ($0.125 per share) for Q311
    (see Note 1 to the Financial and Operating Results table below regarding
    Non-IFRS measures).  
    
--  Mart's share of Umusadege field oil produced and sold in Q312 was
    615,686 barrels of oil ("bbls") compared to 446,981 bbls for Q311. The
    increase in volumes is primarily attributable to Mart's overall increase
    in production year over year. 
    
--  The average sales price in Q312 was approximately USD $108.40 per bbl
    (CDN $106.58 per bbl) compared to USD $112.54 per bbl (CDN $114.79 per
    bbl) for Q311.  
    
--  Mart's average share of daily oil produced and sold for Q312 from the
    Umusadege field was 6,692 barrels of oil per day ("bopd") compared to
    4,858 bopd for Q311, again higher primarily because Mart's year over
    year production increases. 
    
--  During Q312, the Umusadege field was shut-in for 5 days (Q311 - 11 days)
    due to disruptions in the export pipeline, well testing activities and
    maintenance and modification of production facilities. 
    
--  Pipeline and export facility losses for September 2012 as reported by
    Nigerian Agip Oil Company ("AGIP"), the operator of the export pipeline,
    were 40,018 bbls or approximately 11.6% of total crude deliveries.
    Losses for Q312 totaled 148,020 bbls, or approximately 13.1% of total
    crude deliveries. Pipeline and export facility losses as reported by
    pipeline operator from the beginning of the year to end of September
    2012 are approximately 13.1% of total crude deliveries during this nine
    month period. 
    
 
NINE MONTHS ENDED SEPTEMBER 30, 2012                                        
 
--  On June 28, 2012, Mart declared a dividend of $0.10 per common share
    that was paid to shareholders on August 8, 2012 for an aggregate amount
    of $35.6 million. 
    
--  Net income for the nine months ended September 30, 2012 was $62.0
    million ($0.181 per share) compared to net income of $47.3 million
    ($0.141 per share) for the nine months ended September 30, 2011. 
    
--  Funds flow from production operations of $121.7 million ($0.356 per
    share) for the nine months ended September 30, 2012 compared to $107.2
    million ($0.319 per share) for the same period in 2011 (see Note 1 to
    the Financial and Operating Results table page 3 regarding Non-IFRS
    measures). 
    
--  Mart's share of Umusadege field oil produced and sold for the nine
    months ended September 30, 2012 was 1,655,526 bbls compared to 1,344,611
    bbls for the nine months ended September 30, 2011. 
    
--  The average sales price received by Mart for oil for the nine months
    ended September 30, 2012 was approximately USD $104.49 per bbl (CDN
    $102.73) compared to USD $100.05 per bbl (CDN $102.05 per bbl) for the
    comparable period in 2011. 
    
--  Mart's average share of daily oil produced and sold from the Umusadege
    field was 6,042 bopd for the nine months ended September 30, 2012
    compared to 4,925 bopd for the nine months ended September 30, 2011. 
    
--  During the first nine months of 2012, the Umusadege field was shut-in
    for a total of 32 days compared to 33 days for the comparable period in
    2011 due to disruptions in the export pipeline, well testing activities
    and maintenance and modification of production facilities. 

 
FINANCIAL AND OPERATING RESULTS  
The following table provides a summary of Mart's selected financial
and operating results for the three months and nine months ended
September 30, 2012 and 2011 and the twelve months ended December 31,
2011: 


 
CDN $ 000's                            3 months ended        3 months ended 
(except oil produced and sold,                                              
 share, oil prices and per share                                            
 amounts)                          September 30, 2012    September 30, 2011 
----------------------------------------------------------------------------
Mart's share of the Umusadege Field:                                        
Barrels of oil produced and sold              615,686               446,981 
Average sales price per barrel        $        106.58       $        114.79 
Mart's percentage share of total                                            
 Umusadege oil produced and sold                                            
 during the period                                 63%                   63%
Mart's share of petroleum sales                                             
 after royalties                      $        53,251       $        46,776 
                                                                            
Funds flow from production                                                  
 operations (1)                       $        44,842       $        42,092 
Per share - basic                     $         0.127       $         0.125 
                                                                            
