Click here to close now.




















Welcome!

Microsoft Cloud Authors: Elizabeth White, Adine Deford, the Editor, Michael Krems, Xenia von Wedel

News Feed Item

Rock Energy Reports Financial and Operating Results for Third Quarter of 2012

CALGARY, ALBERTA -- (Marketwire) -- 11/08/12 -- Rock Energy Inc. (TSX:RE) ("Rock" or the "Company") announces its financial and operational results for the three and nine months ended September 30, 2012. Rock has filed its unaudited condensed interim Consolidated Financial Statements for the period ended September 30, 2012 and related Management's Discussion and Analysis ("MD&A"). Copies of Rock's materials may be obtained on www.sedar.com and on its website at www.rockenergy.ca

Certain selected financial and operations information for the three and nine months ended September 30, 2012 and the 2011 comparatives are set out below and should be read in conjunction with Rock's unaudited condensed interim Consolidated Financial Statements and MD&A.

CORPORATE SUMMARY


----------------------------------------------------------------------------
----------------------------------------------------------------------------
                       Three Months  Three Months  Nine Months  Nine Months 
                              Ended         Ended        Ended        Ended 
                          September     September    September    September 
                           30, 2012      30, 2011     30, 2012     30, 2011 
----------------------------------------------------------------------------
                                                                            
Crude oil and natural                                                       
 gas revenue ($000)     $    10,988   $    13,928  $    33,765  $    47,189 
                                                                            
Funds from operations                                                       
 ($000) (1)             $     3,711   $     3,993  $    10,432  $    12,461 
 Per share - basic      $      0.09   $      0.10  $      0.27  $      0.35 
           - diluted    $      0.09   $      0.10  $      0.27  $      0.34 
                                                                            
Net income (loss)                                                           
 ($000)                 $    (2,186)  $       459  $    (5,862) $    (1,927)
 Per share - basic      $     (0.06)  $      0.01  $     (0.15) $     (0.05)
           - diluted    $     (0.06)  $      0.01  $     (0.15) $     (0.05)
                                                                            
Capital expenditures                                                        
 ($000)                 $     7,395   $    15,057  $    22,701  $    56,144 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                              As at         As at                           
                          September     September                           
                           30, 2012      30, 2011                           
----------------------------------------------------------------------------
                                                                            
Working capital                                                             
 (deficiency) including                                                     
 bank debt and                                                              
 excluding commodity                                                        
 price contracts ($000) $     2,614   $   (31,939)                          
                                                                            
Common shares                                                               
 outstanding             39,101,582    38,786,315                           
Options outstanding       2,905,435     2,551,094                           
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                              Three         Three  Nine Months  Nine Months 
                       Months Ended  Months Ended        Ended        Ended 
                          September     September    September    September 
OPERATIONS                 30, 2012      30, 2011     30, 2012     30, 2011 
----------------------------------------------------------------------------
                                                                            
Average daily                                                               
 production                                                                 
 Crude oil and natural                                                      
  gas liquids (bbls/d)        1,720         2,094        1,716        2,331 
 Natural gas (mcf/d)          3,131         4,608        3,360        4,998 
 Total (boe/d)                2,242         2,862        2,276        3,164 
                                                                            
Average product prices                                                      
 Crude oil and natural                                                      
  gas liquids                                                               
  (Cdn$/bbl)            $     64.94   $     63.68  $     67.37  $     65.59 
 Natural gas (Cdn                                                           
  $/mcf)                $      2.47   $      3.92  $      2.28  $      4.00 
 Combined (Cdn$/boe)    $     53.27   $     52.90  $     54.15  $     54.63 
                                                                            
Field netback                                                               
 (Cdn$/boe) (1)         $     18.43   $     20.71  $     18.83  $     20.68 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Funds from operations, funds from operations per share and field netback
    are not terms prescribed by IFRS so are considered non-GAAP measures.   
    Funds from operations represents cash generated from operating          
    activities before changes in non-cash working capital and               
    decommissioning expenditures. Rock considers funds from operations a key
    measure as it demonstrates the Company's ability to generate the cash   
    necessary to fund future growth through capital investment. Funds from  
    operations per share is calculated using the same share basis which is  
    used in the determination of net income (loss) per share. Field netback 
    is calculated as crude oil and natural gas revenues after deducting     
    royalties, op erating costs and transportation costs, resulting in an   
    approximation of initial cash margin in the field on crude oil and      
    natural gas production. Rock's use of these non-GAAP measurements may   
    not be comparable with the calculation of similar measures for other    
    companies.                                                              

During the third quarter of 2012 Rock completed the following:


--  Drilled 10 (10.0 net) wells, nine (9.0 net) successful oil wells and one
    (1.0 net) dry and abandoned well at Mantario; 
--  Averaged 2,242 boe per day (77% crude oil and liquids and 23% natural
    gas) of production; 
--  Spent a total of $7.4 million on capital expenditures; and 
--  Generated funds from operations for the quarter of $3.7 million ($0.09
    per share). 

