Exall Energy Corporation announces results for the three and nine months ended September 30, 2013

Exall Energy Corporation announces results for the three and nine months ended 
September 30, 2013 
CALGARY, Nov. 14, 2013 /CNW Telbec/ - Exall Energy Corporation ("Exall" or the 
"Company") (TSX:EE and TSX:EE.DB) is pleased to announce its financial and 
operating results for the three and nine months ended September 30, 2013. 
Exall's public filings can all be found at www.exall.com or www.sedar.com. 
Highlights: 


    --  A third quarter 2013 production average of 1,116 boe per day, a
        13 percent increase over the same quarter in 2012, and the
        fourth highest quarterly average in the Company's history.
    --  A third quarter 2013 Net Back of $49.70.
    --  A third quarter 2013 cash flow from operations of $2,893,000.
    --  A third quarter 2013 net corporate debt reduction of
        $2,280,000.

HIGHLIGHTS                     Three months ended    Nine months ended
                                     September 30       September 30  
                                                %                    %

In thousands of dollars         2013  2012 change   2013   2012 change

Financial ($)                                                         

Gross revenue                  9,999 7,060     42 28,956 23,458     23

Funds from operations          2,893 3,291   (12) 11,375 11,707    (3)
        Basic per share         0.04  0.05   (20)   0.17   0.19   (11)
        Diluted per share       0.01  0.05   (80)   0.05   0.19   (74)

Net income (loss)              (373)   588  (163)    874  2,862   (69)
        Basic per share       (0.01)  0.01  (200)   0.01   0.05   (80)
        Diluted per share     (0.01)  0.01  (200)   0.01   0.05   (80)

Capital expenditures, net        221 7,051   (97)  8,080 39,960   (80)
                                                                 

HIGHLIGHTS                     Three months ended    Nine months ended
                                    September 30        September 30  
                                                %                    %
                                2013  2012 change   2013   2012 change

Operations                                                            

Daily production                                                      
        Crude oil (bbl)        1,030   897     15  1,110    968     15
        Natural gas liquids                                          -
        (bbl)                     17    16      6     19     19
        Natural gas (mmcf)       417   471   (11)    385    511   (25)

Total daily production (boe @
6:1)                           1,116   991     13  1,193  1,072     11

Netback per boe (6:1) ($)      49.70 51.73    (4)  49.73  53.14    (6)

Corporate Developments

Outlook

Capital expenditures planned for the third quarter were largely postponed due 
to the ongoing process of restructuring the senior debt of the Company to 
comply with the desire of the senior lender to reduce their outstanding 
principal amount. Capital expenditures during the third quarter of 2013 were 
focused on maintaining the production momentum built through the first half of 
2013 through minor workovers and pump and rod repairs. Q3 production from 
field estimates averaged 1,125 BOEPD as compared to Q2 average production of 
1,161 BOEPD. Renewed drilling planned for Q4 is expected to add to those 
volumes. Preparations are under way to begin drilling in the early part of Q4.

http://files.newswire.ca/357/Exall_Energy.pdf

Capital expenditures through Q4 2013 and Q1 2014 will focus on the 
"low-hanging fruit" (LHF) opportunities. Initial planned drilling activities, 
which were commence in October, are two sidetrack wells of wells in the North 
Waterflood which were drilled and completed in Q1 2013. The locations were 
chosen on the basis of the sand thickness penetrated and potential from 
improved sand quality and production in the targeted sidetrack locations. Both 
wells had been fracture stimulated but did not produce at the rates expected 
after this type of treatment. One of the wells will also provide further 
validation of the 3D seismic signature as it is directed at the second 
derivative target at the north end of current well control. Two additional 
infill locations between the North and Central Waterflood areas also planned 
through to breakup next year. These wells are all high-impact, low risk 
locations identified through previous drilling and could have a significant 
impact on the Company's production if successful.

Other LHF opportunities include a recently approved water injection well in a 
previously unsupported part of the South Waterflood. That portion of the 
waterflood had been producing 90 BOEPD (65 BOPD net), however, since the 
installation of additional casing gas compressors the planned injection well 
is producing over 100 BOEPD and the project a total of 220 BOEPD (160 BOPD 
net) with one additional re-activation candidate. The Company is reviewing the 
planned scheme with a view to change the planned injection location to take 
advantage of the apparent support from another offsetting injection well. 
Other LHF opportunities include sand cleanouts on a number of horizontal 
wells, re-completions and re-activations to be completed through year-end, as 
well as the implementation of one additional water injection well.

As noted in the Q1 and Q2 Outlook, the 11-31 well was cased through the 
Wabamun for further testing. While the Company was aware that a vertical, 
fracture stimulated completion was likely to produce high water cuts, the 
intent was to prove movable light hydrocarbon presence in this area, which is 
located 4.5 km and 16 meters higher structurally than the area tested earlier 
by Exall. The company engaged Sayers Securities to pursue joint ventures or 
farmin proposals for the project. The public market does not currently reflect 
value for the Wabamun play and any interest in the project will bolster our 
valuation in that regard. The initiative generated considerable interest in 
the market; however no formal proposal was received, largely due to the lack 
of risk capital available in the equity market.

