Microsoft Cloud Authors: Lori MacVittie, Elizabeth White, Yeshim Deniz, Serafima Al, Janakiram MSV

News Feed Item

C&C Energia Reports Third Quarter Operating and Financial Results

CALGARY, ALBERTA -- (Marketwire) -- 11/09/12 -- C&C Energia Ltd. ("C&C Energia" or the "Corporation") (TSX:CZE) is pleased to report its operating and financial results for the three and nine months ended September 30, 2012.

C&C Energia continues to deliver year-on-year production growth as a result of its successful drilling program, positive response from its Gacheta water injection program at Carrizales and well optimizations. Average daily production for the third quarter 2012 was 11,424 barrels of oil per day ("bopd"), which is 19% higher than the same period in 2011, and year-to-date production grew 39% to 10,776 bopd. The Corporation expects to average approximately 10,800 bopd for full-year 2012 with an exit rate of approximately 11,500 bopd.

Funds flow (after tax) from operations for the three months ended September 30, 2012 was $1.00 per share or $64.1 million, an increase of 71% from the prior year period reflecting higher sales, increased production and cost reduction initiatives. During the third quarter 2012, C&C Energia realized an average price of $101.71 per barrel on its sales, generating operating netbacks of $59.12 per barrel. Operating costs and transportation costs (excluding one-time standby fees incurred during the first half of 2012) were down approximately 3% and 7% respectively from second quarter 2012 as the effects of cost cutting initiatives began to be realized.

The Corporation has a strong balance sheet with an adjusted working capital surplus of $73.3 million (including $61.5 million in cash) and no debt. Crude inventory levels decreased almost 50% from the second quarter to just over 200,000 barrels at September 30, 2012, resulting in a significant increase in accounts receivable to $68 million. C&C Energia collected $38.0 million of these receivables in October.

C&C Energia will be filing its interim financial statements and management's discussion and analysis as at and for the three and nine months ended September 30, 2012, which will contain detailed information regarding the Corporation's results. When filed, these documents will be available for review under C&C Energia's profile on the SEDAR website at www.sedar.com.


(All references to $ are to United States dollars unless otherwise noted.)

                                 Three Months Ended       Nine Months Ended 
                                      September 30,           September 30, 
(unaudited)                        2012        2011        2012        2011 
Operating                   (thousands of US$, except share, per share, per 
                                                      bbl and bopd amounts) 
Operating cash flow (1)          76,956      47,646     181,330     119,766 
Average crude oil volumes                                                   
 (before royalties)                                                         
  Production (bopd)              11,424       9,572      10,776       7,768 
  Sales (bopd)                   14,445       8,430      11,386       7,372 
Average reference price                                                     
  WTI ($ per bbl)                 92.10       89.48       96.14       95.28 
Operating netback ($ per                                                    
 bbl) (4)                                                                   
  Average realized price (5)     101.71      104.14      106.04      104.85 
  Royalties                      (11.29)     (10.03)     (12.22)     (12.49)
  Production expenses            (14.69)     (15.95)     (15.88)     (16.86)
  Transportation expenses        (16.61)     (14.51)     (17.71)     (13.71)
Operating netback (4)             59.12       63.65       60.23       61.79 
Oil revenues (net of                                                        
 royalties)                     120,164      72,988     292,697     185,881 
                                 64,125      37,601     134,912      87,698 
Funds flow from operations                                                  
  Per share - basic ($)            1.00        0.59        2.11        1.48 
  Per share - diluted ($)          1.00        0.59        2.11        1.45 
                                 31,711      20,811      71,982      43,080 
Net income                                                                  
  Per share - basic ($)            0.50        0.33        1.13        0.73 
  Per share - diluted ($)          0.50        0.32        1.13        0.71 
                                 26,741      30,943     128,740     109,682 
Capital expenditures                                                        
Total assets                    588,413     492,149     588,413     492,149 
Debt                                  -           -           -           - 
Adjusted working capital                                                    
 surplus (3)                     73,339      69,697      73,339      69,697 
Common shares outstanding                                                   
  Basic                      63,842,503  63,842,503  63,842,503  63,842,503 
  Fully diluted              69,225,005  69,360,005  69,225,005  69,360,005 
Weighted average common                                                     
 shares outstanding                                                         
  Basic                      63,842,503  63,842,503  63,842,503  63,842,503 
  Diluted                    63,874,622  64,068,369  63,961,124  60,612,028 

Notes See "GAAP, Additional GAAP and Non-GAAP Measures", below,

(1) Operating cash flow is oil revenues less royalties, operating expenses, transportation expenses and administration expenses. Operating cash flow is a non-GAAP measure (as defined herein) because it is not presented in the 2011 annual consolidated financial statements.

