NORDIC OIL AND GAS ANNOUNCES Q1 2012 FINANCIAL RESULTS; REVENUE AT HIGHEST LEVEL IN TWO YEARS
WINNIPEG, MB. (May 30, 2012) – Nordic Oil and Gas Ltd. (TSXV: NOG), today announced the Company's financial results from operations for its first three months ended March 31, 2012. All amounts referenced herein are in Canadian dollars.
Revenue from oil and natural gas sales (including liquids and transport revenue) during the first quarter of 2012 totalled $317,365 up more than $65,500, or 26.5% from the $250,857 reported during the first quarter of 2011. This represents the highest quarterly revenue total the Company has reported in more than two years.
When adding interest, total revenue for the first quarter this year was $318,271 versus $251,835 for the same period a year ago.
The revenue increase for the year-to-date is due to the strong production from the Company’s natural gas well at Lloydminster, which averaged approximately 65 BOEs/day, and one of its heavy oil wells, also at Lloydminster. Although natural gas production at Joffre has been shut-in for a period of time at the Company’s wells at Joffre, production from the Coal Bed Methane wells has remained strong.
Total assets, including cash, short-term investments, accounts receivable, property and equipment and other assets (deposits), for the three months ended March 31, 2012 were $13,812,365 up slightly from $13,797,699 as at December 31, 2011, and up approximately $300,000 from the 2010-year end total of $13,538,405. The primary reason for the increase in total assets was a rise in intangible exploration and evaluation assets, which increased by approximately $300,000.
Overall expenses for the quarter ended March 31, 2012 totalled $345,744 significantly lower than the 2011 first quarter total of $855,522. The primary reason for the decrease in expenses was an impairment in excess of $450,000 on the changeover to IFRS Standards and continued improvement in General and Administration costs, which decreased by $72,739 in the first quarter when compared to the same period in 2011.
Production and operating expenses were up marginally from the $125,615 last year to $136,306 for the first quarter of 2012.
The net loss for the three months ended March 31, 2012 before income taxes was ($153,138), a substantial improvement over the net loss of ($685,553) reported during the first quarter of 2011. When applying deferred taxes to the first quarter of 2012, the net comprehensive loss improved to ($139,670); in Q1 2011, when applying deferred taxes the loss became even greater at ($949,412).
As of the end of the quarter under review, the Company had a 33 1/3% interest in 16 heavy oil wells. It also has a 100% interest in one natural gas well at Lloydminster; in addition, there are four Coal Bed Methane wells on production at Joffre.
Results from operations and the Company’s overall financial condition are significantly affected by natural gas commodity prices, which can fluctuate dramatically. These commodity prices are beyond the control of the Company and are difficult to predict.
During much of 2011, oil prices were slightly higher than they were 12 months prior, however natural gas prices continued to be at historically low levels throughout much of the year under review.
The volume of production from the Company’s natural gas and CBM wells at Joffre increased substantially during the first quarter of 2012 -398.33 GJ/day or 10.46 10³M³/day, when compared to both the fourth quarter of 2011 (235.57 GJ/day or 6.12 10³M³/day) and the first quarter of 2011 (305.88 GJ/day or 7.94 10³M³/day).This was due to the strong performance from the Company’s natural gas well at Lloydminster and the continued production from the Company’s four CBM wells at Joffre.
On the heavy oil side, volume was up in Q1 to 41.91 barrels per day, the highest daily average total for past eight quarters. The reason for the increase in Q1 was due to significant production from one of the Company’s heavy oil wells.
About Nordic Oil and Gas Ltd.
Nordic Oil and Gas Ltd. is a junior oil and gas company engaged in the exploration and development of oil, natural gas and Coal Bed Methane in Alberta and Saskatchewan. The Corporation is listed on the TSX Venture Exchange and trades under the symbol NOG. Nordic was one of the “2008 TSX Venture 50” companies, a ranking of the top 10 public venture capital companies in five industry sectors listed on the TSX Venture Exchange.
This news release contains certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that the Corporation expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Although the Corporation believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements include market prices, exploration and drilling success, continued availability of capital and financing and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward looking statements are based on the beliefs, estimates and opinions of the Corporation’s management on the date the statements are made. The Corporation undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change.
* The term BOEs may be misleading, particularly if used in isolation. A BOES conversion ratio of 6 Mcf: 1 barrel 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 the contents of this News Release.