Madalena Energy Inc.
Company Summary
Description
Madalena Energy is an independent, Canadian-based, international and domestic upstream oil and gas company whose main business activities include exploration, development and production of crude oil, natural gas liquids and natural gas. Internationally, Madalena holds a large land position of over 950,000 acres in Argentina and efficiently executes full cycle operations across all aspects of its oil and gas business. In Argentina, Madalena is focused on the delineation of large petroleum in-place shale and unconventional resources in both the Vaca Muerta and Lower Agrio shales, in addition to multiple tight sand plays throughout the Company's portfolio of assets. The Company is also focused on implementing horizontal drilling and completions technology to develop high impact conventional, and scalable resource plays, for light oil and liquids-rich gas. Domestically, Madalena's core area of operations is located in Western Canada in the Greater Paddle River area of west-central Alberta where the Company holds approximately 170 gross (130 net) sections of land (approximately 76% average W.I.) encompassing light oil and liquids-rich gas plays. Madalena's primary domestic focus is to exploit its inventory of horizontal drilling locations on its Ostracod oil and other oil and liquids-rich gas plays. Madalena trades on the TSX Venture Exchange under the symbol MVN and in the United States under the OTCQX public market: MDLNFWebsite
http://www.madalenaenergy.com/Related Entities
Recent news
- 2/26/2019 - Madalena Energy Reports... (subscriber access)
- 1/10/2019 - Madalena Energy Plans to... (subscriber access)
- 1/10/2019 - Madalena Divests 100%... (subscriber access)
- 1/10/2019 - Madalena Energy Reports... (subscriber access)
- 1/10/2019 - Madalena Energy Reports... (subscriber access)
Company Transactions
Date: 6/29/2016
Type: Acquisition
REGIONS:
Western Canadian Sedimentary Basin
News & Press Releases
Criterion News
- 2/26/2019 - Madalena Energy Reports... (subscriber access)
- 1/10/2019 - Madalena Energy Plans to... (subscriber access)
- 1/10/2019 - Madalena Divests 100%... (subscriber access)
- 1/10/2019 - Madalena Energy Reports... (subscriber access)
- 1/10/2019 - Madalena Energy Reports... (subscriber access)
- 10/30/2017 - Madalena Energy & Pan... (subscriber access)
- 8/30/2017 - Madalena Energy Reports... (subscriber access)
- 8/30/2017 - Madalena Energy... (subscriber access)
- 8/14/2017 - Madalena Energy Assigned... (subscriber access)
- 7/10/2017 - Madalena Energy Issues... (subscriber access)
- 5/1/2017 - Madalena Reports 4Q16... (subscriber access)
- 5/1/2017 - Madalena Reports 4Q16... (subscriber access)
- 1/26/2017 - Madalena Sells Shares of... (subscriber access)
- 12/22/2016 - Madalena Disposes of... (subscriber access)
- 12/21/2016 - Madalena Completes Sale... (subscriber access)
- 8/24/2016 - Madalena Energy's Total... (subscriber access)
- 8/24/2016 - Madalena Energy's... (subscriber access)
- 8/24/2016 - Madalena Energy's... (subscriber access)
- 6/29/2016 - Madalena Energy Announce... (subscriber access)
- 2/10/2016 - Point Loma to Purchase... (subscriber access)
Press Releases
- Madalena closed the previously announced Coirón Amargo Sur Este ("CASE") transaction in January 2017, providing the Company with cash payments of $10 million, $3 million of which was received in December 2016 and the balance in January 2017;
- The 2017 work program at CASE has commenced. A Vaca Muerta horizontal trajectory of approximately 1,000 meters has been drilled and a liner has been run at CAS.x-15(r)(h);
- Madalena repaid and closed its $1.6 million Argentine debt facility in February 2017;
- Argentine oil prices are expected to converge with international Brent pricing over the coming months;
- Madalena sold 1.5 million free-trading shares of Point Loma Resources Ltd. ("Point Loma") in January 2017 for net proceeds of $0.5 million; and
- The Company sold 4.7 million escrowed common shares in Point Loma in April 2017 for gross cash proceeds of $0.8 million.
- The Working Capital Loan is a multi-drawdown facility of up to $6.5 million, which shall be used for general working capital purposes. Interest accrues at 7% per annum. Principal and interest on each drawdown is repayable thirty-six months after an advance of funds;
- The Capex Loan is a multi-drawdown convertible loan of up to $16.5 million. The loan similarly accrues interest at 7% per annum, with each drawdown and accrued interest repayable thirty-six months after drawdown. The Capex Loan is convertible into units of the Company ("Units") with each Unit comprised of one common share ("Common Share") and 0.22 of a Common Share purchase warrant ("Warrant"), with each Warrant entitling the holder to purchase an additional Common Share. The Capex Loan is convertible based on a conversion price equal to a 5% premium to the 20-day volume weighted average price ("VWAP") of the Common Shares on the last trading date prior to a particular drawdown ("Conversion Price") in respect of the Common Shares comprising the Units. The exercise price of the Warrants issued upon conversion is also at a 5% premium to that 20-day VWAP. These Warrants expire 18 months after the date of issuance. Both Hispania and Madalena have the right to convert the whole or part of the principal and interest owing hereunder into Units on or before repayment, although Madalena's right to compel conversion is limited in some circumstances; and
- Both loans are secured, limited to the Company's interests in the Rinconada-Puesto Morales concession.
- technical, operational, strategic and financial advice, direction and assistance in relation to the operation of Madalena's oil and natural gas properties, undeveloped lands and related assets in Argentina;
- advice to Madalena's officers and the board of directors regarding the business of Madalena; and
- such other services as requested by Madalena from time to time.
- Madalena closed the previously announced Coirón Amargo Sur Este ("CASE") transaction in January 2017, providing the Company with cash payments of $10 million, $3 million of which was received in December 2016 and the balance in January 2017;
- The 2017 work program at CASE has commenced. A Vaca Muerta horizontal trajectory of approximately 1,000 meters has been drilled and a liner has been run at CAS.x-15(r)(h);
- Madalena repaid its $1.6 million Argentine debt facility in full in February 2017;
- Argentine oil prices are expected to converge with international Brent pricing over the coming months;
- Madalena sold 1.6 million free-trading shares of Point Loma Resources Ltd. ("Point Loma") in January 2017 for net proceeds of $0.5 million; and
- The Company sold 4.7 million escrowed common shares in Point Loma in April 2017 for gross cash proceeds of $0.8 million. These common shares will be released from escrow in 20% increments in six month intervals commencing July 2017.
- Review of Strategic Alternatives
In April 2016, Madalena retained Evercore Group LLC ("Evercore") as its exclusive financial advisor in connection with identifying and securing a joint venture partner for the 90% working interest Curamhuele block in Argentina. In late June 2016, Evercore had its mandate broadened to encompass a complete review of strategic alternatives.
- Coirón Amargo
On July 11, 2016, the Company entered into definitive agreements whereby Coirón Amargo Sur (35% working interest) was divided into two evaluation lots – CASE and Coirón Amargo Sur Oeste ("CASO"). Madalena sold its interest in CASO in return for an additional 55% working interest at CASE, thereby increasing its working interest to 90% and becoming operator.
On December 7, 2016, the Company entered into agreements with Pan American Energy LLC, Sucursal Argentina ("PAE") relating to its 90% working interest at CASE. Pursuant to these agreements, Madalena received cash payments of an aggregate of $10 million on closing and sold a 55% working interest and operatorship to PAE, thereby retaining a 35% non-operated working interest in CASE. A 2017 work program ("Work Program"), comprised of two well re-entries, will be undertaken by PAE as the new operator of CASE. Madalena will receive $5.6 million in carried capital costs through this Work Program. Concurrently, PAE agreed, subject to certain conditions, to provide Madalena with a loan of up to $40 million, on a limited recourse basis, to be drawn-down as required to fund CASE capital expenditures. This limited recourse loan will bear interest at 7% per annum and is repayable in five years from the net revenue generated from the CASE capital expenditure program. This transaction closed on January 10, 2017.
- Curamhuele
The Yapai.x-1001 well was successfully completed in Q1-2016 with four hydraulic fractures, the upper three intervals being within the Lower Agrio shale and the lowest interval containing both the Lower Agrio shale and Mulichinco tight sand formations. Initial test results were sufficiently encouraging for the Company to request renewal of the Curamhuele evaluation concession for four years with a total of $8.2 million of work commitments to be incurred by March 9, 2019.
- Sale of Canadian Assets
On June 28, 2016, Madalena and Point Loma completed a transaction pursuant to which, Point Loma acquired Madalena's Canadian petroleum and natural gas assets in exchange for 6.2 million escrowed common shares of Point Loma, with a value of $1.9 million and a five-year $2.4 million secured convertible debenture ("Point Loma Convertible Debenture"), bearing interest at 3% per annum, payable at the end of the debenture term.
In December 2016, the Company sold the Point Loma Convertible Debenture for net cash proceeds of $0.5 million.
- Madalena Convertible Debenture Issuance
On July 13, 2016, the Company closed a private placement of CAD $1.8 million 12% secured convertible debentures, with a June 30, 2019 maturity date. The debentures are convertible into common shares of the Company at a conversion price of CAD $0.25 per common share any time after January 13, 2017. Interest on the debentures is payable semi-annually, in arrears, on December 31 and June 30. Under certain conditions, the Company may repay the outstanding indebtedness. Such repayments involve call premiums that reduce as the date to maturity approaches. - Argentina Proved plus Probable ("2P") reserves increased 8% from 9,134 MBoe to 9,899 MBoe, which include 2.3 Mboe (2015 – 0.9 Mboe) associated with the Company's undeveloped unconventional assets in the Vaca Muerta shale;
- Argentina 2P reserve replacement ratio was 108%; and
- 2P BTax NPV 10%, is $121.9 million or $0.22/share, including $29.4 million (2015 - $14.6 million) associated with the Company's undeveloped unconventional assets in the Vaca Muerta shale.
- Madalena will receive cash payments of an aggregate of $10 million by closing;
- Madalena will transfer a 55% WI and operatorship to PAE, retaining a 35% non-operated WI in CASE;
- a 2017 work program ("Work Program") will be undertaken by PAE, with a net benefit to Madalena of $5.6 million; and
- Madalena to obtain a limited recourse loan of up to $40 million, to be drawn-down as required to fund certain capital expenditures.
- increases Madalena's working interest ("WI") to 90% and provides for the Company's operatorship of a large portion of the evaluation concession in the south ("Coirón Amargo Sur");
- reduces the Company's near-term work commitments at Coirón Amargo Sur; and
- Madalena's 35% WI is retained in the exploitation concession in the north ("Coirón Amargo Norte").
- The CAS.x-16 well was drilled and rig released in December 2014. It encountered 125 metres of Vaca Muerta shale. The well was opened to flow unstimulated (no acidization or fracture treatments) on a 2 mm choke at a pressure of approximately 570 psi with an initial rate of 60 bopd light oil. The well produced approximately 3,800 bbls over a 290 day test period. The well has 7" casing set to the top of the Vaca Muerta, making it suitable for a horizontal re-entry.
- The CAS.x-15 well was drilled in 2014 and encountered 114 metres of Vaca Muerta. The well had continuous oil flows during the drilling operations. This well has 9 5/8" casing set to the top of the Vaca Muerta and the Company is in the planning stages for a horizontal re-entry with 10-15 hydraulic fractures.
- The CAS.x-14 well was drilled in 2013 and encountered 105 metres of Vaca Muerta. This well was never completed but has 7" casing set to the top of the Vaca Muerta and is also suitable for a horizontal re-entry.
- Oil and gas production averaged 3,274 boe/d (Q4-2014 – 4,075 boe/d) and 3,577 boe/d (2014 - 2,882 boe/d) for the fourth quarter and year, respectively;
- Proved plus probable reserves ("P+P") of 11.4 MMboe (2014 - 11.5 MMboe), primarily from the Company's conventional assets. Net present value of these P+P reserves before tax, discounted at 10% ("NPV10") was $127.2 million (2014 - $171.9 million);
- Argentina operating netbacks averaged $21.07/boe in the fourth quarter (Q4-2014 - $23.54/boe) and $26.07/boe for the year (2014 - $28.33/boe);
- Benchmark Medanito oil prices in 2015 averaged $75.00/bbl for the quarter (Q4-2014 -$83.60/bbl) and $75.92/bbl for the year (2014 - $80.35/bbl);
- Funds flow from operations were $3.7 million (Q4-2014 – $3.9 million) and $27.8 million (2014 -$16.5 million) for the quarter and year, respectively. Funds flow from operations were positively impacted by one-time oil price incentives of $16.8 million;
- Exited the year with a positive working capital position of $0.5 million which includes $3.9 million of current Argentine bank debt. The Company has an additional $2.0 million in long-term Argentine bank debt;
- Drilled, completed and placed on production three (35% WI) Sierras Blancas conventional light oil horizontal wells at Coiron Amargo and one (100% WI) Loma Montosa light oil multi-frac horizontal well at Riconada-Puesto Morales;
- Drilled one (100% WI) vertical exploration well in the quarter at Curamhuele and successfully completed the well in Q1-2016 with four hydraulic fractures, the upper three intervals being within the Lower Agrio shale and the lowest interval containing both the Lower Agrio shale and Mulichinco tight sand formations; and
- Drilled a fourth (35% WI) Sierras Blancas conventional light oil horizontal well at Coiron Amargo in the quarter and successfully completed and placed on production in the first quarter of 2016.
- Consolidated (Argentina and Canada) Proved plus Probable ("2P") are 11,366 MBoe compared to 11,494 MBoe last year;
- Argentina Proved plus Probable ("2P") reserves have increased 8% from 8,480 MBoe to 9,134 MBoe;
- Argentina 2P reserve replacement ratio was 158%;
- 2P BTax NPV 10%, which is primarily supported by the Company's conventional assets, is $175,980,000 or $0.32/share and does not include any material value for the Company's unconventional assets in the Vaca Muerta shale and Lower Agrio shale which are included in the independent resource evaluations; and
- Consolidated oil and liquids now account for 78% of the 2P reserves up from 72% last year.
- The Company initiated and conducted independent resource evaluations on three of its twelve blocks in Argentina;
- Best Estimate Contingent Resources attributed to the Vaca Muerta shale at the Coiron Amargo block of 91.5 MMBOE (152.4 MMBOE Unrisked);
- Best Estimate Contingent Resources on the Valle Morado block of 75.3 Bcf (Unrisked 117.1 Bcf);
- On the Curamhuele block, Lower Agrio shale Best Estimate Risked Prospective Resources of 99.4 MMBOE (Unrisked 365.4 MMBOE);
- Also on the Curamhuele block, Vaca Muerta shale Best Estimate Risked Prospective Resources of 92.6 MMBOE (Unrisked 1,157.1 MMBOE);
- Madalena's Total Contingent Resources are 105.2 MMBOE (172.7 MMBOE Unrisked); and
- Madalena's Total Prospective Resources are 192.0 MMBoe (1,522.5 MMBOE Unrisked).