(2) Funds flow from operations is cash flow from operating activities before changes in other non-cash working capital items. Funds flow from operations is an additional GAAP measure because it is presented in Note 12 to the Corporation's 2011 annual consolidated financial statements.

(3) Adjusted working capital surplus includes current assets less current liabilities excluding risk management contracts (unrealized gains (losses) on commodity swaps) and deferred taxes. Adjusted working capital surplus is a non-GAAP measure because it is not presented in the 2011 annual consolidated financial statements.

(4) Operating netback is determined by dividing oil sales revenues less royalties, production expenses and transportation expenses by sales volumes. Netbacks are calculated by subtracting royalties, production expenses, transportation expenses, administrative expenses, interest and taxes paid by the Corporation from crude oil revenue and dividing by sales volumes. Operating netback is a non-GAAP measure because it is not presented in the 2011 annual consolidated financial statements.

(5) Excludes impact of risk management contracts (unrealized gains (losses) on commodity swaps).


--  Increased average third quarter 2012 production to over 11,400 bopd, an
    increase of 19% from the same quarter of 2011 and 9% over the second
    quarter of 2012. Production for the first nine months of 2012 averaged
    10,776 bopd which was 39% higher than for the nine months ended
    September 30, 2011. The Corporation expects to average approximately
    10,800 bopd for full-year 2012.  
--  Funds flow (after tax) ("Funds flow") from operations for the third
    quarter was $1.00 per share or $64.1 million, an increase of 71% above
    the third quarter of 2011. Funds flow increased $35.0 million from the
    second quarter of 2012 as a result of sales of crude oil inventory that
    was build up in the second quarter. Funds flow for the nine month period
    ended September 30, 2012 was $134.9 million ($2.11 per share) up over
    50% from the $87.7 million for the same period in 2011. 
--  Net income for the third quarter of 2012 was $31.7 million compared to
    net income of $20.8 million in the third quarter of 2011, reflecting the
    increase in production and sales volumes. Net income for the nine month
    period ended September 30, 2012 was $72.0 million, which represents an
    increase of over 65% that of the same period in 2011. 
--  Operating netbacks for the three months ended September 30, 2012 were
    $59.12 per barrel based on an average realized price of $101.71 per
--  As previously announced on October 11, 2012, during the third quarter
    2012, the Corporation completed drilling four exploration wells
    (Heredia-2, Guacharrios-1, Monarca-1 and Maquito-1), resulting in two
    oil wells and two dry holes (respectively). 
--  As announced on October 19, 2012, the Corporation was notified it was
    the lead bidder on a heavy oil block, LLA-83, during the Colombian Bid
    Round in October 2012. The Corporation anticipates receiving final
    confirmation in mid-November 2012.


C&C Energia's lands are located in Colombia in the Llanos Basin (four blocks), Putumayo Basin (three blocks), and Middle Magdalena Valley (one block).

During the third quarter of 2012, the Corporation invested $26.7 million primarily in the following areas: drilling and completion $14.1 million, workovers $2.4 million, civil works $1.3 million, facilities and roads $3.3 million, seismic $2.9 million and general property and capitalized G&A of $2.7 million.

Llanos Basin

On the Cravoviejo block, the Corporation drilled a successful exploration well in the Heredia field, a follow-on exploration well to the 2011 Heredia-1 discovery. The well was completed in the C5 and Gacheta Formations. The Gacheta Formation tested under natural flow at 415 bopd of 27 degrees of API oil at a 2% water cut over a four day testing interval. The C5 Formation tested under natural flow at approximately 385 bopd of 31 degrees API oil at a 35% water cut. The well will be brought on permanent production from the Gacheta Formation in late November. "We are excited by the results of the Heredia-2 well," said Randy McLeod, President and CEO. "The indications are that we have a stratigraphic play concept in the Gacheta sands on the Cravoviejo block, which could provide future potential. We anticipate spudding Heredia-3 prior to year-end to further test the concept."