Rock generated a field netback of $18.43 per boe in the third quarter of 2012 compared to $19.11 per boe in the second quarter of 2012. Rock's realized price in the third quarter of 2012 was $53.27 per boe compared to $53.34 per boe in the second quarter of 2012. The WTI-WCS price differential during the third quarter was US $21.72 per barrel. Though the differential narrowed to less than US $10.00 per barrel in October, it has recently widened to US $25.00 - US $30.00 per barrel as the BP Whiting refinery shuts down for a planned upgrade. This modification to the refinery will take 3 to 4 months and we expect the differential to be adversely impacted during that time. However, once the project is complete, the refinery will have expanded its capacity to refine heavy oil and we are projecting a sustained narrowing of the differential beyond the first quarter of next year in to the range of US $15.00 - US $20.00 per barrel. To manage the volatility in this price, Rock is actively engaged in a hedging program and is shipping up to 1,000 barrels per day by rail.

Operating costs increased to $25.69 per boe in the third quarter of 2012 compared to $22.34 per boe in the previous quarter. This increase in costs can be attributed to unscheduled battery maintenance that affected both our Onward and Medicine River facilities. In addition to the extra cost, the company experienced a reduction in production during the maintenance operations, so the impact was felt on both absolute and per boe measures. Going forward Rock expects to reduce our operating costs as more low cost production is brought on at Mantario and the installation of water handling and disposal facilities are completed in the Lloydminster and Neilburg areas.

Capital expenditures for the third quarter of 2012 were $7.4 million including the drilling and equipping of the nine wells at Mantario, one well at Edam, and the installation of water disposal facilities in Lloydminster and Neilburg.

During the third quarter of 2012 Rock's daily production averaged 2,242 boe per day, and currently the Company is producing over 2,600 boe per day.

Area Activity Update

Mantario

During the third quarter of 2012 Rock drilled nine (9.0 net) wells at Mantario. One exploration well was dry and abandoned, one well failed to encounter the primary target but was successful in a secondary zone, and seven wells were cased as oil producers in the primary zone. The seven wells have been completed and put on production during October. These wells are currently producing over 450 barrels per day and when combined with the original wells, Mantario is contributing over 800 barrels per day to Rock's total production. The eighth well which will be producing from a different formation will be on production by late November. The information provided by the drilling of the most recent wells has allowed the Company to refine the pool mapping and management has estimated that there is an additional 40-60 drilling locations on this new discovery.

In addition to the drilling activity, Rock evaluated and subsequently released the lands previously held under a farm-out agreement. The Company acquired another 7.75 sections of land at crown land sales which brings Rock's total land position at Mantario to 15,200 net acres (23.75 sections).

During the fourth quarter of 2012, the Company plans to shoot an additional 30 square kilometers of 3D seismic and drill another exploration well.

Onward

The water-flood project at Onward was focused on optimizing injection patterns, and upgrading the fluid handling capacity at the battery during the third quarter. The Company is currently installing new inlet and treating equipment and we expect the work to be completed by the middle of November. Once completed, the fluid capacity of the battery will have been expanded by 50%, allowing us to increase the pumping rates on our producing wells and further optimize our production.

Greater Lloydminster Area

Rock drilled one successful step out exploration well at Edam during the third quarter of 2012. The well is currently producing 50 to 70 barrels per day and with this success we have now identified 6 to 8 follow up locations. Rock has completed the installation of water injection facilities at Lloydminster and Neilburg and in addition to reduced operating costs we expect to begin the implementation of high volume lift ("HVL") programs at these two sites. HVL is a production technique to increase production rates and recovery factors in conventional heavy oil wells that has been successfully deployed by a number of heavy oil operators in the Lloydminster area.