Net income (2)                        $        21,450                18,690 
Per share - basic (2)                 $         0.061       $         0.056 
Per share - diluted (2)               $         0.060       $         0.055 
                                                                            
Total assets (2)                      $       246,676       $       177,402 
                                                                            
Total bank debt                       $           Nil       $         6,372 
                                                                            
Weighted average shares outstanding for period:                             
                                                                            
                                                                            
Basic                                     352,804,579           336,048,202 
                                                                            
                                                                            
Diluted                                   357,922,013           342,682,678 
                                                                            
 
                                                                  12 mo
nths 
CDN $ 000's                     9 months ended 9 months ended         ended 
(except oil produced and sold,                                              
 share, oil prices and per share September 30,  September 30,  December 31, 
 amounts)                                 2012           2011          2011 
----------------------------------------------------------------------------
Mart's share of the Umusadege                                               
 Field:                                                                     
Barrels of oil produced and sold     1,655,526      1,344,611     1,803,459 
Average sales price per barrel   $      102.73  $      102.05 $      102.08 
Mart's percentage share of total                                            
 Umusadege oil produced and sold                                            
 during the period                          65%            67%           71%
Mart's share of petroleum sales                                             
 after royalties                 $     143,470  $     121,487 $     162,431 
                                                                            
Funds flow from production                                                  
 operations (1)                  $     121,667  $     107,202 $     144,129 
Per share - basic                $       0.356  $       0.319 $       0.429 
                                                                            
Net income (2)                   $      61,969  $      47,304 $      71,801 
Per share - basic (2)            $       0.181  $       0.141 $       0.214 
Per share - diluted (2)          $       0.175  $       0.138 $       0.209 
                                                                            
Total assets (2)                 $     246,676  $     177,402 $     198,021 
                                                                            
Total bank debt                  $         Nil  $       6,372 $         Nil 
                                                                            
Weighted average shares outstanding for period:                             
                                                                            
Basic                              342,233,799    335,920,607   336,084,275 
                                                                            
Diluted                            353,826,708    343,809,907   344,318,066 

 
Notes:   
(1) Indicates non-IFRS measures. Non-IFRS measures are informative
measures commonly used in the oil and gas industry. Such measures do
not conform to IFRS and may not be comparable to those reported by
other companies nor should they be viewed as an alternative to other
measures of financial performance calculated in accordance with IFRS.
For the purposes of this table, the Company defines "Funds flow from
production operations" as net petroleum sales less royalties,
community development & other costs and production costs. Funds flow
from production operations is intended to give a comparative
indication of the Company's net petroleum sales less production costs
as shown in the following table. 
(2) For comparative purposes, net income for the three months ended
September 30, 2011 and the nine months ended September 30, 2011
includes adjustments for corrections to general and administrative,
share-based compensation, depreciation, depletion, income tax
expense, deferred income tax expense, foreign currency translation
gains (losses), net income, total comprehensive income, earnings per
share - basic and earnings per share - diluted. Each of the first
three quarters of 2011 contains adjustments to correct the foregoing
items. The audited Consolidated Financial Statements for the years
ended December 31, 2011 and December 31, 2010 are unaffected by these
adjustments and remain unchanged. Details of these changes are set
out in Note 11 of the unaudited Condensed Consolidated Financial
Statements for the three months and nine months ended September 30,
2012. 