Subsequent to quarter end, the Saimiri-2 exploration well was completed in the C5 Formation and tested on natural flow at approximately 540 bopd of 33 degrees API oil at a less than 1% water cut. An application is being made to bring the well on permanent production, which is expected in late November or early December 2012.

On the Cachicamo block, C&C Energia drilled three exploration wells and completed the extended testing of the Greta Oto-1 discovery well during the third quarter. The Greta Oto-1 well was perforated and had sustained production rates of approximately 500 bopd of 26 degrees API oil and has been placed on permanent production. The Guacharios-1 exploration well tested approximately 430 bopd of 28 degrees API oil from the Gacheta Formation with a 5% water cut and has been placed on permanent production. As C&C Energia announced on August 13, 2012, the Monarca-1 and Maquito-1 exploration wells, which were testing prospects in the outer edges of the Cachicamo block, were plugged and abandoned. Drill and abandonment costs were approximately US$1.5 million for each of these wells.

C&C Energia has completed an extended volumetric pressure test of the Mirador Formation on the Tormento-1 well discovery in the Llanos 19 block. An extended production test of the Gacheta Formation is expected to be completed in early 2013. Results of the two tests will be combined to assess the potential of the discovery and to determine the locations of future appraisal drilling activity. The Corporation plans to drill an appraisal well, Tormento-2, in the first quarter of 2013.

The Corporation had the leading bid for the right to explore for oil and natural gas on LLA-83 block, an approximately 35,755 acre heavy oil block in the Llanos Basin in central Colombia, approximately 50 kilometers from the Rubiales heavy oil field. The bid for the block was submitted by C&C Energia as the operator for a 100% participating interest and is subject to final approval by, and execution of an exploration and production contract (an "E&P Contract") with, the National Agency of Hydrocarbons (the "ANH") in Colombia. The Corporation bid a 25% "x-factor", which equates to an incremental royalty on production from the block together with a total work commitment of US$14.0 million for seismic and drilling.

Management of C&C Energia anticipates receiving final confirmation as to the winning bidder for the LLA-83 block in mid-November 2012. If C&C Energia is confirmed as the winning bidder, management expects that negotiation of definitive agreements and execution of the E&P Contract with the ANH will be finalized by the end of 2012.

Putumayo Basin

Civil works continue on the Coati block without interruption. The Corporation, together with its partner Canacol Energy Ltd., anticipates the civil works will be completed in early 2013 and has planned for a well to spud in late first quarter 2013. Results are anticipated in the second quarter of 2013.

The Corporation and its partner VETRA Exploration and Production Colombia S.A. have completed acquisition of a 95 km2 3D seismic survey on the Putumayo-8 block (50% working interest). The data has been provided to a third party for processing, which is expected to be completed later in the fourth quarter 2012. An exploratory well is planned on this block for late in 2013, pending seismic processing results and receipt of drilling permits. The Putumayo-8 block is immediately adjacent to the Platanillo field, with a recently announced significant oil discovery in the Villeta Formation. C&C Energia is targeting the same pay horizons on an analogous play concept on its block less than three kilometers from the Platanillo discovery.



The Corporation had approved a capital investment budget for 2012 of between $150.0 and $165.0 million. The Corporation expects to invest the funds as follows: seismic, approximately $4.0 million to $6.0 million; drilling, completions and testing approximately $102.0 million to $107.0 million; field development and work-overs approximately $17.0 million; facilities and equipment approximately $22.0 million to $30.0 million; and $5.0 million for various other projects.

Average daily production for 2012 is forecast at approximately 10,800 bopd, a 28% increase over the 2011 annual average daily production. The Corporation plans to drill five wells (including one injection well), in the fourth quarter of 2012, which will result in a total of 18 to 19 wells in 2012.