- Successfully completed the vertical exploration well (Yapai.x-1001) with four hydraulic fractures at depths of 3,731, 3,647, 3,566 and 3,457 metres, the upper three intervals being within the Lower Agrio shale and the lowest interval containing both the Lower Agrio shale and Mulichinco tight sand formations;
- All four frac intervals are believed to have penetrated the primary target in the Lower Agrio shale;
- Pumped an aggregate of approximately 430,000 pounds of sand and 13,700 barrels of frac water over four days;
- Flowed back on controlled choke settings (3 mm to 8 mm) over eight days a total of 1,609 Bbls of oil and 5,444 Bbls of water;
- Flowed at 408 Boe/d over last 24 hours on a 9.5 mm choke, comprised of 350 Bbls/d oil, 389 Bbl/d water (47% oil cut) and 350 mcf/d of gas at a flowing pressure of 1,050 psi;
- The oil is light sweet oil with a field estimated gravity of 40 API;
- Recovered approximately 40% of the hydraulic fracture fluid to date; and
- Continued to record an increase in the oil cut and a corresponding decrease in the water percentage throughout the test.
- Existing wellbore penetrations with oil shows and tests indicating a relatively thick shale with total organic carbon > 3% and porosity of 4-10%;
- 3D seismic coverage across half of the block;
- Significantly over pressured reservoir based on mud weights and bottom hole pressure tests; and,
- Stacked development scenarios with two Hz MF wells per spacing unit improve capital efficiencies.
- Depth (3,600-3,800 m) and complexity of drilling operations;
- Surface topography being in the foothills of the Andes and more remote to the oil and gas service industry; and
- No immediately proximate analogs.
- There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources referred to in the table above.
- The portion of the estimate of UPIIP that is not classified as Prospective Resources is currently classified as Undiscovered Unrecoverable Petroleum Initially In Place.
- Tables may not add due to rounding.
- The Prospective Resources have been sub-classified as a Lead.
- Risks are based on Chance of Discovery 32%, Chance of Development 25% for an aggregate risk of 8%.
- 3D seismic coverage across half of the block;
- Significant gross thickness at 700 – 800 m;
- Stacked development scenarios with two to four Hz MF wells per spacing unit improve capital efficiencies; and
- Basin wide development of the Vaca Muerta.
- Depth (4,000+ m) and complexity of drilling operations;
- Surface topography being in the foothills of the Andes and more remote to the oil and gas service industry; and
- No offsetting commercial analogs.
Madalena announces attendance at the Nape Summit, Houston, February 8-9
Source: PR Newswire
Orignial Article: https://www.prnewswire.co...
CALGARY, Feb. 7, 2018 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce that the Company will be attending the NAPE Summit Exhibition in Houston on Thursday, February 8 and Friday, February 9, 2018. Madalena will be installed at Booth 1356, adjacent to the Mobile Office, in the main conference hall.
About Madalena Energy
Madalena is an independent, Canadian upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
2/7/2018Madalena Announces Appointment of Permanent Chief Financial Officer
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, June 28, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce the appointment of Mr. Ezequiel Martinez Ariet as permanent Chief Financial Officer of the Company, effective as of July 1, 2017. Mr. Martinez replaces Madalena Director Alejandro Augusto Penafiel, who assumed an Interim CFO role on May 31, 2017, following the transfer of executive management functions from Canada to Argentina. The Madalena board of directors would like to thank Mr. Alejandro Augusto Penafiel for his diligent work and assistance in facilitating the transition between management regimes.
Mr. Martinez, who will leave his position as Administrative and Financial Manager at AESA in Argentina, will bring 15 years of financial, strategic and operational experience to Madalena. He will be based in Buenos Aires and will report directly to Madalena Chief Executive Officer, Jose David Penafiel. Mr. Penafiel commented, "Having had the privilege of working with Mr. Martinez on projects in the past, I am fully confident that his knowledge, expertise and experience will greatly enhance the management team at Madalena and offer invaluable leadership, both during this current period of reorganization and beyond. His precise insight into the E&P market in Argentina makes him the perfect candidate for the position of CFO of Madalena."
An Accountancy graduate from Salvador University with post-graduate diplomas from the Professional Council of Economic Sciences CABA (IFRS and ISAs), the IAE Business School (Business Management) and the Catholic University of Argentina (Finance), Mr. Martinez combines vast proficiency in Accounting, Administration, Tax and Finance with abundant experience in the geographical region. After acting as Head of Accounting at Argentinian energy giant YPF, he moved on to the position of CFO at Petrolera San Jose before leading the financial team as Administrative and Financial Manager at AESA – a subsidiary of YPF – with some 5,000 employees and a net income of around $460 million (USD).
About Madalena Energy
Madalena is an independent, Canadian upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to the Company's future plans and the timing of certain matters. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
6/28/2017Madalena Announces the Issuance of Warrants to Hispania Petroleum S.A.
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in Canadian Dollars, unless otherwise noted)
CALGARY, June 13, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces that, in connection with the previously announced services agreement ("Services Agreement") the Company entered into with Hispania Petroleum S.A. ("Hispania"), it issued an aggregate of 4,758,333 common share purchase warrants ("Warrants") to Hispania for services rendered pursuant to the Services Agreement. Each Warrant entitles the holder thereof to acquire one common share ("Common Share") in the capital of the Company at any time prior to January 8, 2019 at an exercise price of $0.145. The Common Shares issuable on exercise of the Warrants will be issued to Hispania as fully paid and non-assessable Common Shares of the Company.
The Warrants issued in connection with the Services Agreement and the Common Shares issued on exercise thereof are subject to a four month plus one day hold period.
About Madalena Energy
Madalena is an independent, Canadian Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
SOURCE Madalena Energy Inc.
Article Date
6/13/2017Madalena Announces Investor Conference Call for Wednesday June 7, 2017
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, June 1, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce that the Company plans to hold an investor conference call to provide an introduction to the new executive management team and the Company's key focus areas on Wednesday June 7, 2017 at 8:00 am MDT (10:00 am EDT).
To participate in the conference call, please dial:
(+1) 587 880 2171 (local dial in number)
(+1) 888 390 0546 (toll free dial in number in North America)
08006522435 (toll free dial in number in United Kingdom)
08004448221 (toll free dial in number in Argentina)
About Madalena Energy
Madalena is an independent, Canadian Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
6/1/20175/30/2017 - Madalena Announces Q1 - 2017 Results
Madalena Announces Q1 - 2017 Results
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars)
CALGARY, May 30, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to provide its operating and financial results for the three months ended March 31, 2017. Selected information is outlined below and should be read in conjunction with Madalena's unaudited condensed interim consolidated financial statements for the three months ended March 31, 2017 and the associated management's discussion and analysis, which are available for review under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com.
Outlook
Madalena has successfully completed the strategic alternatives process which it initiated in June 2016. On May 8, 2017, Madalena entered into a series of agreements with Hispania Petroleum S.A., ("Hispania") a private, family-owned Spanish energy company which has operated in multiple countries, including Argentina, for three generations. The agreements provide for a package of debt and mezzanine financing which, once completed, are expected to alleviate Madalena's liquidity challenges (the "Working Capital Loan") and provide the Company access to growth capital for drilling and investment activities (the "Capex Loan"). These agreements are subject to certain regulatory and shareholder approvals. The Company expects to hold its annual and special meeting of shareholders in July 2017 to, among other things, approve the Capex Loan.
Jose David Penafiel, Hispania's CEO, was appointed CEO of Madalena effective May 8, 2017 and he and Alejandro Augusto Penafiel have joined Madalena's Board of Directors. Effective May 31, 2017, Alejandro Penafiel will assume the Interim CFO role as the Company conducts a search for a permanent CFO.
In order for new management to successfully transition and streamline operations, the companies have entered into a services agreement (the "Services Agreement") whereby Hispania's personnel, in Argentina and elsewhere, will be made available to Madalena.
As a result of transferring the executive management functions to Argentina, the Interim President and Chief Executive Officer and the Vice President, Exploration and New Ventures departed the Company on May 8, 2017 and the Vice President, Finance and Chief Financial Officer will depart on May 31, 2017.
Recent Highlights in 2017
SUMMARY FINANCIAL AND OPERATIONAL RESULTS
|
Three months ended March 31 | ||
|
2017 |
2016 | |
|
Financial – US Dollars ($000s, except per share amounts) |
||
|
Oil and gas revenue |
10,336 |
14,811 |
|
Funds flow from (used in) operations(1) |
(2,998) |
3,159 |
|
Per share - basic & diluted(1) |
(0.01) |
0.01 |
|
Net income (loss) |
320 |
(6,491) |
|
Per share – basic and diluted |
0.00 |
(0.01) |
|
Capital expenditures |
665 |
4,861 |
|
Working capital |
5,232 |
(4,413) |
|
Common shares outstanding - 000s |
543,780 |
542,100 |
|
Operating |
||
|
Average Daily Sales |
||
|
Crude oil and Ngls – Bbls/d |
1,899 |
2,409 |
|
Natural gas – Mcf/d |
2,005 |
2,976 |
|
Total - Boe /d |
2,233 |
2,905 |
|
Average Sales Prices |
||
|
Crude oil and Ngls - $/Bbl |
55.70 |
62.19 |
|
Natural gas - $/Mcf |
4.53 |
4.35 |
|
Total - $/Boe |
51.43 |
56.03 |
|
Operating Netbacks(2) - $/Boe |
15.87 |
24.82 |
|
(1) |
This table contains the term "funds flow from (used in) continuing operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flow from (used in) operating activities " as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from (used in) operations and funds flow from (used in) operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from (used in) continuing operations to analyze operating performance and considers funds flow from (used in) continuing operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from (used in) continuing operations and cash flow from (used in) operating activities can be found in the MD&A. Funds flow from (used in) continuing operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(2) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
As at March 31, 2017, the Company reported net income from continuing operations of $0.3 million, had working capital of approximately $5.2 million and significant future capital commitments to develop its properties. It is anticipated that currently available resources in addition to forecasted cash flow from operating activities will not be sufficient to resolve the anticipated capital commitments through 2017 and 2018.
As a result, for the three months ended March 31, 2017, the Company continues to include a note of going concern uncertainty in the condensed interim consolidated financial statements.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to addressing the Company's liquidity challenges, the Company's future plans and the timing of certain matters. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
5/30/2017Madalena announces successful completion of its strategic alternatives process
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars, unless otherwise noted)
CALGARY, May 8, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce the successful completion of the strategic alternatives process which it initiated in June of 2016.
On May 8, 2017, Madalena entered into a series of agreements with Hispania Petroleum S.A., ("Hispania") a private, family-owned Spanish energy company which has operated in multiple countries, including Argentina, for three generations. The agreements provide for a package of debt and mezzanine financing which, once implemented, are expected to resolve Madalena's liquidity challenges (the "Working Capital Loan") and provides the Company access to growth capital for drilling and investment activities (the "Capex Loan").
Jose David Penafiel, Hispania's CEO, has been appointed CEO of Madalena, and he and Alejandro Augusto Penafiel will join Madalena's Board of Directors. In order for new management to successfully transition and streamline operations, the companies have entered into a services agreement (the "Services Agreement") whereby Hispania's personnel, in Argentina and elsewhere, will be made available to Madalena.
Jose David Penafiel, Madalena's new CEO, is highly qualified to oversee the next phase of Madalena's growth. Mr. Penafiel is a University of Oxford graduate and was the General Manager of Hispania's Argentina operations for 7 years. During that time, Mr. Penafiel successfully assisted Hispania's Chairman in negotiations to take over operatorship of Area Puesto Guardian, and also led successful negotiations to acquire the 40% stake held by Antrim Energy Inc. in Area Puesto Guardian in Argentina. Mr. Penafiel later concluded a farm-in agreement with President Energy PLC for a 50% stake in Area Puesto Guardian, and sold the remaining 50% stake of the concession in July 2014. Mr. Penafiel has managed multiple drilling campaigns in Argentina, as well as unconventional drilling operations in Texas in the Permian Basin. Mr. Penafiel brings to Madalena a long history working in the energy industry, with most of that experience focused in Latin America.
This transformative transaction provides Madalena with sophisticated leadership, financially aligned with shareholders and experienced in working in Argentina, and with committed growth capital. With leadership concentrated in Argentina, the Company can implement cost controls and can achieve meaningful efficiencies. The growth capital will enable the Company to properly develop its conventional and unconventional assets. In summary, this marks a new chapter for Madalena, with a renewed focus on operational productivity and enterprise growth.
Highlights:
The Company has entered into two credit facilities with Hispania, with a total of $23 million of availability, which will be utilized on an as-needed basis:
The Services Agreement has an initial term of one year, but may be extended by agreement. Pursuant to the Agreement, Hispania's personnel will provide:
In association with the Services Agreement, Madalena will issue Warrants to Hispania in six consecutive monthly tranches of 4,758,333 Warrants. These Warrants will have an exercise price equal to the price of the Common Shares on the last trading day prior to issuance and will expire 18 months thereafter.
New Focus
The Company is reducing its Canadian presence as it transfers executive management functions to Argentina. To that end, Mr. Steve Dabner, VP Exploration and New Ventures and Mr. Thomas Love, VP Finance and Chief Financial Officer will depart the Company. Mr. Dabner will depart immediately, and Mr. Love, effective May 31, 2017. The Madalena board of directors wishes to thank Messrs Dabner and Love for their significant contributions to the Company.
The Madalena board of directors wishes to extend its gratitude to its Chairman and Interim CEO, Steven Sharpe. Without his leadership, commitment and personal sacrifice, the Company would not have achieved this successful result, which positions Madalena to grow and prosper. As well as relinquishing his title as Interim President and CEO, Steven has expressed his intention to step down as the Chair, and has tendered his resignation as a Madalena director.
"My work here is done", Steven commented, "The challenges we have faced over the last while have been truly enormous, but I believe Madalena's future prospects are bright and its ability to pursue them assured. I have spent much time with Jose over the last months as we put this deal together. The Company is in good hands."
Shareholder Support
Maglan Capital LP, Madalena's largest shareholder, has expressed its full support of the transactions with Hispania and the appointment of the new CEO and directors.
David Tawil, President of Maglan Capital stated: "We are excited for the next chapter in Madalena's development. It speaks volumes about the quality of Madalena's assets and operations, that the Company was able to attract such a qualified and experienced investor group and leader."
Steven Azarbad, Chief Investment Officer of Maglan Capital added: "We are committed to working with the new CEO and the Board to realize the potential which we believe exists for all Madalena shareholders. We thank Mr. Sharpe and the rest of the board for their efforts in consummating this transaction."
About Hispania
Hispania Petroleum began operations in the 1980's focused initially on trading crude oil and products and then transitioned into exploration and production. Hispania has had great success operating in the Russian market with a steady increase in production since 1992 from the oil fields in the Perm region that it operates alongside its joint venture partner, Lukoil. Hispania began its operations in Argentina in 1991 after acquiring Area Puesto Guardian in the Noroeste basin. Hispania's operations in Argentina were focused on redeveloping Puesto Guardian's five oil fields. The company's redevelopment project was successful by maintaining low operational costs.
Mr. Jose David Penafiel stated: "We are excited about the opportunity to focus on Argentina once again. Madalena has solid production from its existing fields, and holds significant exploitation potential with the ability to materially grow production through a clearly thought out near-term drilling and completion program in its core Vaca Muerta position.
The Hispania group considers Argentina a very fertile location to build a major hydrocarbon producing business, making material investments in the local economy, engaging with well-connected partners, streamlining the local workforce while continuing to benefit the communities where the Company operates. We expect to achieve rapid progress in the short- to medium-term in this regard."