As at September 30, 2013, the Company had a working capital surplus, excluding 
bank indebtedness, of $0.1 million, and was in compliance with all covenants 
on the April 30, 2013 expired loan agreement. While the bank has not informed 
the Company that it intends to demand the loan, the bank's annual review of 
the credit facility is ongoing. Although the Company expects that the bank 
will extend the facility in 2013, the extension is expected to be at a level 
less than the $36.0 million facility amount and on different terms and a 
portion of the facility may have to be repaid in the near term. Should this 
be the case, the Company will require alternative forms of debt or equity 
financing or will need to dispose of certain assets to repay the outstanding 
indebtedness. The Company, as at November 13, 2013 was in discussions with 
the bank and other potential lenders in regards to ongoing debt financing and 
will continue to adjust the scope of its development plans and anticipated 
expenditures in light of its working capital position. The failure of the 
Company to appropriately re-finance its credit facility would limit the 
ability of the Company to advance its overall business plan.

Overview

Exall's average daily production for the third quarter of 2013 increased 13 
percent to 1,116 barrels of oil equivalent per day ("BOEPD") from 991 BOEPD in 
the third quarter of 2012. As at November 13, 2013 Exall's net production rate 
was as outlined below:
                                                                

PRODUCTION BY        ESTIMATED Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012
REGION
                       Q4 2013

Mitsue Waterfloods                                                    

  Oil         bbls/d     1,068   1,028   1,082   1,216   1,041     884

  Natural Gas mmcf/d       293     417     343     394     297     209

  Liquids                    7      17      20      19      14       8
  (bbls/d)    bbls/d
               BOEPD     1,123   1,114   1,160   1,301   1,105     927

Bow Island                                                            
Heavy Oil                     

  Oil         bbls/d         2       2       2       2       2       2

  Natural Gas mmcf/d         -       -       -       -       -       -

  Liquids     bbls/d         -       -       -       -       -       -
               BOEPD         2       2       2       2       2       2

Corporate                                                             
Totals                        

  Oil         bbls/d     1,070   1,030   1,084   1,218   1,042     897

  Natural Gas mmcf/d       293     417     343     394     297     471

  Liquids     bbls/d         7      17      20      19      14      16
               BOEPD     1,125   1,116   1,161   1,303   1,106     991

Exall's estimated fourth quarter 2013 average daily production at November 13, 
2013 is approximately 1,125 BOEPD.

Results of Operations

Oil and gas exploration and development expenditures were $162 for the third 
quarter of 2013. During the third quarter of 2013 the Company did not 
participate in the drilling of any oil wells in the Marten Mountain / Mitsue 
area. Oil and gas property expenditures were $5,028 for the third quarter of 
2012. During the third quarter of 2012 the Company spud 3.0 gross wells 
(2.17 net) in the Marten Mountain / Mitsue area.

Oil and gas exploration and development expenditures were $8,127 for the nine 
months ended September 30, 2013. During the nine month period ended of 2013 
the Company participated in the drilling of 2.0 gross oil wells (1.59 net) in 
the Marten Mountain / Mitsue area. Oil and gas property expenditures were 
$38,052 for the nine month period ended September 30, of 2012. During the 
nine month period ended September 30, 2012 the Company spud 8.0 gross wells 
(5.45 net) in the Marten Mountain / Mitsue area.

As at September 30, 2013, the Company had 189,120 acres (140,843 acres net) of 
undeveloped land in Alberta, Canada.

Exall realized the following netbacks from oil and gas operations:
                                                                
                           THREE MONTHS ENDED  NINE MONTHS ENDED
                                SEPTEMBER 30,      SEPTEMBER 30,
                                            %                  %

NETBACK PER BOE (6:1) $     2013  2012 CHANGE  2013  2012 CHANGE
                                                                

Production revenue         97.41 77.43     26 88.94 79.90     11

Royalties                  36.27 13.28    173 27.95 13.55    106

Operating expenses         11.44 12.42    (8) 11.26 13.21   (15)

Operating netbacks ($/boe) 49.70 51.73    (4) 49.73 53.14    (6)

Financial Contracts         5.83     -    100  1.84     -    100

Administrative expenses     5.14  6.50   (21)  4.82  4.94    (2)

Abandonment expenses           -     -      -     -  1.20  (100)

Interest expenses          10.55  9.14     15  8.13  6.96     17

Corporate netbacks ($/boe) 28.18 36.09   (35) 34.94 40.04   (13)

Operating netbacks in the third quarter of 2013 decreased 4 percent to $49.70 
per boe compared to the third quarter 2012 operating netbacks of $51.73 per 
boe. This is the result of the overall royalty expense increase of 173 
percent on a third quarter over third quarter basis as a result of wells 
having produced out their allowable production under the NOWPP and reverting 
from a 5% rate to the Alberta maximum Royalty Rate of 40% with no new wells 
being brought on at the 5% NOWPP rate.