The Corporation is pleased to announce its planned operating and capital budget for 2013. C&C Energia plans to drill between 20 and 22 wells in 2013 and will invest funds of between $160.0 and $175.0 million. Investments will be made on the following operations: seismic $2.0 to $4.0 million; drilling completions and testing $96.0 to $99.0 million; workovers, field development and health and safety costs $26.0 to $28.0 million; equipping, pipelines and facilities costs $32.0 to $35.0 million; and $9.0 million for various other projects. Production for 2013 is expected to average between 11,800 and 12,100 bbls/day, a 9% to 12% increase over the 2012 estimated annual average daily production. This will generate an estimated after tax funds flow from operations of approximately $175.0 million assuming an $89.00 realized price at a Brent price of US$100.00.


The Corporation is engaged in the exploration for and the development and production of oil resources in Colombia. Its strategy is to develop producing oil assets by appraising and developing existing discoveries and exploring in areas assessed by management to be of moderate risk. With a total of eight blocks (seven operated) and approximately 597,000 acres (478,000 net acres) in Colombia, the Corporation's management expects that C&C Energia has considerable upside for future production and reserve growth.


This press release contains forward-looking information within the meaning of applicable Canadian securities laws that involves known and unknown risks and uncertainties. Forward-looking information typically contains statements with words such as "anticipate", "estimate", "expect", "potential", "could", "will", "plans" or similar words suggesting future outcomes. The Corporation cautions readers and prospective investors in the Corporation's securities to not place undue reliance on forward-looking information as by its nature, it is based on current expectations regarding future events that involve a number of assumptions, inherent risks and uncertainties, which could cause actual results to differ materially from those anticipated by C&C Energia.

Forward-looking information in this press release includes, but is not limited to, information concerning the expectations of the Corporation with respect to the Corporation's planned operating and capital budget for 2013, the Corporation's future production for 2012 as a whole and the Corporation's drilling plans in each of the Cravoviejo, Cachicamo, Llanos-19, Coati and Putumayo-8 blocks, expectations regarding future reductions of inventory levels and expectations regarding the timing of drilling results, the timing for completion of civil works, receipt and timing of final confirmation in relation to the Colombian Bid Round and the timing of the execution of an exploration and production contract with respect to the LLA-83 Block and receipt of approvals for certain of its wells. These forward-looking statements are subject to assumptions regarding the Corporation's operations and the operating environment in Colombia. In particular, for 2012 as a whole, estimates of inventory levels, drilling plans and expectations regarding the timing of drilling results and regulatory approvals are based on the assumptions that the Corporation's plans will be completed without any undue difficulty, that costs will not rise significantly and that events will not cause disruptions in the delivery of the Corporation's oil production to market. The Corporation's capital program and drilling are subject to change if circumstances change or if management of the Corporation determines that other business plans are more appropriate.

Forward-looking information involves significant known and unknown risks and uncertainties. A number of factors could cause actual results to differ materially from those anticipated by C&C Energia including, but not limited to, general risks associated with the oil and gas industry (e.g. operational risks in exploration; inherent uncertainties in interpreting geological data; changes in plans with respect to exploration or capital expenditures; the uncertainty of estimates and projections in relation to costs and expenses and health, safety and environmental risks, potential risks arising from trucking and other delivery disruptions), the risk of commodity price and foreign exchange rate fluctuations, the uncertainty associated with the negotiating with the ANH or with other third parties in countries other than Canada and the risks associated with international activity. The forward-looking information included in this news release is expressly qualified in its entirety by this cautionary statement. The forward-looking information included herein is made as of the date hereof and C&C Energia assumes no obligation to update or revise any forward-looking information to reflect new events or circumstances, except as required by law.


The Corporation's financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") which are generally accepted accounting principles for publicly accountable enterprises in Canada ("GAAP").

This report makes reference to the terms that do not have a standardized meaning prescribed by GAAP and accordingly, the Corporation's use of these terms may not be comparable to similarly defined measures presented by other companies.

Additional GAAP Measures

The term "funds flow from operations" is an additional GAAP measure because it is presented in Note 12 to the annual consolidated financial statements. Funds flow from operations is cash flow from operating activities before changes in non-cash working capital.