Annual and Special Meeting of Madalena Shareholders
These transactions are subject to certain regulatory and shareholder approvals. The Company expects to hold its annual and special meeting of shareholders in June, 2017 to, among other things, approve the Capex Loan and attend to annual meeting matters.
About Madalena Energy
Madalena is an independent, Canadian Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to addressing the Company's liquidity challenges, the Company's future plans and the timing of certain matters. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
5/8/20175/1/2017 - Madalena Announces its 2016 Year End Financial and Operating Results and Year End Reserves
Madalena Announces its 2016 Year End Financial and Operating Results and Year End Reserves
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars)
CALGARY, May 1, 2017 /PRNewswire/ - Madalena Energy Inc. (the "Company" or "Madalena") (TSXV: MVN and OTCQX: MDLNF) announces its financial and operating results for the three months and year ended December 31, 2016 and the Company's 2016 year end reserves. The Company also announces that its audited consolidated financial statements for the year ended December 31, 2016, the related management's discussion and analysis (the "MD&A") and the Annual Information Form (the "AIF") for the year ended December 31, 2016 will be available on the System for Electronic Document Analysis and Retrieval ("Sedar") under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com.
Recent Highlights in 2017
Outlook
With the assistance of Evercore Group Inc., the Company is actively pursuing strategic alternatives with a view to enhance liquidity and meet ongoing capital commitments. There can be no guarantee that this review will result in a transaction(s), or if a transaction(s) is undertaken, as to its terms or timing. At the same time, the Board of Directors is seeking to identify the appropriate CEO candidate to lead the Company.
Highlights in 2016
The Company entered 2016 with liquidity restraints due to limited working capital. Accordingly, the focus for 2016 was directed towards accessing additional funding and opportunities to monetize assets. Changes in management and the Board were made in March 2016 with Mr. Steven Sharpe, Chairman of the Board appointed as Interim President and Chief Executive Officer and Mr. Eric Mark appointed to the Board as an independent director. Both have significant experience in corporate restructurings, capital and debt markets.
Measures were taken to reduce expenses and conserve cash. Office and field personnel have been reduced in both countries, office space has been downsized in Canada and other costs saving measures were implemented.
2016 Activity
SUMMARY FINANCIAL AND OPERATIONAL RESULTS
|
Three months ended December 31 |
Year ended December 31 | |||
|
2016 |
2015 |
2016 |
2015 | |
|
Financial – ($000s, except per share amounts) |
||||
|
Oil and gas revenue |
10,543 |
17,902 |
50,152 |
81,725 |
|
Funds flow from (used in) continuing operations(1) |
(325) |
4,007 |
5,494 |
29,377 |
|
Per share - basic & diluted(1) |
(0.00) |
0.01 |
0.01 |
0.05 |
|
Net income (loss) from continuing operations |
(9,402) |
(12,510) |
(32,100) |
(6,164) |
|
Per share - basic & diluted(1) |
(0.02) |
(0.02) |
(0.06) |
(0.01) |
|
Capital expenditures |
331 |
12,679 |
6,339 |
40,936 |
|
Working capital (deficiency) |
(4,413) |
462 |
(4,413) |
462 |
|
Common shares outstanding - 000s |
543,780 |
542,083 |
543,780 |
542,083 |
|
Operating |
||||
|
Average Daily Sales |
||||
|
Crude oil and Ngls – Bbls/d |
1,947 |
2,549 |
2,072 |
2,749 |
|
Natural gas – Mcf/d |
2,303 |
3,363 |
2,569 |
3,887 |
|
Total - Boe /d |
2,330 |
3,110 |
2,500 |
3,397 |
|
Average Sales Prices |
||||
|
Crude oil and Ngls - $/Bbl |
53.59 |
70.65 |
60.09 |
74.60 |
|
Natural gas - $/Mcf |
4.47 |
4.31 |
4.87 |
4.84 |
|
Total - $/Boe |
49.18 |
62.58 |
54.81 |
65.91 |
|
Operating Netbacks(2) - $/Boe |
11.21 |
23.08 |
20.28 |
28.40 |
|
(1) |
This table contains the term "funds flow from (used in) continuing operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flow from operating activities " as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from (used in) operations and funds flow from (used in) operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from (used in) continuing operations to analyze operating performance and considers funds flow from (used in) continuing operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from (used in) continuing operations and cash flow from operating activities can be found in the MD&A. Funds flow from (used in) continuing operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(2) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
For the year ended December 31, 2016, the Company reported a net loss from continuing operations of $32.1 million, had a working capital deficit of approximately $4.4 million and significant future capital commitments to develop its properties. It is currently anticipated that forecasted cash flow from operating activities will not be sufficient to resolve the current working capital deficit and fund the anticipated capital commitments through 2017. As a result, for the year ended December 31, 2016, the Company continued to include a note of going concern uncertainty in the consolidated financial statements.
Summary of 2016 Reserves
The reserve report ("GLJ Report") was prepared in accordance with the definitions, standards and procedures contained in NI 51-101 and the COGE Handbook by GLJ Petroleum Consultants. The GLJ Report contains several cautionary statements that are required by NI 51-101 and the reserves information presented is subject to the contents of the full reports.
Year End 2016 Reserves Highlights:
The following tables provide a summary of the Company's oil and gas working interest reserves before royalties and net present value of future net revenue at December 31, 2016 using forecast prices and costs.
Reserves Summary
|
Light & Medium Oil & NGL |
Tight Oil |
Conventional Gas |
Shale Gas |
BOE | |
|
(Mbbl) |
(Mbbl) |
(MMcf) |
(MMcf) |
(MBOE) | |
|
Proved Developed Producing |
2,319 |
- |
2,657 |
- |
2,762 |
|
Proved Developed Non-Producing |
384 |
24 |
273 |
20 |
458 |
|
Proved Undeveloped |
1,275 |
904 |
827 |
741 |
2,440 |
|
Total Proved |
3,978 |
928 |
3,757 |
761 |
5,659 |
|
Total Probable |
2,574 |
1,066 |
2,727 |
874 |
4,240 |
|
Total Proved + Probable |
6,552 |
1,994 |
6,484 |
1,635 |
9,899 |
Summary of Net Present Values of Future Net Revenue(1)
Forecasted Prices and Costs(2)
Before Income Taxes, Discounted at (%/year)
|
As at December 31, 2016 | ||||||
|
0% |
10% |
15% | ||||
|
$000s |
$000s |
$000s | ||||
|
Proved Developed Producing |
36,908 |
35,731 |
33,534 | |||
|
Proved Developed Non-Producing |
13,988 |
9,836 |
8,401 | |||
|
Total Proved Developed |
50,896 |
45,567 |
41,935 | |||
|
Proved Undeveloped |
40,173 |
14,293 |
7,149 | |||
|
Total Proved |
91,069 |
59,861 |
49,084 | |||
|
Probable |
121,327 |
62,068 |
46,753 | |||
|
Total Proved + Probable |
212,397 |
121,929 |
95,837 | |||
|
1) |
It should not be assumed that the present value of estimated future net cash flows shown above are representative of the fair market value of the reserves. |
|
2) |
Based on GLJ's forecasted prices for Argentina as of January 1, 2017. |
|
3) |
Tables may not add due to rounding. |
As at December 31, 2016, Madalena held a 90% working interest ("WI") in CASE, which includes all of the tight oil and shale gas reserves disclosed above. In a news release dated January 11, 2017, the Company announced the closing of the sale of 55% of its working interest at CASE. As a result, the Company now holds a 35% WI in the CASE evaluation block.
The impact on the reserves and the net present values are as follows:
|
Total reserves |
NPV of Future Net Revenue Before Income Taxes |
||||
|
December 31 2016 Mboe |
January 11 2017 MBoe |
December 31 2016 $000s |
January 11 2017 $000s |
Change $000s | |
|
Total Proved |
5,659 |
5,013 |
59,861 |
58,426 |
(1,435) |
|
Probable |
4,240 |
3,500 |
62,068 |
51,430 |
(10,638) |
|
Total Proved & Probable |
9,899 |
8,513 |
121,929 |
109,856 |
(12,073) |
As a result of the sale of 55% of CASE, proved plus probable reserves associated with the Company's undeveloped unconventional reserves in the Vaca Muerta were reduced by 1.4 million boe with an associated reduction in 10% NPV before tax of $12.1 million. Total consideration received by the Company was $15.6 million ($10 million of cash and $5.6 million in carried costs).
Health, Safety, Environment ("HSE") and Corporate Social Responsibility ("CSR")
Madalena has a comprehensive HSE management plan for its employees and all contractors. In 2016 the Company continued to see major improvements in its key performance benchmarking indicators. For the 392,000+ person hours worked, there were no lost time incidents at any of the Company's facilities or operations. Also, in 2016 the Company recorded no reportable spills.
The Company takes pride in its CSR initiatives in Argentina. The Company is actively involved in supporting the communities in which it operates, through a number of initiatives including local employment programs, access to health care and improvement in the quality of services, education, water quality and technical assistance on sustainable agricultural production. In 2016 the Company fully implemented its community relations programs in both districts that it operates.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, production levels, the strategic value and opportunities available to Madalena, operational and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities and the Company's ability to meet its commitments and continue as a going concern or continue operating at all. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Analogous Information
Certain information in this news release may constitute "analogous information" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"), including, but not limited to, information relating to areas, assets, wells and/or operations that are in geographical proximity to or believed to be on-trend with lands held by Madalena. Such information has been obtained from public sources, government sources, regulatory agencies or other industry participants. Management of Madalena believes the information may be relevant to help define the reservoir characteristics within lands on which Madalena holds an interest and such information has been presented to help demonstrate the basis for Madalena's business plans and strategies. However, management cannot confirm whether such analogous information has been prepared in accordance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and Madalena is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor. Madalena has no way of verifying the accuracy of such information. There is no certainty that the results of the analogous information or inferred thereby will be achieved by Madalena and such information should not be construed as an estimate of future production levels or the actual characteristics and quality Madalena's assets. Such information is also not an estimate of the reserves or resources attributable to lands held or to be held by Madalena and there is no certainty that such information will prove to be analogous in the future. The reader is cautioned that the data relied upon by Madalena may be in error and/or may not be analogous to such lands to be held by Madalena.
Notes to Disclosure of Reserves
Volumes of reserves have been presented based on a company interest basis which includes Madalena's royalty interests without deducting royalties payable by the Company. Certain volumes are arithmetic sums of multiple estimates of Contingent and Prospective Resources, which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class as explained herein. The estimates of reserves and resources for individual properties may not reflect the same confidence level as estimates of reserves and resources for all properties, due to the effects of aggregation.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
5/1/2017Madalena Announces Sale of Point Loma Escrowed Common Shares
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars, unless otherwise noted)
CALGARY, April 24, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces that pursuant to a purchase and sale agreement dated April 21, 2017 with an arms-length third party (the "Transaction"), the Company sold 4,683,611 escrowed common shares in Point Loma Resources Ltd. ("Point Loma") for gross cash proceeds of $0.8 million (CAD 1.1 million). These common shares were acquired by Madalena pursuant to the sale of the Company's Canadian oil and gas assets in June 2016 and will be released from escrow in 20% increments in six month intervals commencing July 2017. Closing of the Transaction will take place in two equal tranches. The first tranche was completed on April 24, 2017 and the second tranche is expected to close on or about May 25, 2017.
The Company, as previously disclosed, has been experiencing liquidity challenges. Proceeds from the sale of these common shares do not resolve the liquidity challenges the Company is facing, however, the proceeds will provide assistance in continuing to manage the business.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentine focused upstream oil and gas company with operations in four provinces of Argentina where it is primarily focused on the delineation of unconventional oil and gas resources. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to addressing the Company's liquidity challenges. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
SOURCE Madalena Energy Inc.
Article Date
4/24/2017Coiron Amargo Sur Este - Drilling of Vaca Muerta Oil Resource Play
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars)
CALGARY, March 17, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce the commencement of the first horizontal multi-frac re-entry ("the Re-entry Program") in the Vaca Muerta shale formation at Coiron Amargo Sur Este ("CASE").
Madalena's partner, Pan American Energy LLC, Sucursal Argentina ("PAE") is the operator at CASE with a 55% working interest. Madalena and Gas y Petroleo del Neuquén, the provincial oil and gas company in the Province of Neuquén, hold 35% and 10% working interests, respectively.
PAE recently mobilized a drilling rig to the CAS.x-15(ST) location to re-enter the well and Madalena was advised that the Re-entry Program commenced today. The rig will drill horizontally for approximately 1,500 metres and will target the Vaca Muerta unconventional oil resource play at a vertical depth of approximately 3,200 metres. Subsequent to drilling, the drilling rig will be de-mobilized and preparations will commence to mobilize supplies, services and equipment to complete the well with approximately 19 stages of hydraulic fracs.
The total gross estimated cost of this Re-entry Program is $9.8 million, which includes the costs for drilling, completing and equipping the well.
Pursuant to the transactions previously described in the Company's January 11, 2017 and December 7, 2016 news releases, the 2017 work program at CASE is comprised of two well re-entries. Madalena will receive $5.6 million in carried capital costs through this work program.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to planned operations at CASE. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
3/17/20171/17/2017 - Madalena Provides Oil Pricing Update
Madalena Provides Oil Pricing Update
Source: PR Newswire
(All dollar figures are expressed in United States Dollars)
CALGARY, Jan. 17, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) has been advised that a majority of producers and refiners in Argentina, at the request of the government, have signed a 2017 Medanito crude oil pricing agreement (the "Agreement") allowing for convergence with international Brent pricing over the coming months. International Brent oil prices have been trading at approximately $55.00 per barrel to date in 2017.
A summary of Medanito monthly crude oil pricing for 2017 is as follows:
|
2017 |
$/Bbl |
|
January |
$59.40 |
|
February |
$58.70 |
|
March |
$57.90 |
|
April |
$57.20 |
|
May |
$56.50 |
|
June |
$55.70 |
|
July – December |
$55.00 |
Further, the Agreement outlines that should international Brent pricing be reached and remain higher than $1.00 above the monthly Medanito floor price for 10 consecutive days, the Agreement will be suspended and international Brent pricing adopted. Should international Brent pricing fall below $45.00 for 10 consecutive days, the Agreement will be reviewed.
For the first nine months of 2016 Madalena realized an average oil price of $62.10 per barrel which incorporated an average discount from the Medanito benchmark of approximately $5.00 per barrel. In the fourth quarter of 2016, Madalena expects to realize an average oil price of approximately $54.00 per barrel.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to commodity pricing. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
1/17/2017Madalena Announces Closing of Transactions with Pan American Energy
Source: PR Newswire
(All dollar figures are expressed in United States Dollars)
CALGARY, Jan. 11, 2017 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce that its previously announced transactions with Pan American Energy LLC, Sucursal Argentina ("PAE") relating to Madalena's 90% working interest ("WI") in the Coiron Amargo Sur Este block ("CASE") have closed and Madalena has received the balance of the $10 million consideration owed.
As a result of the transactions, PAE holds a 55% WI in, and operatorship of, CASE. Madalena retains a 35% non-operated WI in CASE, with the remaining 10% ownership of CASE held by Gas y Petroleo del Neuquén, the provincial oil and gas company in the Province of Neuquén, Argentina. Concurrently, PAE has agreed, subject to certain conditions, to provide Madalena with a loan of up to $40 million, on a limited recourse basis, to be drawn-down as required to fund certain capital expenditures. This limited recourse loan will bear interest at 7% per annum and is repayable in five years from the net revenue generated from the capital expenditure program.