Outlook

For the remainder of 2012 Rock is maintaining its previously announced guidance for production. However, the capital budget will increase slightly to $32 million as we initiate activities for 2013. For the remainder of the year, the Company will be focused on completing the 3D seismic survey at Mantario and drilling four exploration wells in our core areas. Assuming that for the remainder of 2012 crude oil prices average US $90.00 WTI per barrel and natural gas at AECO averages of CDN $3.25 per mcf with an exchange rate of 1.00 CDN$:US$ the Company would generate cash flow of $15 million (or $0.39 per share) and have $2 million of net debt by year-end 2012.

The Board of directors have approved a preliminary capital budget for 2013 of $30 million to drill 22 wells. The capital budget will be focused on the continued delineation of the pool at Mantario by drilling 11 more 40 acre step out locations and two horizontal wells. In addition, the Company plans to drill five wells in the greater Lloydminster region and complete the two HVL projects. At Onward, the capital will be limited to further water injection conversions and additional facility upgrades as most of the pool development capital was spent in 2012.

This capital budget is expected to increase the Company's average production for the year by over 25 percent to 2,900 boe per day, and our oil weighting to 85 percent.

Assuming that for 2013 crude oil prices average US $90.00 WTI per barrel, the WTI-WCS differential averages US $20.00 per barrel and natural gas at AECO averages CDN $3.00 per mcf with an exchange rate of 1.00 CDN$:US$ the Company would generate cash flow of $22 million (or $0.56 per share) and have $11 million of net debt by the end of 2013 (0.4 times fourth quarter annualized cash flow).

Rock has established a strong platform for growth. That platform is made up of a significant inventory of over 130 drilling locations, an active exploration program and a strong balance sheet. Rock's foundation of funds flow, cash and significant debt capacity allow the Company to pursue complementary acquisitions or mergers as well as considering additional expansions to the planned 2013 capital program as new exploration and development opportunities are identified.

Advisory Regarding Forward-Looking Information and Statements

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "will", "expects", "believe", "plans", "potential" and similar expressions are intended to identify forward-looking statements or information. More particularly and without limitation, this press release contains forward looking statements and information concerning Rock's 2012 and 2013 average production, expected costs, capital spending plans and timing thereof, forecasted cash flow, growth prospects and the Company's drilling plans.

The forward-looking statements and information in this press release are based on certain key expectations and assumptions made by Rock, including prevailing commodity prices and exchange rates; applicable royalty rates and tax laws; future well production rates; reserve and resource volumes; the performance of existing wells; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; and the receipt, in a timely manner, of regulatory and other required approvals. Although Rock believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Rock can give no assurance that they will prove to be correct. There is no certainty that Rock will achieve commercially viable production from its undeveloped lands and prospects.

Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to the risks associated with the oil and gas industry in general such as: operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; marketing and transportation of petroleum and natural gas and loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of acquisitions; ability to access sufficient capital from internal and external sources; stock market volatility; and changes in legislation, including but not limited to tax laws, royalty rates and environmental regulations.

Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the operations or financial results of Rock are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).

The forward-looking statements and information contained in this press release are made as of the date hereof and Rock undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Contacts:
Rock Energy Inc.
Allen J. Bey
Chief Executive Officer
403-218-4380

Rock Energy Inc.
John H. Van de Pol
President and Chief Financial Officer
403-218-4380
www.rockenergy.ca