Operating netbacks for the nine month period ending September 30, 2013 
decreased 6 percent to $49.73 per boe compared to the nine month period ending 
September 30, 2012 operating netbacks of $53.14 per boe. This is the result 
of the overall royalty expense increase of 106 percent on a nine month over 
nine month basis as a result of wells having produced out their allowable 
production under the NOWPP and reverting from a 5% rate to the Alberta maximum 
Royalty Rate of 40% with 2 new wells being brought on at the 5% NOWPP rate.

Corporate netbacks in the third quarter of 2013 decreased 22 percent to $28.18 
per boe compared to the third quarter 2012 corporate netbacks of $36.09 per 
boe. This is the result of 1) the overall royalty expense increase of 173 
percent on a third quarter over third quarter basis as a result of wells 
having produced out their allowable production under the NOWPP and reverting 
from a 5% rate to the Alberta maximum Royalty Rate of 40% with no new wells 
being brought on at the 5% NOWPP rate, 2) the loss on financial contracts 
incurred during the third quarter, the Canadian $99.05 WTI Hedge resulted in a 
loss during the quarter as a result of geo-political risks increasing the 
price of WTI during the quarter, prices that have now reversed, and 3) the 
overall interest expense increase of 15 percent on a third quarter over third 
quarter basis.

Corporate netbacks for the nine month period ending September 30, 2013 
decreased 13 percent to $34.94 per boe compared to the nine month period 
ending September 30, 2012 corporate netbacks of $40.04 per boe. This is the 
result of 1) the overall royalty expense increase of 106 percent on a nine 
month over nine month basis as a result of wells having produced out their 
allowable production under the NOWPP and reverting from a 5% rate to the 
Alberta maximum Royalty Rate of 40% with 2 new wells being brought on at the 
5% NOWPP rate, 2) the loss on financial contracts incurred during the third 
quarter, the Canadian $99.05 WTI Hedge resulted in a loss during the third 
quarter as a result of geo-political risks increasing the price of WTI during 
the quarter, prices that have now reversed, and 3) the overall interest 
expense increase of 17 percent on a third quarter over third quarter basis.

Net income, as a result, for the third quarter of 2013 was negative $373,000 
or a loss of $0.01 per share compared to a net income for the third quarter of 
2012 of $588,000 or $0.01 per share.

About Exall

Exall is a junior oil and gas company active in its business of oil and gas 
exploration, development and production from its properties in Alberta. Exall 
Energy is currently developing the new Mitsue area "Marten Mountain" discovery 
in north-central Alberta.

Exall Energy currently has 66,634,854 common shares outstanding. The Company's 
common shares are listed on the Toronto Stock Exchange under the trading 
symbol EE. The Company's convertible debentures are listed on the Toronto 
Stock Exchange under the trading symbol EE.DB.

Reader Advisory

This news release contains forward-looking statements, which are subject to 
certain risks, uncertainties and assumptions, including those relating to 
results of operations and financial condition, capital spending, financing 
sources, commodity prices and costs of production. By their nature, 
forward-looking statements are subject to numerous risks and uncertainties 
that could significantly affect anticipated results in the future and, 
accordingly, actual results may differ materially from those predicted. A 
number of factors could cause actual results to differ materially from the 
results discussed in such statements, and there is no assurance that actual 
results will be consistent with them. Such factors include 
fluctuatingcommodity prices,capital spending and costs ofproduction, and 
other factors described in the Company's most recent Annual Information Form 
under the heading "Risk Factors" which has been filed electronically by means 
of the System for Electronic Document Analysis and Retrieval ("SEDAR") located 
at www.sedar.com. Such forward-looking statements are made as at the date of 
this news release, and theCompany assumes no obligation to update or revise 
them, either publicly or otherwise, to reflect new events, information or 
circumstances, except as may be required under applicable securities law.

For the purposes of calculating unit costs, natural gas has been converted to 
a barrel of oil equivalent (boe) using 6,000 cubic feet equal to one barrel 
(6:1), unless otherwise stated. The boe conversion ratio of 6 mcf: 1 bbl is 
based on an energy equivalency conversion method and does not represent a 
value equivalency; therefore boe may be misleading if used in isolation. This 
conversion conforms to the Canadian Securities Regulators' National Instrument 
51-101 - Standards of Disclosure for Oil and Gas Activities.



SOURCE  EXALL ENERGY CORPORATION 
Exall Energy Corporation 
Frank S. Rebeyka Vice Chairman Tel: 403-815-6637  Roger N. Dueck President & 
CEO Tel: 403-237-7820 x 223 info@exall.com   
Please visit Exall Energy's website at:www.exall.com 
Renmark Financial Communications Inc. Maurice 
Dagenais:mdagenais@renmarkfinancial.com Nadia 
Marks:nmarks@renmarkfinancial.com Tel.: (514) 939-3989 or (416) 644-2020 
www.renmarkfinancial.com 
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CO: EXALL ENERGY CORPORATION
ST: Alberta
NI: OIL ERN  
-0- Nov/14/2013 21:01 GMT
 
 
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