The 2017 work program at CASE described in the Company's December 7, 2016 news release, comprised of, among other things, two well re-entries, will be undertaken by PAE as the new operator of CASE, with a net benefit to Madalena of up to $5.6 million in carried capital costs. PAE intends to initiate the first of two well re-entries as soon as possible.
Use of Proceeds
The proceeds from the transactions will be used to partially address the liquidity challenges currently being experienced by the Company. In particular, Madalena expects that the overdue amounts payable to the operator at Coiron Amargo Norte (described in the November 22, 2016 news release) will be satisfied and therefore the risk of forfeiture avoided.
Strategic Alternatives Update
The previously announced strategic alternatives process continues. The Company, along with its financial advisor, Evercore Group LLC, is in ongoing discussions with multiple potential counterparties. As indicated previously, there can be no assurance that any additional transactions will be consummated.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
About PAE
PAE is the largest private hydrocarbon producing company in Argentina. It contributes 18% of hydrocarbon produced in the country and has had the highest growth rate and the highest reserve replacement ratio in Argentina over the past 10 years. In 2016, PAE invested $1.4 billion, after having invested $13 billion between 2001 and 2015.
Over the past 14 years, PAE increased its oil production by 34% and gas production by 67%.
PAE employs more than 12,000 people either directly or indirectly and has a presence in the four major hydrocarbon producing basins in Argentina: Golfo San Jorge, with the largest oil production in Cerro Dragón, the largest oilfield in the country; Neuquina, the largest gas basin and the hub for the future development of unconventional reservoirs; Noroeste (province of Salta) and the Austral Basin (located offshore Tierra del Fuego), with significant production of gas, the main source of energy in the country.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to the transactions described herein, the associated work program, the use of proceeds from the transactions described herein and their impact on the Company's liquidity challenges and matters related to the strategic review. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
1/11/201712/21/2016 - Madalena Announces Sale of Point Loma Debenture
Madalena Announces Sale of Point Loma Debenture
Source: PR Newswire
(All dollar figures are expressed in United States Dollars, unless otherwise noted)
CALGARY, Dec. 20, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces that it has sold its CAD $3 million convertible debenture (the "Convertible Debenture") of Point Loma Resources Ltd. (TSXV: PLX) ("Point Loma") for cash proceeds of $522,000 (CAD $700,000). The Convertible Debenture was part of the consideration Madalena received when the non-core Canadian assets were sold effective May 1, 2016. The carrying value of the Convertible Debenture at September 30, 2016 was $1.9 million (CAD $2.6 million).
The balance of the consideration Madalena received for its Canadian assets was 6,244,814 common shares of Point Loma, 10% of which are currently free trading. The balance of the shares is escrowed and will be released at six month intervals commencing December 30, 2016. The carrying value of the Point Loma common shares at September 30, 2016 was $1.9 million (CAD $2.5 million).
The Company, as previously disclosed, has been experiencing liquidity challenges. The transaction at Coiron Amago Sur Este, which was announced on December 7, 2016, will, when closed, provide significant assistance to addressing the liquidity and working capital challenges the Company has been facing. Proceeds from the sale of the Convertible Debenture will also assist in this process.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to addressing the Corporation's liquidity challenges. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
SOURCE Madalena Energy Inc.
Article Date
12/21/2016Madalena announces a strategic transaction at Coiron Amargo Sur Este with Pan American Energy and a debt financing agreement
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States Dollars)
CALGARY, Dec. 7, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce that it has entered into agreements with Pan American Energy LLC, Sucursal Argentina ("PAE") relating to its 90% working interest ("WI") in the Coiron Amargo Sur Este ("CASE") block. Concurrent with this transaction, Madalena and PAE have entered into an agreement whereby PAE will provide a limited recourse loan to Madalena of up to $40 million, to be drawn-down as required to fund certain capital expenditures.
Transaction Highlights:
Payment
Madalena will receive a refundable deposit within two business days with the balance of the $10 million due upon closing, which is expected to occur within 90 days. Within that period, the parties must obtain the approvals of Gas y Petróleo del Neuquén Sociedad Anómina ("GyP") and the Province of Neuquén, Argentina.
Working Interests and Operatorship
PAE will become the operator at CASE, with resulting WI in the block as follows:
|
PAE |
55% | ||
|
Madalena |
35% | ||
|
GyP |
10% | ||
Work Program
The Work Program will consist of either two horizontal multi-frac completions in the Vaca Muerta shale formation or one horizontal multi-frac in the Vaca Muerta and one deep Grupo Cuyo sandstone gas test, utilizing existing cased wellbores on the block.
Loan
PAE has agreed to provide up to $40 million to Madalena to be drawn-down as required to fund certain capital expenditures. This limited recourse loan will bear interest at 7% per annum and is repayable in 5 years.
Benefits to Madalena
This transaction delivers a number of positives for the Company. It provides significant assistance to addressing the liquidity and working capital challenges which Madalena has been facing. As well, Madalena stands to benefit from its relationship with a well-established, experienced operator which will provide the necessary capital and expertise so that the CASE block can be efficiently developed.
Strategic Alternatives Update
The strategic alternatives process previously announced continues. The Company, along with its financial advisor, Evercore Group LLC, is in discussions with a number of parties who have expressed interest in other aspects of Madalena's operations. As indicated previously, there can be no assurance that such transactions will be consummated.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
About Pan American Energy
Pan American Energy is the largest private hydrocarbon producing company in Argentina. It contributes 18% of hydrocarbon produced in the country and has had the highest growth rate and the highest reserve replacement ratio in Argentina for the past 10 years. In 2016, the company will invest 1.4 billion dollars, after having invested 13 billion dollars between 2001 and 2015.
Over the past 14 years, the company increased its oil production by 34% and gas production by 67%.
PAE employs more than 12,000 people either directly or indirectly and has presence in the four major hydrocarbon producing basins in Argentina: Golfo San Jorge, with the largest oil production in Cerro Dragón, the largest oilfield in the country; Neuquina, the largest gas basin and the hub for the future development of unconventional reservoirs; Noroeste (province of Salta) and the Austral Basin (located offshore Tierra del Fuego), with significant production of gas, the main source of energy in the country.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to the transactions described herein, the associated Work Program and the strategic review. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
12/7/201611/23/2016 - Madalena Announces Q3 - 2016 Results
Madalena Announces Q3 - 2016 Results
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States dollars unless otherwise stated)
CALGARY, Nov. 22, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces its operating and financial results for the three and nine months ended September 30, 2016. Selected information is outlined below and should be read in conjunction with Madalena's unaudited condensed interim consolidated financial statements for the three and nine months ended September 30, 2016 and the associated management's discussion and analysis ("MD&A"), which are available for review under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com.
SUMMARY FINANCIAL AND OPERATIONAL RESULTS
|
Three months ended September 30 |
Nine months ended September 30 | |||
|
2016 |
2015 |
2016 |
2015 | |
|
Financial – ($000s, except per share amounts) |
||||
|
Oil and gas revenue |
11,728 |
20,816 |
39,609 |
63,824 |
|
Funds flow from continuing operations(1) |
840 |
15,959 |
5,821 |
25,369 |
|
Per share - basic & diluted(1) |
0.00 |
0.03 |
0.01 |
0.05 |
|
Net income (loss) from continuing operations |
(12,715) |
7,939 |
(22,697) |
6,345 |
|
Per share - basic & diluted(1) |
(0.02) |
0.01 |
(0.04) |
0.01 |
|
Capital expenditures |
622 |
14,453 |
6,008 |
28,257 |
|
Working capital (deficiency) |
(3,839) |
462 |
(3,839) |
462 |
|
Common shares outstanding - 000s |
543,780 |
541,000 |
543,780 |
541,000 |
|
Operating |
||||
|
Average Daily Sales |
||||
|
Crude oil and Ngls – Bbls/d |
1,853 |
2,705 |
2,114 |
2,817 |
|
Natural gas – Mcf/d |
2,368 |
3,843 |
2,659 |
4,064 |
|
Total - Boe /d |
2,247 |
3,346 |
2,557 |
3,494 |
|
Average Sales Prices |
||||
|
Crude oil and Ngls - $/Bbl |
61.65 |
75.76 |
62.10 |
75.81 |
|
Natural gas - $/Mcf |
5.60 |
5.54 |
4.99 |
4.98 |
|
Total - $/Boe |
56.72 |
67.62 |
56.53 |
66.91 |
|
Operating Netbacks(2) - $/Boe |
17.23 |
29.59 |
23.04 |
30.00 |
|
(1) |
This table contains the term "funds flow from continuing operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flows from operating activities " as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from operations and funds flow from operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from continuing operations to analyze operating performance and considers funds flow from continuing operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from continuing operations and cash flows from operating activities can be found in the MD&A. Funds flow from continuing operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(2) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
Crude oil and NGL sales volumes for the three months ended September 30, 2016 ("the Quarter" or "Q3-2016") decreased to 1,853 boe/d from 2,705 boe/d for the three months ended September 30, 2015 ("Q3-2015"). The change compared to Q3-2015, can be attributed to production declines at both Surubi and Rinconada - Puesto Morales. Natural gas sales volumes for the Quarter of 2,368 mcf/d, decreased compared to 3,843 mcf/d for Q3-2015 due to lower production at Rinconada - Puesto Morales and CA-Norte.
While the decrease at Rinconada - Puesto Morales was from natural declines, the Surubi decline was a function of a delay in remedial work. Subsequent to September 30, 2016, the remedial work program at Surubi commenced and is currently ongoing. The Company believes that the remedial work program will allow incremental production to be brought back on line.
While the Argentine government has not announced adjustments to regulated Medanito oil pricing, the Company was advised by the refineries to which it delivers its oil production that the oil price it will receive for November and December 2016 oil production will be reduced by approximately 30%, bringing prices to be received in those months in line with international levels. The Company is undertaking a review of its operating assets in order to determine the extent of the financial impact caused by lower oil prices. While this analysis is not complete, it is clear that the reduction in oil prices communicated to the Company by the refiners will have a significant negative impact.
As at September 30, 2016, the Company had a working capital deficit of approximately $3.8 million and continued to face significant liquidity challenges. Of that amount, approximately $2 million relates to overdue amounts payable to the operator at Coiron Amargo-Norte ("CA-Norte"). This payable is fully recorded as part of trade and other payables in the condensed interim consolidated statements of financial position at September 30, 2016.
Madalena has received a notice from this operator relating to Madalena's overdue payable and has been advised that Madalena's share of oil and gas sales are being applied against the outstanding payable. The Company is in discussions with the operator to satisfy the outstanding payable. Should the matter not be resolved prior to April 21, 2017, a potential outcome is the ultimate forfeiture of Madalena's working interest at CA-Norte.
Management in Canada and Argentina have been taking measures for some time now to reduce expenses and conserve cash. Office and field personnel have been reduced in both countries, office space has been downsized in Canada and other costs saving measures have been implemented wherever possible. Cash has been preserved by deferring the payment of amounts owed to directors and management fees owed to the Interim CEO of the Company. In addition, all capital spending has been limited or deferred.
Strategic Alternatives Update
The strategic alternatives process previously announced continues. The Company, along with its financial advisor, Evercore Group LLC, is actively involved in negotiations with a number of parties who have expressed interest in various transactions with Madalena. There can be no assurance that such transactions will be consummated.
Outlook
The current year-to-date losses, current working capital deficiency, the expectation of reduced near term cash flow resulting from lower oil prices in Argentina, as well as the capital commitments in 2016 and 2017 are expected to result in cash outflows that exceed anticipated future funds from operations. The Company continues to include a note of going concern uncertainty in the condensed interim consolidated financial statements. Without an infusion of capital and/or a successful outcome from the strategic alternatives process in the near term, Madalena may not be able to continue as a going concern.
About Madalena Energy
Madalena is an independent, Canadian headquartered Argentina upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, production levels, the strategic value and opportunities available to Madalena, operational and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities and the Company's ability to meet its commitments and continue as a going concern or continue operating at all. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
11/23/2016Madalena provides update with respect to Argentine oil pricing
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Nov. 17, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) has been advised by the refineries to which it delivers its oil production that the oil price it will receive for November and December oil production will be reduced by approximately 30%. Other producers have confirmed to the Company that they have been similarly advised. The Company received an average price per barrel during the third quarter of $61.65.
Madalena is assessing the impact of this price reduction on its business operations. However, one of the parties with whom the Company was in discussion regarding the sale of certain Madalena assets has now withdrawn from those discussions, citing this oil price reduction.
About Madalena Energy
Madalena is an independent, Canadian headquartered, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to matters related to commodity pricing and the strategic review. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
11/17/2016Madalena Announces Q2 - 2016 Results and a Review of Strategic Alternatives
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States dollars unless otherwise stated)
CALGARY, Aug. 23, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to provide its operating and financial results for the three and six months ended June 30, 2016. Selected information is outlined below and should be read in conjunction with Madalena's unaudited condensed interim consolidated financial statements for the three and six months ended June 30, 2016 and the associated management's discussion and analysis ("MD&A"), which are available for review under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com.
|
SUMMARY FINANCIAL AND OPERATIONAL RESULTS | ||||
|
Three months ended June 30 |
Six months ended June 30 | |||
|
2016 |
2015 |
2016 |
2015 | |
|
Financial – ($000s, except per share amounts) |
||||
|
Oil and gas revenue |
13,070 |
24,115 |
27,881 |
43,008 |
|
Funds flow from continuing operations(1) |
1,821 |
4,278 |
4,980 |
9,412 |
|
Per share - basic & diluted(1) |
0.00 |
0.01 |
0.01 |
0.02 |
|
Net loss from continuing operations |
(3,491) |
(3,209) |
(9,983) |
(2,143) |
|
Per share - basic & diluted(1) |
(0.00) |
(0.01) |
(0.02) |
(0.00) |
|
Capital expenditures |
525 |
2,418 |
5,386 |
13,804 |
|
Working capital |
(5,332) |
462 |
(5,332) |
462 |
|
Common shares outstanding - 000s |
542,083 |
541,000 |
542,083 |
541,000 |
|
Operating |
||||
|
Average Daily Sales |
||||
|
Crude oil and Ngls – Bbls/d |
2,084 |
3,092 |
2,246 |
2,873 |
|
Natural gas – Mcf/d |
2,636 |
4,455 |
2,806 |
4,176 |
|
Total - Boe /d |
2,523 |
3,834 |
2,714 |
3,569 |
|
Average Sales Prices |
||||
|
Crude oil and Ngls - $/Bbl |
62.41 |
78.36 |
62.29 |
75.83 |
|
Natural gas - $/Mcf |
5.15 |
5.11 |
4.73 |
4.72 |
|
Total - $/Boe |
56.93 |
69.11 |
56.45 |
66.57 |
|
Operating Netbacks(2) - $/Boe |
26.23 |
30.40 |
25.48 |
30.20 |
|
(1) |
This table contains the term "funds flow from continuing operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flows from operating activities " as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from operations and funds flow from operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from continuing operations to analyze operating performance and considers funds flow from continuing operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from continuing operations and cash flows from operating activities can be found in the MD&A. Funds flow from continuing operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(2) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
Review of Strategic Alternatives
Madalena has initiated a review of strategic alternatives. Evercore Group LLC ("Evercore"), which had been retained to assist in securing a joint venture partner for the Curamhuele block in Argentina, has had its mandate broadened to encompass this review of strategic alternatives. In part, the review was prompted by a number of unsolicited expressions of interest received by the Company after the May 16, 2016 news release announcing the initial engagement of Evercore. These strategic alternatives may include, among other things, asset sales, a merger, sale or recapitalization transaction, joint ventures or other opportunities.