Non-GAAP Measures

The terms "operating cash flow", "operating netbacks", "netbacks" and "adjusted working capital", are non-GAAP measures because they are not presented in the 2011 annual consolidated financial statements. Operating cash flow is oil revenues less royalties, operating expenses, transportation expenses and administration expenses. Operating netback is determined by dividing oil sales revenues less royalties, production expenses and transportation expenses by sales volumes.

Management considers netback and operating netback important as it is a measure of profitability per barrel sold and reflects the quality of production. Netbacks are calculated by subtracting royalties, production expenses, transportation expenses, administrative expenses, interest and taxes paid by the Corporation from crude oil revenue and dividing by sales volumes. Adjusted working capital surplus includes current assets less current liabilities, excluding risk management contracts (unrealized gains (losses) on commodity swaps) and deferred income taxes and is used to evaluate the Corporation's financial leverage.

Management uses these additional and non-GAAP measurements for its own performance measures and to provide its shareholders and potential investors with a measurement of the Corporation's efficiency and its ability to fund a portion of its future growth expenditures.

C&C Energia Ltd.
Ken Hillier
Chief Financial Officer

C&C Energia Ltd.
Tyler Rimbey
Vice President, Business Development

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
It is of utmost importance for the future success of WebRTC to ensure that interoperability is operational between web browsers and any WebRTC-compliant client. To be guaranteed as operational and effective, interoperability must be tested extensively by establishing WebRTC data and media connections between different web browsers running on different devices and operating systems. In his session at WebRTC Summit at @ThingsExpo, Dr. Alex Gouaillard, CEO and Founder of CoSMo Software, presented ...
DXWorldEXPO LLC, the producer of the world's most influential technology conferences and trade shows has announced the 22nd International CloudEXPO | DXWorldEXPO "Early Bird Registration" is now open. Register for Full Conference "Gold Pass" ▸ Here (Expo Hall ▸ Here)
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, discussed how they built...
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, discussed key challenges and solutions to powering a ride sharing and/or multimodal model in the age ...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...
Detecting internal user threats in the Big Data eco-system is challenging and cumbersome. Many organizations monitor internal usage of the Big Data eco-system using a set of alerts. This is not a scalable process given the increase in the number of alerts with the accelerating growth in data volume and user base. Organizations are increasingly leveraging machine learning to monitor only those data elements that are sensitive and critical, autonomously establish monitoring policies, and to detect...
Data is the fuel that drives the machine learning algorithmic engines and ultimately provides the business value. In his session at Cloud Expo, Ed Featherston, a director and senior enterprise architect at Collaborative Consulting, discussed the key considerations around quality, volume, timeliness, and pedigree that must be dealt with in order to properly fuel that engine.
In his session at @ThingsExpo, Dr. Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, presented the findings of a series of six detailed case studies of how large corporations are implementing IoT. The session explored how IoT has improved their economic performance, had major impacts on business models and resulted in impressive ROIs. The companies covered span manufacturing and services firms. He also explored servicification, how manufacturing firms shift from se...
IoT solutions exploit operational data generated by Internet-connected smart “things” for the purpose of gaining operational insight and producing “better outcomes” (for example, create new business models, eliminate unscheduled maintenance, etc.). The explosive proliferation of IoT solutions will result in an exponential growth in the volume of IoT data, precipitating significant Information Governance issues: who owns the IoT data, what are the rights/duties of IoT solutions adopters towards t...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settl...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, examined the regulations and provided insight on how it affects technology, challenges the established rules and will usher in new levels of diligence arou...
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smart...
IoT is rapidly becoming mainstream as more and more investments are made into the platforms and technology. As this movement continues to expand and gain momentum it creates a massive wall of noise that can be difficult to sift through. Unfortunately, this inevitably makes IoT less approachable for people to get started with and can hamper efforts to integrate this key technology into your own portfolio. There are so many connected products already in place today with many hundreds more on the h...
Here are the Top 20 Twitter Influencers of the month as determined by the Kcore algorithm, in a range of current topics of interest from #IoT to #DeepLearning. To run a real-time search of a given term in our website and see the current top influencers, click on the topic name. Among the top 20 IoT influencers, ThingsEXPO ranked #14 and CloudEXPO ranked #17.