 
                         3 months   3 months   9 months   9 months 12 months
                            ended      ended      ended      ended     ended
                        September  September  September  September  Dec. 31,
CDN $ 000's              30, 2012   30, 2011   30, 2012   30, 2011      2011
----------------------------------------------------------------------------
Petroleum sales        $   65,620 $   51,309 $  170,074 $  137,217 $ 184,100
Less: Royalties and                                                         
community development                                                       
 contributions             12,369      4,533     26,604     15,730    21,669
----------------------------------------------------------------------------
Net petroleum sales        53,251     46,776    143,470    121,487   162,431
Less: Production costs      8,409      4,684     21,803     14,285    18,302
----------------------------------------------------------------------------
Funds flow from                                                             
 production operations $   44,842 $   42,092 $  121,667 $  107,202 $ 144,129
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
DISCUSSION OF Q312 RESULTS: 
Production in the third quarter of 2012 remained steady and there
were no unusual shutdowns of the pipeline or production facilities.
There were five liftings of oil from the Umusadege field in Q312.
Mart's Q312 petroleum sales before royalties and community
development contributions were $ $65.6 million, compared to $51.3
million in Q311. Mart's share of petroleum produced and sold from the
Umusadege field for Q312 was 615,686 bbls, compared to 446,981 bbls
for Q311. Mart's average sale price per barrel for Q312 decreased by
CDN $8.21 per bbl to CDN $106.58 compared to the average sales price
of CDN $114.79 for Q311.  
Mart's petroleum sales for the nine months ended September 30, 2012
before royalties and community development contributions were $170.1
million, compared to $137.2 million for the same period in 2011.
Mart's share of petroleum produced and sold from the Umusadege field
for the first nine months of 2012 was 1,655,526 bbls, compared to
1,344,611 bbls for the first nine months of 2011. Mart's average
sales price per barrel for the nine months ended September 30, 2012
increased by CDN $0.68 per bbl to CDN $102.73 compared to the average
sales price of CDN $102.05 for the nine months ended September 30,
2011.  
At the end of the third quarter, Mart's share in an over-nominated
oil position was 25,000 bbls. Over-nominated oil is oil that had been
nominated, but not paid for and not delivered. The price of oil on
September 30, 2012 was USD 110.17 per bbl.  
The increase in Mart's net income from Q311 to Q312 is primarily
attributable to increased revenues and lower income tax expense. The
increase in funds flow from operations is due to production increases
outpacing the increase of related expenses.  
Mart's share of production sold from the Umusadege field under its
agreement with its co-venturers varies from 50% to 82.5% of
production. In the third quarter Mart's average share of total
Umusadege oil produced and sold was 63% (compared to 63% in Q311 and
52% in Q212). 
Mart and its co-venturers bear their proportionate share of pipeline
losses, but these line losses are determined by the pipeline
operator. For oil delivered in the third quarter, the pipeline owner
attributed losses of oil delivered through the AGIP pipeline at
approximately 13%. Mart and its co-venturers continue to work to
obtain additional information with respect to these losses, including
assessing the accuracy of volume reconciliations, and the accuracy of
the metering and reporting processes. However, Mart and its
co-venturers rely on the pipeline operator to provide this
information. The significance of these line losses underscores the
importance to Mart and its co-venturers of continuing to advance the
construction of a new pipeline for delivery of the oil produced from
Umusadege. 
DECLARATION OF DIVIDEND: 
Mart is pleased to announce that its Board of Directors declared a
quarterly cash dividend of $0.05 per common share. The dividend is
pay
able on January 8, 2013 to shareholders of record at the close of
business on December 21, 2012. The ex-dividend date is December 19,
2012.  
Pursuant to the Company's dividend policy, the declaration of regular
quarterly dividends is determined quarterly based on Mart's cash
flows, liquidity, capital expenditure budgets, earnings, financial
condition and other factors as the Board of Directors may consider
appropriate from time to time. 
OUTLOOK AND OPERATIONS UPDATE:  
On August 29, 2012, Mart declared a quarterly cash dividend of $0.05
per common share that was paid to shareholders on October 2, 2012 for
an aggregate amount of $17.8 million. 
The UMU-10 well commenced drilling on July 4, 2012 reached a total
drilling depth of approximately 9,757 feet at the beginning of
October 2012. UMU-10 is an appraisal well targeting the sands
encountered in the UMU-9 exploration/step-out well, including the
deep sand discoveries. Based upon logging results, the UMU-10 well
encountered a total of 479 feet of gross pay in 20 sands. The
reservoirs encountered are consistent with those encountered in the
UMU-9 well, with one additional oil-bearing discovery in the UMU-10