The Company does not intend to provide updates on this process until such time as the Board of Directors deem it appropriate. There can be no guarantee that this review will result in a transaction(s), or if a transaction(s) is undertaken, as to its terms or timing.
About Madalena Energy
Madalena is an independent, Canadian head-quartered Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, production levels, the strategic value and opportunities available to Madalena, operational, business development and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities and the Company's ability to meet its commitments and continue as a going concern. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
8/24/2016Madalena Announces Board and Executive Changes and Shares for Debt Transaction
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, July 19, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces the departure of Mr. Ray Smith from the board of directors of the Company. Mr. Smith has been a director of Madalena for over 10 years and the board thanks him for his significant contributions to the Company.
Madalena also announces the departures of Mr. Stephen Kapusta, Vice President, Engineering and Mr. Robert Stanton, Vice President, Operations. Mr. Kapusta has resigned effective July 31, 2016 to pursue other opportunities. The departure of Mr. Stanton, who was previously responsible for Madalena's Canadian operations, is effective August 5, 2016 and is as a result of the sale of Madalena's Canadian assets. The Madalena board of directors and management thank Mr. Kapusta and Mr. Stanton for their contributions and wish each of them success in the future.
In addition, Madalena announces that it has entered into a settlement agreement with Mr. Kevin Shaw, former President and Chief Executive Officer of the Company, with respect to his departure from Madalena. Pursuant to such agreement, among other things, Madalena has agreed to issue 1,696,970 common shares of the Company at a deemed issue price of $0.165 per share, which decreases the severance contractually owed to Mr. Shaw by $280,000. Such share issuance is subject to the approval of the TSX Venture Exchange.
About Madalena Energy
Madalena is an independent, Canadian-based, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
7/20/2016Madalena enters into agreements to increase its ownership at Coirón Amargo Sur and reduce near-term work commitments
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States dollars unless otherwise stated)
CALGARY, July 11, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce that it has entered into definitive agreements to effect positive ownership changes to the Company's Coirón Amargo block, which will result in Madalena achieving two of the Company's important goals in Argentina – securing increased ownership and operatorship over one of the Company's key assets and reducing near-term work commitments.
Highlights of the transactions, which were accomplished without any cash consideration being paid by Madalena to any of the counterparties, are as follows:
Summary of the Ownership Changes
Madalena currently holds a 35% WI in the entire Coirón Amargo block. The block consists of an aggregate of approximately 100,000 gross acres (35,000 net) of Vaca Muerta and Sierras Blancas prospective acreage. The Coirón Amargo Norte exploitation concession consists of 26,598 gross acres (9,309 net) and the Coirón Amargo Sur evaluation concession consists of 72,738 acres (25,458 net).
Pursuant to a series of agreements dated July 11, 2016 involving Madalena, a subsidiary of Royal Dutch Shell plc ("Shell"), O&G Developments Ltd S.A. ("O&G"), ROCH S.A. ("Roch"), Apco Oil & Gas International Inc. (Sucursal Argentina) ("Apco"), which is a subsidiary of Pluspetrol Resources Corp. and Gas y Petróleo del Neuquén S.A. ("G&P"), the parties have agreed, subject to government approvals and an Executive Decree, to divide Coirón Amargo Sur into two evaluation lots – Coirón Amargo Sur Este and Coirón Amargo Sur Oeste. Madalena will assign its interest in Coirón Amargo Sur Oeste (5,754 net acres) to its counterparties. In return, Madalena will increase its WI to 90% at Coirón Amargo Sur Este, increasing its net acreage by 30,964 to 50,668 acres and become operator on this parcel. G&P will retain its 10% WI.
At Coirón Amargo Norte, Madalena will retain its 35% WI (9,309 net acres) and Apco will become the operator.
Benefits
These transactions will enable the Company to control future operations at Coirón Amargo Sur Este, reduce near-term work commitments and provide more flexibility in managing future commitments, all of which have been accomplished without any cash consideration being paid by Madalena to any of the counterparties. The previous work commitments at Coirón Amargo Sur were $17.5 million, which were required to be incurred by November 8, 2017. Pursuant to the new arrangements, Madalena will have the following work commitments at Coirón Amargo Sur Este:
(1) $5 million before November 8, 2017 to evaluate either the Vaca Muerta or tight gas commerciality; and
(2) an additional $5 million, subject to the results in (1) above, before November 8, 2019.
The new evaluation permit for Coirón Amargo Sur Este will expire on November 8, 2019, following which Madalena will be eligible to enter into an exploitation (development) concession.
Prior to this transaction, Madalena participated in the drilling of the following wells on what is now the Coirón Amargo Sur Este concession.
About Madalena Energy
Madalena is an independent, Canadian-based, Argentina focused upstream oil and gas company with operations in four provinces of Argentina where it is focused on the delineation of unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
An updated corporate presentation is available on the Company's website.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, matters related to the ownership changes referred to herein and the expected results and benefits therefrom. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Boes
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
7/12/20165/16/2016 - Madalena Announces Q1 - 2016 Results
Madalena Announces Q1 - 2016 Results
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
(All dollar figures are expressed in United States dollars unless otherwise stated)
CALGARY, May 16, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to provide its operating and financial results for the three months ended March 31, 2016. Selected information is outlined below and should be read in conjunction with Madalena's unaudited condensed interim consolidated financial statements for the three months ended March 31, 2016 and the associated management's discussion and analysis, which are available for review under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com. An updated corporate presentation is available on the Company's website.
SUMMARY FINANCIAL AND OPERATIONAL RESULTS
|
Three months ended March 31 | ||
|
2016 |
2015 | |
|
Financial – US Dollars ($000s, except per share amounts) |
||
|
Oil and gas revenue |
15,105 |
19,445 |
|
Funds flow from operations(1) |
2,963 |
4,720 |
|
Per share - basic & diluted(1) |
0.01 |
0.01 |
|
Net income (loss) |
(6,834) |
1,003 |
|
Per share – basic and diluted |
(0.01) |
0.00 |
|
Capital expenditures |
4,861 |
11,737 |
|
Working capital |
(3,329) |
462 |
|
Common shares outstanding - 000s |
542,083 |
540,300 |
|
Operating |
||
|
Average Daily Sales |
||
|
Crude oil and Ngls – Bbls/d |
2,545 |
2,801 |
|
Natural gas – Mcf/d |
3,180 |
4,710 |
|
Total - Boe /d |
3,075 |
3,586 |
|
Average Sales Prices |
||
|
Crude oil and Ngls - $/Bbl |
60.04 |
70.53 |
|
Natural gas - $/Mcf |
4.16 |
3.93 |
|
Total - $/Boe |
53.99 |
60.25 |
|
Operating Netbacks(2) - $/Boe |
22.96 |
26.73 |
|
(1) |
This table contains the term "funds flow from operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flows from operating activities" as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from operations and funds flow from operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from operations to analyze operating performance and considers funds flow from operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from operations and cash flows from operating activities can be found in "Management's Discussion and Analysis". Funds flow from operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(2) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
FIRST QUARTER 2016 HIGHLIGHTS
Sale of Non-Core Canadian Assets
On February 8, 2016, First Mountain Exploration Inc. ("First Mountain"), Point Loma Energy Ltd. ("Point Loma") and Madalena entered into a non-binding letter of intent pursuant to which, among other things, it is proposed that Point Loma will acquire Madalena's non-core Canadian oil and gas assets for a deemed aggregate purchase price of approximately $4.0 million (CAD $5.5 million).
Proceeds to the Company will consist of 14,522,823 common shares of Point Loma, with a deemed value of $1.8 million (CAD $2.5 million), as well as a five-year $2.2 million (CAD $3 million) secured convertible debenture, bearing interest at 3% per annum, payable at the end of the debenture term. The effective date is May 1, 2016, with closing expected in early June 2016, subject to certain terms and conditions, including the successful acquisition (the "Acquisition") of Point Loma by First Mountain. The Acquisition will involve an exchange of publicly traded First Mountain common shares (TSXV: FMX) for all of the outstanding common shares of Point Loma including those received by Madalena.
Advisor Retained for JV Partner for Curamhuele
The Company has recently retained Evercore Group LLC as its exclusive financial advisor in connection with identifying and securing a joint venture partner for the 90% working interest Curamhuele block in Argentina to accelerate exploration and development activities on the block. In addition, the Company is actively marketing certain of its non-core properties in Argentina.
Operations Update
During the first quarter, the Company completed the Yapai.x-1001 well on its exploration block at Curamhuele targeting the Lower Agrio shale. Over an 80 day period, the well has produced 6,160 bbls oil (77 bopd), 7,645 bbls water (95 bbls/d) representing approximately 56% of the frac load fluid and 7.0 MMcf gas (88 mcf/d). All solution gas is being flared. The well has been flowing up five inch casing and was shut-in on May 10, 2016 for a pressure build-up test.
OUTLOOK
There have been a number of economic changes in Argentina over the last six months. These changes include the election of a new president, the subsequent Argentina peso devaluation, the lifting of foreign currency controls, a 10% reduction in early 2016 for Medanito crude quality oil from $75.00 to $67.50 and the settlement of the 2001 Argentina government defaulted bonds with the bondholders.
Although the Company has a largely unleveraged balance sheet at March 31, 2016, it does have a working capital deficit of $3.3 million, and continues to face liquidity challenges. The Company is actively pursuing alternative sources of capital, including potential debt and equity financing and ways to monetize its assets, including, without limitation, asset sales or swaps, joint ventures or other transactions with industry partners, all with a view to enhancing liquidity to execute on its business plan.
Capital commitments in 2016 and 2017 are expected to exceed anticipated future funds flow from operations and, accordingly, the Company has included a note on going concern uncertainty in the condensed interim consolidated financial statements. In the event the Company cannot access the required funding and certain work commitments are not fulfilled prior to the commitment deadlines, the Company will attempt to extend its commitments with the regulators. There is no certainty that any extensions will occur in the future and failure to obtain such extensions may result in the loss of concessions and the rights attached to them.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, production levels, the strategic value and opportunities available to Madalena, operational, business development and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities and the Company's ability to meet its commitments and continue as a going concern. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Initial Production Rates
Any references in this document to test rates, flow rates, initial and/or final raw test or production rates, early production, and/or "flush" production rates are useful in confirming the presence of hydrocarbons, however, such rates are not necessarily indicative of long-term performance or of ultimate recovery. Such rates may also include recovered "load" or "frac" fluids used in well completion stimulation. Readers are cautioned not to place reliance on such rates in calculating the aggregate production for Madalena. In addition, certain Madalena properties are unconventional resource plays which may be subject to high initial decline rates. Such rates may be estimated based on other third party estimates or limited data available at this time and are not determinative of the rates at which such wells will continue production and decline thereafter.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
5/16/2016Madalena Announces Fourth Quarter and Year End 2015 Financial Results and Provides Operations Update and 2016 Outlook
Source: PR Newswire
CALGARY, April 21, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to provide selected financial and operational information for the three months and year ended December 31, 2015.
Copies of the Company's consolidated financial statements for the year ended December 31, 2015, the related management's discussion and analysis and the Annual Information Form (the "AIF") of the Company have been filed with Canadian securities regulatory authorities and will be made available under the Company's profile at www.sedar.com and on the Company's website at www.madalenaenergy.com. All dollar figures are expressed in United States dollars unless otherwise stated. Prior year figures were previously reported in Canadian dollars and have been translated for comparative purposes as disclosed in the notes to the consolidated financial statements.
An updated corporate presentation is available on the Company's website.
2015 HIGHLIGHTS
Highlights for 2015 included:
SUMMARY FINANCIAL AND OPERATIONAL RESULTS
|
Three months ended December 31 |
Year ended December 31 | |||
|
2015 |
2014 |
2015 |
2014 | |
|
Financial – US Dollars ($000s, except per share amounts) |
||||
|
Gross revenue(1) |
18,304 |
23,446 |
97,505 |
65,873 |
|
Funds flow from operations(2) |
3,693 |
3,918 |
27,801 |
16,475 |
|
Per share - basic & diluted(2) |
0.01 |
0.01 |
0.05 |
0.04 |
|
Net loss(3) |
(13,761) |
(28,273) |
(13,705) |
(31,832) |
|
Per share – basic and diluted(3) |
(0.03) |
(0.05) |
(0.03) |
(0.07) |
|
Capital expenditures |
12,707 |
11,542 |
41,417 |
36,105 |
|
Working capital |
462 |
10,151 |
462 |
10,151 |
|
Equity outstanding – 000s |
||||
|
Common shares |
542,083 |
539,782 |
542,083 |
539,782 |
|
Stock options |
34,819 |
25,880 |
34,819 |
25,880 |
|
Operating |
||||
|
Average Daily Sales |
||||
|
Crude oil and Ngls – Bbls/d |
2,671 |
2,991 |
2,880 |
2,035 |
|
Natural gas – Mcf/d |
3,614 |
6,505 |
4,187 |
5,083 |
|
Total - boe /d |
3,274 |
4,075 |
3,577 |
2,883 |
|
Average Sales Prices |
||||
|
Crude oil and Ngls - $/Bbl |
68.88 |
77.01 |
72.83 |
77.38 |
|
Natural gas - $/Mcf |
4.14 |
3.97 |
4.64 |
4.58 |
|
Total - $/boe |
60.77 |
62.85 |
64.06 |
62.72 |
|
Corporate Operating Netbacks(4) |
||||
|
$/boe |
21.07 |
23.54 |
26.07 |
28.33 |
|
(1) |
The year-end balance includes other income of $13.9 million pursuant to the one-time settlement of the past Petroleo Plus incentive credits and $2.9 million in oil incentive credit, $0.7 million of which was recorded in Q4- 2015. |
|
(2) |
This table contains the term "funds flow from operations", which is a non-GAAP measure and should not be considered an alternative to, or more meaningful than "cash flows from operating activities" as determined in accordance with International Financial Reporting Standards ("IFRS") as an indicator of the Company's performance. Funds flow from operations and funds flow from operations per share (basic and diluted) do not have any standardized meanings prescribed by IFRS and may not be comparable with the calculation of similar measures for other entities. Management uses funds flow from operations to analyze operating performance and considers funds flow from operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investment. The reconciliation between funds flow from operations and cash flows from operating activities can be found in "Management's Discussion and Analysis". Funds flow from operations per share is calculated using the basic and diluted weighted average number of shares for the period, consistent with the calculations of earnings (loss) per share. |
|
(3) |
Includes a pre-tax impairment charge on the Canadian assets in the amount of $1.3 million for the three months ended December 31, 2015 (Q4 -2014 - $24.1 million) and $5.4 million for the year ended December 31, 2015 (2014 - $26.9 million). Includes a pre-tax impairment charge on the Argentine assets in the amount of $8.4 million for the three months and year ended December 31, 2015. There was no impairment on the Argentine assets in 2014. |
|
(4) |
Operating netback is a non-GAAP measure calculated as the average per boe of the Company's oil and gas sales, less royalties and operating costs. |
ADVISOR RETAINED FOR CURAMHUELE
The Company has recently retained Evercore Group LLC as its exclusive financial advisor in connection with identifying and securing a joint venture partner for the Curamhuele block in Argentina to accelerate exploration and development activities on the block.
