Zargon Oil & Gas Ltd Announces August 2015 Dividend, Payable on September 15, 2015
Aug 17 15
Zargon Oil & Gas Ltd. announced the monthly cash dividend for the month of August in the amount of CAD 0.01 per common share will be paid on September 15, 2015 to shareholders of record on August 31, 2015.
Zargon Oil & Gas Ltd. Reports Unaudited Earnings and Production Results for the Second Quarter and Six Months Ended June 30, 2015; Provides Production Guidance for the Third Quarter and Second Half of 2015 and Capital Expenditure Guidance for 2015
Aug 13 15
Zargon Oil & Gas Ltd. reported unaudited earnings and production results for the second quarter and six months ended June 30, 2015. For the quarter, funds flow from operating activities was $9.99 million or $0.33 per share against 11.88 million or $0.39 per share a year ago. Gross petroleum and natural gas sales were $20.32 million against $40.86 million a year ago. Cash flows from operating activities were $6.98 million against $10.03 million a year ago. Net loss was $3.76 million or $0.12 per share against $2.02 million or $0.07 per share a year ago. Net capital expenditures were $5.35 million against $13.37 million a year ago. Funds flow from operating activities were increased due to a combination of higher oil prices, lower operating expenses and decreased general and administrative expenses, and 16% lower than the $11.9 million reported in the second quarter of 2014.
For the six months, the company reported gross petroleum and natural gas sales of $36.73 million against $81.12 million a year ago. Cash flows from operating activities were $13.65 million against $24.89 million a year ago. Net loss was $8.64 million or $0.29 per share against $1.85 million or $0.06 per share a year ago. Net capital expenditures were $10.75 million against $28.85 million a year ago. Funds flow from operating activities was $17.23 million or $0.57 per share against $27.18 million or $0.90 per share a year ago. Long term bank debt at June 30, 2015 was $50.80 million against $56.37 million at June 30, 2014.
For the quarter, the company reported oil and liquids production of 3,720 bbl/d, natural gas production of 5.32 mmcf/d and equivalent production of 4,607 boe/d compared to oil and liquids production of 4,096 bbl/d, natural gas production of 14.77 mmcf/d and equivalent production of 6,558 boe/d a year ago.
For the six months, the company reported oil and liquids production of 3,824 bbl/d, natural gas production of 5.28 mmcf/d and equivalent production of 4,704 boe/d compared to oil and liquids production of 4,208 bbl/d, natural gas production of 14.41 mmcf/d and equivalent production of 6,610 boe/d a year ago.
The company's 2015 total capital budget continues to be set at $25 million (before dispositions) of which approximately $14 million remains to be spent in the second half of the year. The remaining 2015 capital budget will be allocated $3 million to conventional expenditures, $7 million for ASP chemicals and $4 million for ASP remedial and optimization expenditures.
For 2016, the company is currently forecasting a $22 million capital budget which is comprised of $6 million of conventional expenditures, $14 million for ASP chemical costs and $2 million of ASP exploitation costs that will complete the alkaline and surfactant stage for the Little Bow phase 1 project. The follow-on polymer injection costs for phase 1 are expected to average $4 million per year during the 2017 through 2019 period. Phase 2 expansion capitals will be deferred until realized field oil prices increase from the current depressed levels.
For the second half of 2015, the company has hedged 1,417 barrels per day at $79.81 Cdn/bbl WTI, while for the first half of 2016 an average of 500 barrels per day is hedged at $79.30 Cdn/bbl WTI.
Combined oil and liquids production for the 2015 third quarter is forecast at 3,650 barrels of oil per day and the magnitude of the 2015 fourth quarter production gains will depend on the results of the upcoming $4 million Little Bow ASP remedial and optimization capital program. Third quarter natural gas production guidance is forecast at 5.0 million cubic feet per day.
Zargon Mulls Strategic Alternatives
Aug 13 15
Zargon Oil & Gas Ltd (TSX:ZAR) has initiated a process of searching strategic alternatives. Zargon's Board of Directors (the "Board") and management of the Company believe Zargon's share price has not been reflective of the fundamental value inherent in the Company and the Board has determined that it is timely to review the Company's alternatives in light of its long-life, low-decline conventional assets and the significant long term potential related to the Little Bow ASP project. Consequently, the Board has initiated a process to identify and consider strategic and financial alternatives available to the Company with the ultimate goal of maximizing shareholder value. The Company has established a Special Committee that will be comprised of independent directors to oversee the strategic review process. Strategic and financial alternatives may include, but are not limited to a strategic financing, merger or other business combination, sale of the Company or a portion of the Company's business or assets or any combination thereof, as well as the continued execution of its business plan. Scotia Waterous Inc. acted as financial advisor for the Special Committee.