well that was wet in UMU-9. The five deep sand discoveries
encountered in UMU-9, along with the additional oil reservoir
encountered in UMU-10, have not previously been flowed to surface.
These are the primary testing and completion targets for the UMU-10
well. 
Downhole pressure and fluid sample tests were taken over all
reservoirs. Preliminary evaluations for the UMU-10 well indicate 19
light oil reservoirs and one gas/condensate reservoir. These
conclusions are consistent with results of tests on the UMU-9 well.
The down-hole fluid samples have confirmed hydrocarbon type, and will
provide critical information for reservoir management and field
development planning. 
The completion program and production testing operations on the
UMU-10 well will continue through November 2012. Six of the sands,
XVIIa & XVIIb (commingled), XVIIIa, XIX, XXb, and XXI, will be
perforated, tested, and completed for production. Any two of these
zones can be produced simultaneously using dual string sliding sleeve
completion technology. The sands completed in UMU-10 will access 161
feet of the total 479 feet of gross pay in the well. 
Umusadege field production during the month of October 2012 averaged
10,217 bopd. Umusadege field downtime during October 2012 was six
days. The average field production based on producing days was 12,669
bopd. Total crude oil deliveries into the export storage tanks from
the Umusadege field for the month of October 2012, before pipeline
losses, were approximately 317,000 bbls. AGIP has reported
approximately 40,000 bbls of pipeline losses during the month of
October, 2012 or approximately 11.6% of total crude deliveries. The
pipeline losses experienced in Q312 and to date in Q312 are
approximately 13%.  
Mart and its co-venturers are continuing discussions with an
affiliate of Royal Dutch Shell plc, ("Shell") to complete a crude
handling agreement that will enable plans to move forward to provide
a second independent export pipeline for Umusadege field production.
Mart and its co-venturers will then gain access to Shell's export
facilities and a 50 kilometer pipeline will be constructed. 
AGIP, the export pipeline operator, temporarily closed its export
pipeline on October 30, 2012 due to leakages. AGIP advised Mart that
as a result of local flooding, it was unable to inspect the export
pipeline for damage, or commence repairs for two weeks following the
shutdown. AGIP has advised that it has commenced repair works on the
damaged sections of the pipeline. 
The Brass River Export Terminal, where oil production from the
Umusadege field is shipped, also experienced loading delays due to
extreme flooding in the area. As a consequence, AGIP declared force
majeure on loadings at the Brass River Export Terminal until the
flooding situation was rectified. AGIP has advised that the situation
is improved.  
As a consequence of the foregoing, all Umusadege field production
shipped through the AGIP export pipeline has been shut-in pending
AGIP's ability to access, inspect and repair the export pipeline and
rectify the flooding situation at the Brass River Export Terminal.  
CHAIRMAN'S COMMENT: 
Wade Cherwayko, Chairman and CEO of Mart said, "Mart has experienced
strong financial and operating results through the first nine months
of 2012 with $62 million of net income year to date or $0.18 per
share. These results reflect the ongoing growth of the Umusadege
field's production capacity and the Company's continuing efforts to
work towards maximizing production and efficiency. On the operational
front, drilling of the UMU-10 well proceeded during the quarter and
was completed shortly following the end of Q3. I am pleased with the
preliminary results of UMU-10 well, which have confirmed the
significant undeveloped reserves potential in the eastern extension
of the field. The geology of the Umusadege field continues to provide
new and exciting opportunities for future development and
exploration. The third quarter also saw significant progress being
made on negotiations with an affiliate of Royal Dutch Shell to
complete a crude handling agreement. The signing of the crude
handling agreement will enable Mart and its co-venturers to proceed
with plans to construct a new export pipeline connecting the
Umusadege field to Shell's affiliate's export pipeline in Eriemu. 
"During October 2012, Mart and its co-venturers continued to enjoy
steady production from the Umusadege field with 317,000 bbls of oil
nominated and delivered in early November 2012. Unfortunately, damage
to the AGIP export pipeline and flooding in the Niger Delta resulted
in the pipeline operator shutting down the pipeline on October 30,
2012. Mart has been advised by AGIP that it has recently been able to
inspect the pipeline and to commence repairs on the damaged sections.
Loading delays due to flooding have also been experienced subsequent
to Mart's latest lifting at the Brass River Export Terminal, though
it is Mart's understanding that this situation has now been largely
rectified. Pipeline losses have continued, amounting to approximately
13% of total crude deliveries to date through Q312. Mart and its
co-venturers are continuing to monitor this situation.  
"We were very pleased to have paid an initial $0.10 per share
dividend to shareholders in early August and a second $0.05 per share