In addition, the Company is actively marketing certain of its other properties in Argentina with a view to enhance liquidity and meet commitments.
CANADA OPERATIONS UPDATE
On February 8, 2016, First Mountain Exploration Inc. ("First Mountain"), Point Loma Energy Ltd. ("Point Loma") and Madalena entered into a non-binding letter of intent pursuant to which, among other things, it is proposed that Point Loma will acquire Madalena's non-core Canadian oil and gas assets for a deemed aggregate purchase price of approximately $4.0 million (CAD $5.5 million).
It is anticipated that the Company will sign the asset purchase and sale agreement ("PSA") within the next two weeks. Proceeds will consist of 14,522,823 common shares of Point Loma, with a deemed value of $1.8 million (CAD $2.5 million), as well as a five-year $2.2 million (CAD $3 million) secured convertible debenture, bearing interest at 3% per annum, payable at the end of the debenture term. The effective date of this PSA is expected to be May 1, 2016, with closing expected on or about May 31, 2016, subject to certain terms and conditions, including the completion of a financing by the purchaser, as well as the successful acquisition (the "Acquisition") of Point Loma by First Mountain. The Acquisition will involve an exchange of publicly traded First Mountain common shares (TSXV: FMX) for all of the outstanding common shares of Point Loma including those received by Madalena as proceeds of the PSA.
ARGENTINA OPERATIONS UPDATE
Subsequent to the year-end, the Company fulfilled its remaining work obligation at Curamhuele by completing the Yapai.x-1001 well. Over a 55 day period, the well has produced 5,338 bbls oil (97 bopd), 7,311 bbls water (133 bbls/d) representing approximately 53% of the frac load fluid and 6.1 MMcf gas (110 mcf/d). The well has been flowing up five inch casing and the Company is currently evaluating equipping the well with tubing and artificial lift (pumping unit) to optimize production and further test the potential of the well.
Madalena expects Q1 - 2016 sales volumes to average approximately 3,000 boe/d.
2016 OUTLOOK
The current macro-economic outlook in Argentina is increasingly positive. The recently elected government has implemented changes that are expected to revitalize Argentina's economy, attract foreign investment and enable the country to gain access to international credit markets.
The Company exited 2015 with a largely unleveraged balance sheet - positive working capital of $0.5 million and a before tax, NPV10 proved plus probable reserves value of $127.2 million, with $2.0 of long-term bank debt and $1.6 million of other long-term liabilities. However, during 2015 and to date in 2016, the Company has been unable to access additional capital on terms acceptable to the Company, which is required for liquidity purposes and to fund commitments on the Company's blocks in Argentina. The current world-wide economic environment relating to the oil and gas industry has made access to capital challenging for many companies, Madalena included. This has resulted in liquidity challenges and unless the Company is able to raise additional capital or renegotiate its commitments, it does not expect that forecasted cash flows from operating activities will be sufficient to meet its anticipated 2016 and 2017 capital commitments. The Company is examining alternative sources of capital, including potential debt and equity financing and ways to monetize its assets, including, without limitation, asset sales or swaps, joint ventures or other transactions with industry partners, all with a view to enhancing liquidity and meeting commitments. The need to raise capital or defer expenditures to fund its anticipated 2016 and 2017 capital commitments creates uncertainty that may cast doubt over the Company's ability to continue as a going concern.
While the Company continues to actively investigate alternative sources of capital and opportunities to extend its drilling commitments to address these liquidity challenges and fulfill its commitments, until these issues are resolved, the Company will not be in a position to provide guidance on its 2016 capital program.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil plays. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, but not limited to, with respect to the characteristics of the properties held by the Company, production levels, the strategic value and opportunities available to Madalena, operational, business development and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities and the Company's ability to meet its commitments and continue as a going concern. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Analogous Information
Certain information in this news release may constitute "analogous information" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"), including, but not limited to, information relating to areas, assets, wells and/or operations that are in geographical proximity to or believed to be on-trend with lands held by Madalena. Such information has been obtained from public sources, government sources, regulatory agencies or other industry participants. Management of Madalena believes the information may be relevant to help define the reservoir characteristics within lands on which Madalena holds an interest and such information has been presented to help demonstrate the basis for Madalena's business plans and strategies. However, management cannot confirm whether such analogous information has been prepared in accordance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and Madalena is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor. Madalena has no way of verifying the accuracy of such information. There is no certainty that the results of the analogous information or inferred thereby will be achieved by Madalena and such information should not be construed as an estimate of future production levels or the actual characteristics and quality Madalena's assets. Such information is also not an estimate of the reserves or resources attributable to lands held or to be held by Madalena and there is no certainty that such information will prove to be analogous in the future. The reader is cautioned that the data relied upon by Madalena may be in error and/or may not be analogous to such lands to be held by Madalena.
Initial Production Rates
Any references in this document to test rates, flow rates, initial and/or final raw test or production rates, early production, and/or "flush" production rates are useful in confirming the presence of hydrocarbons, however, such rates are not necessarily indicative of long-term performance or of ultimate recovery. Such rates may also include recovered "load" or "frac" fluids used in well completion stimulation. Readers are cautioned not to place reliance on such rates in calculating the aggregate production for Madalena. In addition, certain Madalena properties are unconventional resource plays which may be subject to high initial decline rates. Such rates may be estimated based on other third party estimates or limited data available at this time and are not determinative of the rates at which such wells will continue production and decline thereafter.
Drilling Locations
This press release refers to unbooked drilling locations. Unbooked locations are internal estimates based on Madalena's prospective acreage and an assumption as to the number of wells that can be drilled per section based on industry practice and internal review. Unbooked locations do not have attributed reserves. Unbooked locations have been identified by management as an estimation of our future drilling activities based on evaluation of applicable geologic, seismic, engineering, production and reserves information. There is no certainty that Madalena will drill all unbooked drilling locations and if drilled there is no certainty that such locations will result in additional oil and gas reserves or production. The drilling locations on which we actually drill wells will ultimately depend upon the availability of capital, regulatory approvals, access restrictions, oil and natural gas prices, costs, actual drilling results, additional reservoir information that is obtained and other factors. While certain of the unbooked drilling locations have been derisked by drilling existing wells in relative close proximity to such unbooked drilling locations, some of other unbooked drilling locations are farther away from existing wells where management has less information about the characteristics of the reservoir and therefore there is more uncertainty whether wells will be drilled in such locations and if drilled there is more uncertainty that such wells will result in additional oil and gas reserves or production.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
4/21/2016Madalena Energy Inc. announces executive and board changes
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, March 24, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) announces the departure of Kevin Shaw as President and Chief Executive Officer of the Company. The Madalena board of directors (the "Board") thanks Mr. Shaw for his contributions to the Company and wishes him success in the future.
Steven Sharpe, Chairman of the Board, has been appointed Interim President and Chief Executive Officer and will direct the ultimate search for a permanent CEO.
Madalena is pleased to announce the appointment of Eric Mark to the Board effective immediately.
Mr. Mark, an independent director, is currently a Managing Director at Batuta Capital Advisors ("Batuta"), a merchant bank targeting middle market and special situation opportunities in both the public and private markets. Batuta specializes in turnarounds, bankruptcies and distressed opportunities across the capital structure. Prior to joining Batuta, Mr. Mark was a Senior Analyst/Junior Portfolio Manager at BTG Pactual ("BTG"), a Brazilian investment bank, co-managing a $2 billion portfolio of distressed, high yield and special situation equities. During such time, Mr. Mark led official and ad hoc restructuring committees and advised BTG investment bankers in the restructuring of several South American companies, including OGX, SMU and Nextel International. Mr. Mark is experienced in investment analysis (credit and equity) in the energy, metals & mining, general industrials and telecommunications sectors across North America, South America and Europe.
Mr. Mark received a BA in economics and French literature and an MA in economics from Indiana University in 1990 and 1993, respectively, and during such time Mr. Mark completed PhD course-work in mathematical economics, international economics and development economics. In 1997, Mr. Mark received his MBA from the University of Chicago with concentrations in finance, international business and statistics.
With Mr. Mark's background and skills, Madalena believes that Mr. Mark will be a valuable contributor to the Board and Madalena.
About Madalena Energy
Madalena is an independent, Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale and Loma Montosa oil play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
3/24/2016Madalena Recognized as a 2016 TSX Venture 50® Company
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Feb. 25, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce it has been recognized as a 2016 TSX Venture 50® company.
Kevin Shaw, President and CEO, commented:
"Achieving a top tier ranking on the TSX Venture 50® is a great honour and recognition for Madalena. The Company would like to acknowledge the support of our shareholders as we continue to grow our Argentina energy business and strategically execute to unlock value from our unconventional shale and scalable resource plays."
The TSX Venture 50® is an annual ranking of the top 10 companies listed on the TSX Venture Exchange in each of the five major industry sectors: Mining, Oil & Gas, Clean Technology & Life Sciences, Diversified Industries, and Technology – based on a ranking with equal weighting given to return on investment, market capitalization growth, trading volume and analyst coverage. All data was as of December 31, 2015. Madalena was selected in the Oil & Gas Sector.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
2/25/2016Madalena announces year end reserves and resources
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Feb. 22, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce the results of its independent reserve reports as at December 31, 2015.
On February 9, 2016, the Company announced the proposed sale of its non-core Canadian properties. The reserves for the Canadian properties are included for reference but the majority of the discussion and analysis in this news release is focused on the Company's core business in Argentina, where Madalena holds over 950,000 net acres across 12 blocks.
Year End 2015 Reserves Highlights:
Highlights of the Independent Resource Evaluation:
As disclosed in a news release dated November 4, 2015, the Company completed an independent assessment of its Contingent and Prospective Resources effective September 30, 2015, the results of which are summarized below:
The resource reports were prepared by Ryder Scott Company L.P. and GLJ Petroleum Consultants, independent qualified reserves evaluators, with an effective date of September 30, 2015 and in accordance with the National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook"). Readers are directed to the November 4, 2015 news release for additional details on the resource reports, including, without limitation, classifications of the most specific category of resources other than reserves in accordance with NI 51-101 and for the definitions of the various resource categories used herein.
The December 31, 2015 reserve report now includes 0.8 MMBOE of tight oil Probable Reserves related to the Vaca Muerta at Coiron Amargo.
There are no Proven or Probable reserves assigned to the Company's February 16, 2016 announced sweet light oil Lower Agrio shale discovery at Curamhuele.
The reserve reports were prepared in accordance with the definitions, standards and procedures contained in NI 51-101 and the COGE Handbook by McDaniel & Associates Consultants Ltd. ("McDaniel Report") for Canada and GLJ Petroleum Consultants ("GLJ Report") for Argentina. The McDaniel Report and GLJ Report contain several cautionary statements that are required by NI 51-101 and the reserves information presented is subject to the contents of the full reports. Additional information on the Company's reserves, as required by NI 51-101, will be filed prior to April 30, 2016 on SEDAR (www.sedar.com). The following tables summarize the Company's reserve information as set out in the McDaniel Report and the GLJ Report:
Reserves Summary – Company working interest before royalties using forecasted prices as at December 31, 2015.
|
Light and |
||||
|
Medium Oil |
NGL's |
Gas |
BOE 6:1 | |
|
Mbbl |
Mbbl |
MMcf |
Mboe | |
|
CANADA |
||||
|
Proven Developed Producing |
113 |
17 |
344 |
187 |
|
Proven Developed Non Producing |
120 |
53 |
1,311 |
391 |
|
Total Proven Developed |
232 |
70 |
1,655 |
578 |
|
Proven Undeveloped |
- |
- |
- |
- |
|
Total Proved |
232 |
70 |
1,655 |
578 |
|
Probable |
325 |
248 |
6,485 |
1,654 |
|
Total Proved + Probable |
557 |
318 |
8,140 |
2,232 |
|
ARGENTINA |
||||
|
Proven Developed Producing |
2,867 |
47 |
2,301 |
3,298 |
|
Proven Developed Non Producing |
525 |
1 |
186 |
557 |
|
Total Proven Developed |
3,392 |
48 |
2,487 |
3,855 |
|
Proven Undeveloped |
1,448 |
3 |
716 |
1,570 |
|
Total Proved |
4,840 |
51 |
3,203 |
5,425 |
|
Probable |
3,082 |
39 |
3,528 |
3,709 |
|
Total Proved + Probable |
7,922 |
90 |
6,731 |
9,134 |
|
CONSOLIDATED |
||||
|
Proven Developed Producing |
2,980 |
64 |
2,645 |
3,485 |
|
Proven Developed Non Producing |
645 |
54 |
1,497 |
948 |
|
Total Proven Developed |
3,625 |
118 |
4,142 |
4,433 |
|
Proven Undeveloped |
1,448 |
3 |
716 |
1,570 |
|
Total Proved |
5,073 |
121 |
4,858 |
6,003 |
|
Probable |
3,407 |
287 |
10,013 |
5,363 |
|
Total Proved + Probable |
8,480 |
408 |
14,871 |
11,366 |
Strong growth in Argentina reserves was offset by a reduction in Canadian reserves due primarily to economic factors.
The majority of the Proven Undeveloped reserves in Argentina are attributed to two (0.7 net) Sierras Blancas (light oil) conventional horizontal wells at Coiron Amargo and six (100% working interest) horizontal multi frac wells in the Loma Montosa resource play (light oil) at Puesto Morales. The remaining Proven Undeveloped and Proven Developed Non-producing reserves are from various recompletion projects at Coiron Amargo, Puesto Morales and Surubi in Argentina.
Probable reserves are attributed to six additional (100% working interest) horizontal multi frac wells at Puesto Morales in the Loma Montosa resource play (light oil) and three (1.05 net) wells at Coiron Amargo for Vaca Muerta shale (oil) horizontal multi frac re-entries. The Company and its partners intend to drill and complete a Vaca Muerta horizontal multi frac well at Coiron Amargo in 2016.