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo, November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be.
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts, GM of Platform at FinancialForce.com, will discuss the value of business applications on wearable ...
SYS-CON Events announced today that Micron Technology, Inc., a global leader in advanced semiconductor systems, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Micron’s broad portfolio of high-performance memory technologies – including DRAM, NAND and NOR Flash – is the basis for solid state drives, modules, multichip packages and other system solutions. Backed by more than 35 years of technology leadership, Micron's memory solutions enable the world's most innovative computing, consumer,...
17th Cloud Expo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterprises are using some form of XaaS – software, platform, and infrastructure as a service.
Containers are not new, but renewed commitments to performance, flexibility, and agility have propelled them to the top of the agenda today. By working without the need for virtualization and its overhead, containers are seen as the perfect way to deploy apps and services across multiple clouds. Containers can handle anything from file types to operating systems and services, including microservices. What are microservices? Unlike what the name implies, microservices are not necessarily small, but are focused on specific tasks. The ability for developers to deploy multiple containers – thous...
As more intelligent IoT applications shift into gear, they’re merging into the ever-increasing traffic flow of the Internet. It won’t be long before we experience bottlenecks, as IoT traffic peaks during rush hours. Organizations that are unprepared will find themselves by the side of the road unable to cross back into the fast lane. As billions of new devices begin to communicate and exchange data – will your infrastructure be scalable enough to handle this new interconnected world?
While many app developers are comfortable building apps for the smartphone, there is a whole new world out there. In his session at @ThingsExpo, Narayan Sainaney, Co-founder and CTO of Mojio, will discuss how the business case for connected car apps is growing and, with open platform companies having already done the heavy lifting, there really is no barrier to entry.
SYS-CON Events announced today that the "Second Containers & Microservices Expo" will take place November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities.
Consumer IoT applications provide data about the user that just doesn’t exist in traditional PC or mobile web applications. This rich data, or “context,” enables the highly personalized consumer experiences that characterize many consumer IoT apps. This same data is also providing brands with unprecedented insight into how their connected products are being used, while, at the same time, powering highly targeted engagement and marketing opportunities. In his session at @ThingsExpo, Nathan Treloar, President and COO of Bebaio, will explore examples of brands transforming their businesses by t...
WebRTC services have already permeated corporate communications in the form of videoconferencing solutions. However, WebRTC has the potential of going beyond and catalyzing a new class of services providing more than calls with capabilities such as mass-scale real-time media broadcasting, enriched and augmented video, person-to-machine and machine-to-machine communications. In his session at @ThingsExpo, Luis Lopez, CEO of Kurento, will introduce the technologies required for implementing these ideas and some early experiments performed in the Kurento open source software community in areas ...
Akana has announced the availability of the new Akana Healthcare Solution. The API-driven solution helps healthcare organizations accelerate their transition to being secure, digitally interoperable businesses. It leverages the Health Level Seven International Fast Healthcare Interoperability Resources (HL7 FHIR) standard to enable broader business use of medical data. Akana developed the Healthcare Solution in response to healthcare businesses that want to increase electronic, multi-device access to health records while reducing operating costs and complying with government regulations.
The Internet of Things is in the early stages of mainstream deployment but it promises to unlock value and rapidly transform how organizations manage, operationalize, and monetize their assets. IoT is a complex structure of hardware, sensors, applications, analytics and devices that need to be able to communicate geographically and across all functions. Once the data is collected from numerous endpoints, the challenge then becomes converting it into actionable insight.
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo in Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal an...
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.
The 3rd International WebRTC Summit, to be held Nov. 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA, announces that its Call for Papers is now open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 15th International Cloud Expo, 6th International Big Data Expo, 3rd International DevOps Summit and 2nd Internet of @ThingsExpo. WebRTC (Web-based Real-Time Communication) is an open source project supported by Google, Mozilla and Opera that aims to enable bro...
Through WebRTC, audio and video communications are being embedded more easily than ever into applications, helping carriers, enterprises and independent software vendors deliver greater functionality to their end users. With today’s business world increasingly focused on outcomes, users’ growing calls for ease of use, and businesses craving smarter, tighter integration, what’s the next step in delivering a richer, more immersive experience? That richer, more fully integrated experience comes about through a Communications Platform as a Service which allows for messaging, screen sharing, video...
The 17th International Cloud Expo has announced that its Call for Papers is open. 17th International Cloud Expo, to be held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, APM, APIs, Microservices, Security, Big Data, Internet of Things, DevOps and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal today!
In his session at @ThingsExpo, Lee Williams, a producer of the first smartphones and tablets, will talk about how he is now applying his experience in mobile technology to the design and development of the next generation of Environmental and Sustainability Services at ETwater. He will explain how M2M controllers work through wirelessly connected remote controls; and specifically delve into a retrofit option that reverse-engineers control codes of existing conventional controller systems so they don't have to be replaced and are instantly converted to become smart, connected devices.
SYS-CON Events announced today that IceWarp will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IceWarp, the leader of cloud and on-premise messaging, delivers secured email, chat, documents, conferencing and collaboration to today's mobile workforce, all in one unified interface
SYS-CON Events announced today the Containers & Microservices Bootcamp, being held November 3-4, 2015, in conjunction with 17th Cloud Expo, @ThingsExpo, and @DevOpsSummit at the Santa Clara Convention Center in Santa Clara, CA. This is your chance to get started with the latest technology in the industry. Combined with real-world scenarios and use cases, the Containers and Microservices Bootcamp, led by Janakiram MSV, a Microsoft Regional Director, will include presentations as well as hands-on demos and comprehensive walkthroughs.