quarterly dividend in early October, 2012. Despite the recent
challenges, Mart continues to enjoy a strong balance sheet and cash
position and is pleased to announce a quarterly dividend of $0.05 per
share payable in January 2013 in accordance with our dividend
policy." 
For more information, please contact Wade Cherwayko / Dmitri Tsvetkov
at Mart's London, England office # +44 207 351 7937 or e-mail:
Wade@martresources.com / dmitri.tsvetkov@martresources.com. Mart's
Condensed Consolidated Financial Statements (unaudited) for the nine
months ended September 30, 2012 and 2011 and the accompanying
Management's Discussion and Analysis are available on the company's
website at www.martresources.com and under the Company's profile on
SEDAR at www.sedar.com. 
Email: Note: Except where expressly stated otherwise, all production
figures set out in this press release, including bopd, reflect gross
Umusadege field production rather than production attributable to
Mart. Mart's share of total gross production before taxes and
royalties from the Umusadege field fluctuates between 82.5% (before
capital cost recovery) and 50% (after capital cost recovery). 
Forward Looking Statements 
Certain statements contained in this press release constitute
"forward-looking statements" as such term is used in applicable
Canadian and US securities laws. Any statements that express or
involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions or future events
or are not statements of historical fact and should be viewed as
"forward-looking statements". These statements relate to analyses and
other information that are based upon forecasts of future results,
estimates of amounts not yet determinable and assumptions of
management. Such forward looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements.  
In particular, statements (express or implied) contained herein or in
Mart's MD&A regarding the following should be considered
forward-looking statements: the Company's goals and growth strategy,
estimates of reserves and future net revenues, exploration and
development activities in respect of the Umusadege field, the
Company's ability to finance its drilling and development plans with
cash flows from operations, the a
bility of the Company to
successfully drill and complete future wells, the ability of the
Company to commercially produce, transport and sell oil from the
Umusadege field, future anticipated production rates, export pipeline
capacity available to the Company, the expectation of the Company
that production and export pipeline disruptions will not have a
lasting impact on the Company's future production and will be
resolved within the timeframes indicated, timing of completion of the
Company's upgrading of the central production facility, the
construction and completion of an alternative export pipeline, the
acceptance of the Company's tax filings by the Nigerian taxing
authorities, treatment under government regulatory regimes including
royalty and tax laws, projections of market prices and costs, supply
and demand for oil, timing for receipt of government approvals, and
the ability of the Company to satisfy its current and future
financial obligations to its banks and other creditors. In addition,
Mart cannot predict the extent of any pipeline losses that may occur
and be borne by Mart in the future, and the effect these will have on
net income and cash flow.  
There is no assurance that future dividends will be declared or the
timing or amount of any future dividend. The payments of dividends or
distributions in the future are within the discretion of Mart's Board
of Directors and are dependent on numerous factors including the
Company's cash flow, capital expenditure budgets, earnings, financial
condition, the satisfaction of the applicable solvency test in the
Company's governing statute (the Business Corporations Act
(Alberta)), and such other factors as the Board of Directors may
consider appropriate from time to time. Mart's ability to continue to
pay dividends in the future is also subject to many other factors
including falling commodity prices, repatriation restrictions,
disruptions or reductions in production or collection of receivables
following sales of production. Dividend payments to shareholders will
be subject to applicable statutory deductions and tax withholdings
prescribed by applicable law. 
There can be no assurance that such forward-looking statements will
prove to be accurate as actual results and future events could vary
or differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements contained in this news release. This
cautionary statement expressly qualifies the forward-looking
statements contained herein. 
Forward-looking statements are made based on management's beliefs,
estimates and opinions on the date the statements are made and the
Company undertakes no obligation to update forward-looking statements
and if these beliefs, estimates and opinions or other circumstances
should change, except as required by applicable law. 
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 THE RELEASE. 
Contacts:
Investors are also welcome to contact one of the following
investor relations specialists for all corporate updates and
investor inquiries: INVESTOR RELATIONS
FronTier Consulting Ltd., Attn: Sam Grier or Timea Carlsen
Mart toll free # 1-888-875-7485
inquiries@martresources.com