Summary of Net Present Values of Future Net Revenue(1)
Forecasted Prices and Costs(2)
Before Income Taxes, Discounted at (%/year)
|
As at December 31, 2015 | |||
|
0% |
10% |
15% | |
|
M$ |
M$ |
M$ | |
|
CANADA |
|||
|
Proven Developed Producing |
236 |
424 |
446 |
|
Proven Developed Non Producing |
1,983 |
1,525 |
1,318 |
|
Total Proven Developed |
2,219 |
1,949 |
1,764 |
|
Proven Undeveloped |
- |
- |
- |
|
Total Proved |
2,219 |
1,949 |
1,764 |
|
Probable |
8,523 |
2,450 |
796 |
|
Total Proved + Probable |
10,742 |
4,399 |
2,560 |
|
ARGENTINA |
|||
|
Proven Developed Producing |
78,651 |
68,264 |
63,304 |
|
Proven Developed Non Producing |
23,229 |
15,567 |
13,049 |
|
Total Proven Developed |
101,880 |
83,831 |
76,353 |
|
Proven Undeveloped |
40,353 |
17,696 |
11,147 |
|
Total Proved |
142,233 |
101,527 |
87,500 |
|
Probable |
134,159 |
70,054 |
52,984 |
|
Total Proved + Probable |
276,392 |
171,581 |
140,484 |
|
CONSOLIDATED |
|||
|
Proven Developed Producing |
78,887 |
68,688 |
63,750 |
|
Proven Developed Non Producing |
25,212 |
17,092 |
14,367 |
|
Total Proven Developed |
104,099 |
85,780 |
78,117 |
|
Proven Undeveloped |
40,353 |
17,696 |
11,147 |
|
Total Proved |
144,452 |
103,476 |
89,264 |
|
Probable |
142,682 |
72,503 |
53,780 |
|
Total Proved + Probable |
287,134 |
175,980 |
143,044 |
|
1) |
It should not be assumed that the present value of estimated future net cash flows shown above are representative of the fair market value of the reserves. |
|
2) |
Based on McDaniel's forecasted prices for Canada and GLJ's forecasted prices for Argentina as of January 1, 2016. |
|
3) |
GLJ Report for Argentina was completed in US$ and has been converted to Canadian dollars based on the December 31, 2015 exchange rate of 1 CDN: 0.7225 US. |
|
4) |
Tables may not add due to rounding. |
The Argentina 2P NPV 10% declined slightly (7%) from last year's 185 MM$ due to limited new drilling activity and a 13% decline in forecasted future oil prices in Argentina. The positive results from the wells drilled in Argentina in 2015 was the main factor for the increase in 2P reserves which offset most of the decline in forecasted future oil prices. Approximately 66% of the 1P NPV 10% is Developed Producing. Total Proved represents 59% of the 2P NPV 10%.
Summary of Forecasted Prices
The following table summarizes the forecasted benchmark prices for the McDaniel Report (Edmonton Light and Alberta AECO) and GLJ Report (Brent, Argentina crude and gas) as at December 31, 2015.
|
Edmonton |
Alberta |
Brent |
Argentina |
Argentina | |
|
Light |
AECO CDN$ |
Crude |
Crude |
Gas US$ | |
|
CDN$/bbl |
per mmbtu |
US$/bbl |
US$/bbl |
per mmbtu | |
|
2016 |
56.60 |
2.70 |
45.00 |
67.50 |
4.50 |
|
2017 |
66.40 |
3.20 |
54.00 |
67.50 |
4.50 |
|
2018 |
72.80 |
3.55 |
61.00 |
67.50 |
4.59 |
|
2019 |
80.90 |
3.85 |
67.00 |
67.50 |
4.68 |
|
2020 |
83.20 |
3.95 |
73.00 |
67.50 |
4.78 |
|
2021 |
88.20 |
4.20 |
78.00 |
69.10 |
4.87 |
|
2022 |
93.30 |
4.45 |
83.00 |
73.85 |
4.97 |
|
2023 |
98.70 |
4.70 |
88.00 |
78.60 |
5.07 |
|
2024 |
100.70 |
4.80 |
91.39 |
81.82 |
5.17 |
|
2025 |
102.60 |
4.90 |
93.22 |
83.56 |
5.27 |
|
2026 |
104.70 |
5.00 |
95.08 |
85.23 |
5.38 |
|
thereafter |
+ 2%/yr |
+ 2%/yr |
+ 2%/yr |
+ 2%/yr |
+ 2%/yr |
Summary of Reserves and Resources
Proved plus Probable reserves, Best Estimate Contingent Resources and Best Estimate Prospective Resources, as set out in the independent evaluations described herein and in the Company's November 4, 2015 news release, expressed in MMBoe are illustrated here.
Please see the Company's November 4, 2016 news release for additional important information related to its resources.
Argentina Reserves Reconciliation
|
Proved |
Proved + Probable | |||||
|
Mstb |
MMcf |
MBOE |
Mstb |
MMcf |
MBOE | |
|
Opening Reserves |
4,463 |
4,131 |
5,152 |
7,071 |
8,459 |
8,480 |
|
Production |
(1,003) |
(1,415) |
(1,239) |
(1,003) |
(1,415) |
(1,240) |
|
Acquisition |
- |
- |
- |
- |
- |
- |
|
Additions |
800 |
189 |
832 |
1,817 |
258 |
1,860 |
|
Revisions |
631 |
298 |
681 |
129 |
(570) |
34 |
|
Closing |
4,891 |
3,203 |
5,425 |
8,013 |
6,732 |
9,134 |
|
Reserve Replacement Ratio |
122% |
153% | ||||
|
1) |
Tables may not add due to rounding. |
|
2) |
Reserve Replacement Ratio is calculated as total reserve additions net of revisions (including acquisitions net of dispositions) divided by annual production. Madalena's Argentina production averaged 3,394 Boe/d in 2015. |
Positive revisions (13%) on the Proved reserves were the result of better performance on the Surubi property and higher per well reserve bookings for the Loma Montosa undeveloped wells at Puesto Morales, partially offset by minor negative revisions at Coiron Amargo. Proved plus Probable reserve revisions were less than 0.5% as negative gas revisions at Puesto Morales due to high fuel gas usage was offset by positive oil revisions on other properties. In 2015, the Company participated in four wells (2.7 net) at 100% success rate. Reserve additions come primarily from new wells at Puesto Morales and Vaca Muerta shale horizontals at Coiron Amargo. Although the Curamhuele well was drilled in 2015 and the capital was spent in 2015, there were no reserves assigned in the reserve report for the Lower Agrio shale since the well test, on the recently announced oil exploration discovery, occurred after December 31, 2015.
Future Development Capital and Drilling Inventory
The following table summarizes the Future Development Capital ("FDC") and the year over year change in the FDC for the Company's Argentina properties for the 1P and 2P reserves in the GLJ Report:
|
Proved US MM$ |
Proved plus Probable US MM$ | |||
|
Undiscounted |
Discounted 10% |
Undiscounted |
Discounted 10% | |
|
2014 |
32.4 |
26.9 |
69.0 |
61.7 |
|
2015 |
43.2 |
37.7 |
92.7 |
79.4 |
|
Change |
10.8 |
10.8 |
23.7 |
17.7 |
The Company anticipates it can lower the FDC per well for all of its operations in Argentina as the country has recently reduced import restrictions allowing for better and more competitive access to services and due to economies of scale as the operation shifts to development drilling. Madalena will continue to implement North American drilling and completion techniques which are also expected to result in improved efficiency and reduced costs.
Given the nature of the resource plays (conventional and unconventional), the Company has a large inventory of drilling locations. The following table summarizes the drilling inventory that is contemplated in the GLJ Report as well as the Company's current unbooked locations for select Argentina properties:
|
Proved |
Proved + Probable |
Unbooked |
Unbooked | |
|
Net Wells |
Net Wells |
Gross Wells |
Net Wells | |
|
Coiron Seirras Blancas |
0.7 |
0.7 |
4 |
1 |
|
Coiron Vaca Muerta |
1.1 |
514 |
180 | |
|
Puesto Morales |
6.0 |
12.0 |
36 |
36 |
|
Other |
0.9 |
6 |
6 | |
|
Curamhuele Lower Agrio |
570 |
513 | ||
|
Curamhuele Vaca Muerta |
150 |
135 | ||
|
Total |
6.7 |
14.7 |
1,280 |
871 |
|
1) |
See Reader Advisory at the end of this release for a discussion on Unbooked locations. |
|
2) |
Unbooked locations for Coiron Amargo Vaca Muerta are based on the GLJ Resource Report effective September 30, 2015 and represent four Hz multi frac wells every 640 acres in the mapped area. |
|
3) |
Unbooked locations for Curamhuele Lower Agrio are based on the GLJ Resource Report effective September 30, 2015 and represent eight Hz multi frac wells every 640 acres in the mapped area. |
|
4) |
Unbooked locations for Curamhuele Vaca Muerta are based on the Ryder Scott Resource Report effective September 30, 2015 and are based on an initial scoping study of 150 Hz multi frac wells. |
|
5) |
Unbooked locations for Puesto Morales are based on Madalena's management mapped primary targets reflecting four Hz multi frac wells every 160 acres. |
Oil and Gas Pricing Update
Oil prices in the regulated domestic market in Argentina remain strong and above the Brent oil benchmark price. The Medanito posted price for the Company's Argentina oil production is currently US$ 67.50/Bbl.
Natural Gas is also contracted until April 30 (end of Argentina summer) at US$ 4.20/MMbtu. The Company anticipates entering into a winter contract (May to October) in Argentina at a price of US$ 5.20/MMbtu or higher based on last year's winter gas contract.
Health, Safety, Environment ("HSE") and Corporate Social Responsibility ("CSR")
Madalena has a comprehensive HSE management plan for its employees and all contractors. In 2015 the Company continued to see major improvements in its key performance benchmarking indicators. For the 625,000+ person hours worked, there was only one lost time incident for a contractor involved in a service rig operation. Also, in 2015 the Company recorded only one minor spill by a contractor trucking fluid on behalf of Madalena. The spill was promptly cleaned up with new contractor procedures implemented to prevent similar incidents from taking place in the future.
The Company is most proud of its CSR initiatives in Argentina. The Company is actively involved in supporting the communities in which it operates, through a number of initiatives including local employment programs, access to health care and improvement in the quality of services, education, water quality and technical assistance on sustainable agricultural production. In 2015 the Company was asked by the local authorities to share its CSR plans and help other area operators achieve similar results.
Conference Call for Interested Parties
Madalena will host a conference call to discuss the updated reserves report on Tuesday February 23, 2016 at 9:00 am MST (11:00 am EST). To participate in the conference call, please call:
1-888-390-0546 (toll free North America)
1-416-764-8688 (Toronto & International)
Conference ID: 19277837
An updated corporate presentation will be placed on the Company's website.
About Madalena Energy
Madalena is an independent, Argentina focused, upstream oil and gas company.
Madalena holds over 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, and disclosure with respect to reserves or resources is deemed to be forward-looking statements. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. In particular, this news release contains forward-looking statements pertaining to operational activities to be conducted by the Company and the expected characteristics of such properties, including, without limitation, the reserves associated therewith. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Analogous Information
Certain information in this news release may constitute "analogous information" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"), including, but not limited to, information relating to areas, assets, wells and/or operations that are in geographical proximity to or believed to be on-trend with lands held by Madalena. Such information has been obtained from public sources, government sources, regulatory agencies or other industry participants. Management of Madalena believes the information may be relevant to help define the reservoir characteristics within lands on which Madalena holds an interest and such information has been presented to help demonstrate the basis for Madalena's business plans and strategies. However, management cannot confirm whether such analogous information has been prepared in accordance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and Madalena is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor. Madalena has no way of verifying the accuracy of such information. There is no certainty that the results of the analogous information or inferred thereby will be achieved by Madalena and such information should not be construed as an estimate of future production levels or the actual characteristics and quality Madalena's assets. Such information is also not an estimate of the reserves or resources attributable to lands held or to be held by Madalena and there is no certainty that such information will prove to be analogous in the future. The reader is cautioned that the data relied upon by Madalena may be in error and/or may not be analogous to such lands to be held by Madalena.
Notes to Disclosure of Resources and Reserves
Volumes of reserves and resources have been presented based on a company interest basis which includes Madalena's royalty interests without deducting royalties payable by the Company. Certain volumes are arithmetic sums of multiple estimates of Contingent and Prospective Resources, which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class as explained herein. The estimates of reserves and resources for individual properties may not reflect the same confidence level as estimates of reserves and resources for all properties, due to the effects of aggregation.
Unbooked Drilling Locations
Unbooked locations as disclosed herein have been identified by for the purposes of estimating Contingent Resources and have been identified based on evaluation of applicable geologic, seismic and engineering information. There is no certainty that the Company will drill all unbooked drilling locations and if drilled there is no certainty that such locations will result in additional oil and gas reserves or production. The drilling locations on which the Company actually drill wells will ultimately depend upon the availability of capital, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results, additional reservoir information that is obtained and other factors.
|
Definitions |
|
|
"Contingent Resources" |
Definition: Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political, and regulatory matters or a lack of markets. It is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage. |
|
"Prospective Resources" |
Definition: Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development. |
For complete list of risks and contingencies associated with the contingent and prospective resources, refer to the Company's November 4, 2015 news release for the results of its independent resource reports effective as at September 30, 2015 and the associated reader advisories and definitions.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
2/23/2016Madalena Announces an Oil Exploration Discovery in the Lower Agrio Shale in Argentina
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Feb. 16, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) is pleased to announce the initial results of its completion and testing of the Lower Agrio shale formation on its 90% working interest operated block at Curamhuele in Argentina.
Highlights
Kevin Shaw, President and CEO, commented:
"We are extremely pleased with the results from this vertical exploration well at Curamhuele and oil discovery in the Lower Agrio shale. Ultimately this Lower Agrio shale play, like the Vaca Muerta shale, will be developed with Horizontal Multi frac wells which are expected to yield considerably more than a typical vertical well."
Curamhuele Block (90% Working Interest ("WI") Neuquen Basin, Argentina)
Madalena has a 90% WI and is the operator in the 56,216 (50,595 net) acre exploration concession at Curamhuele. On November 9, 2015, the Company successfully deepened the Yapai.x-1001 well to evaluate the Lower Agrio shale and the Mulichinco tight sand formations. The Company drilled approximately 550 metres of the Lower Agrio formation with the bottom 270 metres having strong and steady oil and gas shows. The well required heavy weight mud (40% over normal) to control the flow while drilling. The wireline log analysis of the Lower Agrio shale estimates a zone of interest of greater than 164 metres with an average porosity of 7.7% and confirmation of brittle shale with minimal clay content.
On January 26, 2016, Madalena initiated completion operations on the Yapai.x-1001 well and finished the fourth hydraulic fracture treatment on February 4, 2016. Flow-back commenced on a controlled 3 mm choke for the first four days after which the choke was gradually increased to test the potential of the well. The well continued to clean up with an increasing oil cut and a corresponding decrease in the percentage of water during the testing period. The Company estimates that the water being recovered is a mixture of water based load fluid and formation water.
Due to the high reservoir or pore pressure in the Lower Agrio, the well continued to flow up 5" casing at strong fluid rates during the testing period. The Company is in the process of installing facilities for a long term test. Production will be trucked and processed with oil sales being recognized at the current Argentina Medanito price of US$ 67.50/bbl and solution gas will be flared at this time.
The Company cautions that although the initial test results are very encouraging, they are preliminary and may not necessarily be indicative of the long term performance or of ultimate recovery from the well. The relatively low gas rates throughout the test suggest that the Mulichinco tight sand formation is not yet contributing significant rates of gas and condensate and the oil volumes being produced are believed to be coming solely from the Lower Agrio shale. This could be in part due to the lower reservoir pressure of the Mulichinco which would delay the production response or a less effective hydraulic fracture treatment in that zone. The Company intends to continue additional testing operations, fluid sampling and production well logging to evaluate the opportunity to optimize the deliverability of the well.
Curamhuele Block - Reserves and Resources
There were no reserves assigned to the 2014 year end reserve report for the Lower Agrio shale or Mulichinco tight sand formation and since the production test occurred after December 31, 2015, there will be no reserves in the pending 2015 year end reserve report which will be released later this month.
