CDN NEWS | 
US NEWS 
CALGARY, April 12, 2018 /CNW/ – Marquee Energy Ltd. (“Marquee” or the “Company”) (TSXV: “MQX”) is pleased to report it’s financial and operating results for the year ended December 31, 2017 and provide an operational update for the first quarter of 2018. Marquee’s audited annual Financial Statements as well as the corresponding Management’s Discussion and Analysis for 2017 are available on its website www.marquee-energy.com as well as on SEDAR at www.sedar.com.
Q4 2017 HIGHLIGHTS
- Production in Q4 averaged 2,874 boe per day, comprising 49% oil and liquids; a 12% increase to total boe per day production over Q4 2016.
- Operating netbacks averaged $15.55 per boe in Q4, reflecting an increase of 126% over Q4 2016 due mainly to increased production and product pricing.
FINANCIAL AND OPERATIONAL HIGHLIGHTS
|
(thousands of Canadian dollars, except share, per share and, per boe amounts) |
Three months ended |
Year ended December 31, |
|||||||
|
2017 |
2016 |
2017 |
2016 |
||||||
|
Financial |
|||||||||
|
Oil and natural gas sales (1) |
$ |
9,068 |
$ |
8,013 |
$ |
32,048 |
$ |
31,538 |
|
|
Funds flow from (used in) operations (2) |
$ |
972 |
$ |
404 |
$ |
5,954 |
$ |
(3,065) |
|
|
Per share – basic and diluted |
$ |
0.00 |
$ |
0.00 |
$ |
0.01 |
$ |
0.01 |
|
|
Per boe |
$ |
2.67 |
$ |
(16.51) |
$ |
5.84 |
$ |
2.50 |
|
|
Cash flow from (used in) operating activities |
$ |
661 |
$ |
(1,741) |
$ |
1,656 |
$ |
762 |
|
|
Net income (loss) |
$ |
(13,040) |
$ |
(10,063) |
$ |
(21,595) |
$ |
(22,185) |
|
|
Per share – basic and diluted |
$ |
(0.03) |
$ |
(0.04) |
$ |
(0.05) |
$ |
(0.10) |
|
|
Capital expenditures (net of dispositions) |
$ |
3,392 |
$ |
1,052 |
$ |
18,767 |
$ |
(3,386) |
|
|
Net debt (2)(3) |
$ |
31,598 |
$ |
17,165 |
$ |
31,598 |
$ |
17,165 |
|
|
Total assets |
$ |
163,969 |
$ |
169,162 |
$ |
163,969 |
$ |
169,162 |
|
|
Weighted average basic shares outstanding |
435,772,196 |
266,381,644 |
435,772,196 |
220,943,307 |
|||||
|
Weighted average diluted shares outstanding |
435,772,196 |
266,381,644 |
435,772,196 |
220,943,307 |
|||||
|
Operational |
|||||||||
|
Daily sales volumes |
|||||||||
|
Oil (bbls per day) |
1,265 |
1,047 |
1,128 |
1,254 |
|||||
|
Heavy Oil (bbls per day) |
– |
– |
– |
162 |
|||||
|
NGLs (bbls per day) |
155 |
172 |
150 |
142 |
|||||
|
Natural Gas (Mcf per day) |
8,722 |
8,034 |
9,091 |
10,824 |
|||||
|
Total (boe per day) |
2,874 |
2,558 |
2,793 |
3,361 |
|||||
|
% Oil and NGLs |
49% |
48% |
46% |
46% |
|||||
|
Average realized prices |
|||||||||
|
Light Oil ($/bbl) |
$ |
59.36 |
$ |
51.38 |
$ |
53.26 |
$ |
42.78 |
|
|
Heavy Oil ($/bbl) |
$ |
– |
$ |
– |
$ |
– |
$ |
23.61 |
|
|
NGL’s ($/bbl) |
$ |
45.94 |
$ |
30.52 |
$ |
41.10 |
$ |
32.37 |
|
|
Natural Gas ($/Mcf) |
$ |
1.88 |
$ |
3.49 |
$ |
2.37 |
$ |
2.23 |
|
|
Netback (2) |
|||||||||
|
Revenue ($/boe) |
$ |
34.30 |
$ |
34.05 |
$ |
31.43 |
$ |
25.64 |
|
|
Royalties ($/boe) |
$ |
(1.95) |
$ |
(1.64) |
$ |
(1.91) |
$ |
(1.99) |
|
|
Operating and transportation costs ($/boe) |
$ |
(16.72) |
$ |
(24.29) |
$ |
(16.52) |
$ |
(17.54) |
|
|
Operating netback prior to hedging (2) |
$ |
15.63 |
$ |
8.12 |
$ |
13.00 |
$ |
6.11 |
|
|
Realized hedging gain (loss) ($/boe) |
$ |
(0.08) |
$ |
(1.25) |
$ |
1.27 |
$ |
1.41 |
|
|
Operating netback ($/boe) (2) |
$ |
15.55 |
$ |
6.87 |
$ |
14.27 |
$ |
7.52 |
|
|
(1) |
Before royalties. |
|
(2) |
Non-IFRS Measure. See Non-IFRS Measures advisory in Marquee’s MD&A for the year ended December 31, 2017. |
|
(3) |
Consisting of the term loan, less cash plus working capital deficiency. Bank credit facility was undrawn at December 31, 2017. |
OPERATIONAL UPDATE
Marquee completed field operations and brought all five wells of the previously announced Q1 2018 capital program at Michichi, Alberta on production. Each of these wells was drilled with cemented monobores and received 28 to 29 fracture stages.
The first well from this program was brought on production in mid-January and has an average field estimated production rate over the first 60 days (IP60) of 195 boe per day (80% oil and liquids). The well has been producing at pump capacity with a high fluid level (approximately 600 m above the pump) and production has been stable for the last 40 days. Although preliminary in nature, Management is encouraged by the production results from this well thus far and views the increased fracture density as a potentially significant value add to the Company’s Michichi Banff play going forward.
The final four wells in the program were drilled from a common surface location and commenced production in late March. The wells continue to clean up load water from the fracture stimulation. The Company will release production results when meaningful information becomes available.
The per well capital cost for each of these new wells was $2.3 million, which is 25% above the previously announced budgeted capital. The increase to the total number of fracture stages, as well as an adverse impact due to cold weather and service delays, contributed to the higher than forecasted capital requirement. The Company believes an accurate go-forward capital estimate, incorporating both summer and winter activity, will average approximately $2 million per well.
Management continues to prudently manage the balance sheet and will evaluate commodity prices in the coming months to determine a sustainable second half 2018 drilling program.
As previously announced, Marquee commenced a review of strategic alternatives to enhance shareholder value. Given the nature of the process, the Company does not intend to provide updates with respect to the process until such time as the Board of Directors approves a definitive transaction or strategic alternatives, or otherwise determines that further disclosure is advisable. The Company cautions that there are no guarantees that the review of strategic alternatives will result in a transaction or if a transaction is undertaken, as to its terms or timing.
ABOUT MARQUEE
Marquee is a Calgary-based, junior energy company focused on light oil development and production in the Michichi area of eastern Alberta. Marquee’s shares trade on the TSX Venture Exchange under the trading symbol “MQX”. Additional information about Marquee may be found on its website www.marquee-energy.comand in its continuous disclosure documents filed with Canadian securities regulators on SEDAR at www.sedar.com.
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