On November 4, 2015 the Company released independent third party best estimates (P50) effective September 30, 2015 (prior to the drilling of the Yapai.x-1001 well) for Contingent and Prospective Resources. The Company's interest best estimate in the Lower Agrio shale is Unrisked Prospective Resources of 365 MMBoe (or Risked Prospective Resources are 99.4 MMBoe). In addition to the Lower Agrio shale at Curamhuele, the Company's interest best estimate in the Vaca Muerta shale is Unrisked Prospective Resources of 1,157.1 MMBoe (or Risked Prospective Resources of 92.6 MMBoe). Please see the reader advisory at the end of this release for further information on Prospective Resources.
Curamhuele Block - Next Steps
Given the significant inventory of opportunities Madalena has at both Puesto Morales in the Loma Montosa light oil resource play and Coiron Amargo in the Vaca Muerta shale and Sierras Blancas light oil development, the Company intends to actively pursue a strategic partner to help further delineate the Lower Agrio shale and Vaca Muerta shale resources and further assess the Mulichinco tight sand formation on the Curamhuele property.
The Company has met its commitment to drill and complete the Yp.x-1001 well prior to September 2016 and will soon commence discussions with the Province of Neuquén and its 10% partner the provincial oil company, Gas y Petroleo del Neuquén S.A., to secure a new block contract allowing for further advancement of the property.
Coiron Amargo Block (35% WI, Neuquen Basin, Argentina) – Sierras Blancas Horizontal Development Update
Madalena and its partners have successfully drilled their seventh horizontal well in the conventional Sierras Blancas formation with a total lateral length of 763 metres. The first 478 metres (63%) has been completed and tested over a five day (120 hour) period. Average production was 596 Bopd and 350 mcf/d gas at 17% water-cut for a total 654 Boe/d. During the last nine hours, the choke was increased from 8 mm to 10 mm and the well produced at a rate of 729 Bopd and 330 mcf/d at 18% water-cut for a total of 784 Boe/d at a flowing pressure of 800 psi. The well has now been tied in to existing production facilities.
Five of the existing seven horizontal Sierras Blancas wells have additional net pay which will ultimately be completed for production. Madalena and its partners intend to recomplete two of these wells in 2016 and test the effectiveness of higher volume lift equipment.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds over 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, with respect to the characteristics of the properties held by the Company, production levels, and operational, business development and financial plans, and opportunities and the ability of Madalena to execute on such plans and opportunities. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits the Company will derive from them. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Meaning of Boe
The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value.
Analogous Information
Certain information in this news release may constitute "analogous information" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"), including, but not limited to, information relating to areas, assets, wells and/or operations that are in geographical proximity to or believed to be on-trend with lands held by Madalena. Such information has been obtained from public sources, government sources, regulatory agencies or other industry participants. Management of Madalena believes the information may be relevant to help define the reservoir characteristics within lands on which Madalena holds an interest and such information has been presented to help demonstrate the basis for Madalena's business plans and strategies. However, management cannot confirm whether such analogous information has been prepared in accordance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and Madalena is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor. Madalena has no way of verifying the accuracy of such information. There is no certainty that the results of the analogous information or inferred thereby will be achieved by Madalena and such information should not be construed as an estimate of future production levels or the actual characteristics and quality Madalena's assets. Such information is also not an estimate of the reserves or resources attributable to lands held or to be held by Madalena and there is no certainty that such information will prove to be analogous in the future. The reader is cautioned that the data relied upon by Madalena may be in error and/or may not be analogous to such lands to be held by Madalena.
Initial Production Rates
Any references in this document to test rates, flow rates, initial and/or final raw test or production rates, early production, and/or "flush" production rates are useful in confirming the presence of hydrocarbons, however, such rates are not necessarily indicative of long-term performance or of ultimate recovery. Such rates may also include recovered "load" fluids used in well completion stimulation. Readers are cautioned not to place reliance on such rates in calculating the aggregate production for Madalena. In addition, certain Madalena properties are unconventional resource plays which may be subject to high initial decline rates. Such rates may be estimated based on other third party estimates or limited data available at this time and are not determinative of the rates at which such wells will continue production and decline thereafter.
Curamhuele Block – Lower Agrio Shale Formation (Neuquén Basin, Argentina)
The Company has a 90% WI and is the operator in the 56,216 (50,595 net) acre exploration concession.
The Lower Agrio has been tested on the block with a conventional well completion and directly offsetting with a multi frac vertical well completion. Based on the limited information and results to date, the Lower Agrio has been classified as Undiscovered with the estimated recoverable portion classified as Prospective Resources. Given the Company is actively testing the prospect through a planned unconventional completion, the Prospective Resources have been sub-classified as a Prospect which has a higher degree of certainty than a Lead or a Play. The GLJ Report is summarized as follows:
|
Madalena Company Interest | |||
|
Low Estimate |
Best Estimate |
High Estimate | |
|
Undiscovered Petroleum Initially In Place (UPIIP) (MMBbls) |
2,376.6 |
4,606.3 |
6,796.4 |
|
Unrisked Prospective Oil (MMBbls) |
144.9 |
328.2 |
568.5 |
|
Unrisked Prospective Gas (Bcf) |
73.9 |
223.2 |
483.2 |
|
Unrisked Prospective BOE 6:1 (MMBOE) |
157.2 |
365.4 |
649.1 |
|
Risked Prospective Oil (MMBbls) |
39.4 |
89.3 |
154.6 |
|
Risked Prospective Gas (Bcf) |
20.1 |
60.7 |
131.4 |
|
Risked Prospective BOE 6:1 (MMBOE) |
42.8 |
99.4 |
176.5 |
Definition: "Prospective Resources" - Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development.
Risks and Significant Positive and Negative Factors
As discussed, the Lower Agrio has been identified as Prospective Resources. The Chance of Discovery for this unconventional shale play has been defined as the product of the probability of source, maturity, trap or seal, and reservoir properties. The estimated numerical value for the Chance of Discovery is 68%. Based on the interpreted superior reservoir characteristics for the bottom section of the Lower Agrio, the Chance of Development is estimated at 40%. The Chance of Commerciality is the product of the Chance of Discovery and Chance of Development and therefore, the Prospective Resources have been multiplied by 27.2% to arrive at a Risked Prospective Resources estimate. At the time of the report Madalena anticipated first commercial production to occur mid-year 2016 following the successful completion of the Yapai.x-1001 well. The recovery method is based on Hz MF wells. Scoping economics were based Vaca Muerta type curves (assumed to be similar to Lower Agrio) with an estimated cost of US$ 12 million per well. A scenario of 570 Hz MF wells was run.
Significant positive factors for these Prospective Resources estimate include:
Significant negative factors for these Prospective Resources estimate include:
Curamhuele Block – Vaca Muerta Shale Formation (Neuquén Basin, Argentina)
In addition to the Lower Agrio as discussed above, Curamhuele is prospective for the Vaca Muerta. Although there are no Vaca Muerta penetrations on the block there are offsetting wells with indicated hydrocarbons. Based on these logs and geological mapping using 3D seismic along with the basin wide knowledge on the Vaca Muerta reservoir, Ryder Scott Report estimated UPIIP and correspondingly estimated Prospective Resources being the recoverable portion of the UPIIP. Due to the limited information and the early stage exploration efforts the Prospective Resources have been further sub-classified as a Lead.
A summary of the Prospective Resources from the Ryder Scott Report is presented in the following table:
|
Madalena Company Interest | |||
|
Low Estimate |
Best Estimate |
High Estimate | |
|
Undiscovered Petroleum Initially In Place (UPIIP) (MMBbls) |
7,884.0 |
9,642.6 |
11,762.1 |
|
Unrisked Prospective Oil (MMBbls) |
174.6 |
666.9 |
1,207.8 |
|
Unrisked Prospective Gas (MMcf) |
662.4 |
2,941.2 |
8,095.5 |
|
Unrisked Prospective BOE 6:1 (MMBOE) |
285.0 |
1,157.1 |
2,557.1 |
|
Risked Prospective Oil (MMBbls) |
14.0 |
53.4 |
96.6 |
|
Risked Prospective Gas (MMcf) |
53.0 |
235.3 |
647.6 |
|
Risked Prospective BOE 6:1 (MMBOE) |
22.8 |
92.6 |
204.6 |
Risks and Significant Positive and Negative Factors
As discussed, the Vaca Muerta has been identified as Undiscovered Resources at Curamhuele. The geological chance of success in a shale play is based on risk factors that are different than the four risk factors used in conventional reservoir (timing and migration, source rock, reservoir and trap or seal). In the shale play the shale is the source, reservoir and trap. The risk in a shale play is generally defined as presence of shale, significant organic content, thermal maturity, producibility and continuity. Therefore, the Chance of Discovery is the product of these five independent risks. For the Vaca Muerta at Curamhuele, the estimated numerical value for the Chance of Discovery is 32%. The Ryder Scott Report currently estimates the Chance of Development at 25%. Additional well information and test data along with a better understanding of infrastructure issues will be required to improve the Chance of Development. The Chance of Commerciality is the product of the Chance of Discovery and Chance of Development and therefore, the Prospective Resources have been multiplied by 8% to arrive at a Risked Prospective Resource estimate. The recovery method is based on established technology of Hz MF wells. Scoping economics were based on Vaca Muerta type curves with an estimated cost of US$ 13.5 million per well. A scenario of 150 Hz MF wells was run. Commercial production could be achieved with one well however, the Company has not yet scheduled a well for the Vaca Muerta as it is focusing on the Lower Agrio at this time.
Significant positive factors for these Prospective Resources estimate include:
Significant negative factors for these Prospective Resources estimate include:
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
2/16/2016Madalena to Present at the Instituto Argentino de Petroleo y Gas (IAPG)
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Jan. 20, 2016 /PRNewswire/ - Madalena Energy Inc. (TSX-V: MVN and OTCQX: MDLNF) (the "Company" or "Madalena") announces that Kevin Shaw, Madalena's President and CEO, will be a keynote speaker at the Instituto Argentino de Petroleo y Gas ("IAPG") luncheon to be held at the Double Tree Houston Greenway Plaza Hotel at 11:30 AM (CST) on Thursday, January 21, 2016.
Madalena has posted a new corporate presentation for investors and interested parties on its website at www.madalenaenergy.com. This new presentation provides an overview of Madalena's Argentina acreage positions including updates related to the Company's Strategic Unconventional Assets in the Vaca Muerta shale (oil & gas), Lower Agrio shale (oil), Loma Montosa resource play (light oil) and the Mulichinco tight sand play (liquids-rich gas).
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres across 12 blocks and concessions in Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and scalable resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
1/20/20161/12/2016 - Madalena Announces Grant of Options
Madalena Announces Grant of Options
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Jan. 11, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTC: MDLNF) announces the grant of 8,650,000 options ("Options") to certain officers, employees and directors of the Company and its subsidiaries as part of its compensation procedures. Of the Options granted, a total of 8,175,000 Options were granted to directors and executive officers of the Company or its subsidiaries. Each Option has an exercise price of $0.27 per common share of the Company ("Common Share") and is exercisable for a period of five years from the date of grant. The Options vest over a three year period, one-third per year, commencing on the first anniversary of the date of grant.
The Company's rolling stock option plan (the "Plan") was approved by the shareholders at the annual and special meeting of shareholders held on May 26, 2015. The Plan currently reserves up to 54.2 million Common Shares for issuance pursuant to Options, which is equal to 10% of the number of issued and outstanding Common Shares. Options to purchase 43.5 million Common Shares are now outstanding, which is equal to approximately 8% of the number of issued and outstanding Common Shares.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
1/12/20161/7/2016 - Madalena Comments on Argentine Oil Pricing
Madalena Comments on Argentine Oil Pricing
Source: PR Newswire
Orignial Article: http://www.prnewswire.com...
CALGARY, Jan. 7, 2016 /PRNewswire/ - Madalena Energy Inc. ("Madalena" or the "Company") (TSXV: MVN and OTCQX: MDLNF) provides the following comments on recent proposed changes to regulated Argentina oil prices and preliminary information on its 2016 Capital Budget.
PREMIUM PRICING RETAINED IN REGULATED ARGENTINA OIL MARKET
On November 23, 2015, the Argentine Republic elected a new centre-right government. Consistent with its campaign platform, currency controls were relaxed in December 2015 and the Argentine Peso ("AR$") underwent a devaluation to reflect its purchasing power in the global economy. As outlined in Madalena's news release on December 17, 2015, a large percentage of the Company's costs are denominated in AR$. As a result, the Company's cost to produce a barrel of oil in Argentina is expected to decrease in United States dollar ("US$") equivalent terms.
In discussions with Madalena and other Argentina producers, the regulators in Argentina have advised that 2016 oil pricing is expected to be set at approximately US $67.50 per barrel for Medanito crude quality oil, which maintains a premium to Brent and WTI pricing. Although the regulators have indicated the US$ 67.50 will be the posted price for the year there can be no certainty that the oil price will not be further adjusted within the year. For reference, the US$ 67.50 price equals AR$ 911 per barrel at the current 13.5:1 AR$ to US$ foreign exchange rate, compared to the early December 2015 posted price of approximately US$ 75.00 per barrel or AR$ 735 per barrel at the previous 9.8:1 foreign exchange rate.
The Company believes the newly elected federal government is implementing its stated policy of providing a fiscal and regulatory environment that supports development of Argentina's domestic energy resources.
For reference, the link below provides a graph that illustrates the five year historical price of WTI, Brent and Medanito.
http://files.newswire.ca/1379/Madalena_Graph.pdf
MADALENA 2016 CAPITAL BUDGET
With further clarity in Argentina on both the devaluation of the AR$ and the oil pricing environment, the Company will move to finalize its 2016 budget in the coming weeks. This budget will be based on the Company's expectations for US$ 67.50 Medanito oil pricing throughout 2016 and will include all expenditures associated with Madalena's commitments in Argentina. Given the current commodity price environment in Canada, Madalena plans to continue to defer all discretionary capital expenditures on its non-core Canadian assets.
With approximately 95% of Madalena's oil production priced relative to Argentina's premium regulated oil market and a high quality asset base in Argentina, Madalena continues to be well positioned to prudently move forward in the current commodity price cycle.
Madalena's management and board of directors will continue to monitor the Argentina political, market and commodity price environment, with a view to protecting the Company's financial position in the context of its contractual and regulatory obligations.
About Madalena Energy
Madalena is an independent, Canadian-based Argentina focused, upstream oil and gas company.
Madalena holds approximately 950,000 net acres in four provinces of Argentina where it is focused on the delineation of large shale and unconventional resources in the Vaca Muerta shale, Lower Agrio shale, Loma Montosa oil play and the Mulichinco liquids-rich gas play. The Company is implementing horizontal drilling and completions technology to develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance, in particular, with respect to anticipated commodity price changes and the expectation that such pricing changes will remain in effect for a certain period of time, both of which are based on discussions with the Argentina Government, as well as matters related to capital spending plans for the Company.
All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the fact that the information related to commodity price changes and the duration thereof in this news release is based on discussions with the Argentina Government and no formal announcement or decree has been made as of yet with respect thereto; the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The actual results, decisions, pronouncements, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward looking statements will transpire or occur or, if any of them do, what their impact will be on the Company. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. The forward-looking statements in this news release are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements. Investors are encouraged to review and consider the additional risk factors set forth in the Company's Annual Information Form, which is available on SEDAR at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Madalena Energy Inc.
Article Date
1/7/2016Projects & Assets
FERC Highlights
FERC Filings
Production & Forecasts
Subscribe now for access to Criterion Research's historical production and forecast production by company.
Production Hedges
Subscribe now for access to Criterion Research's hedge and analysis.