Condor announces 2014 year end results
CALGARY, March 18, 2015 – Condor Petroleum Inc. (“Condor” or the “Company”) (TSX: CPI) is pleased to announce the release of its Consolidated Financial Statements for the year ended December 31, 2014, together with the related Management’s Discussion and Analysis. These documents will be made available under Condor’s profile on SEDAR at www.sedar.com and on the Condor website at www.condorpetroleum.com. All financial amounts in this news release are presented in Canadian dollars, unless otherwise stated.
- During 2014 the Company completed the sale of its 66% interest in the Marsel property for US $88.0 million (CAD 98.1 million).
- Working capital as of December 31, 2014 was $59.0 million and the Company has no debt.
- Net income for the year ended December 31, 2014 was $23.5 million or $0.07 per share including a $34.5 million gain on the sale of the Marsel property.
- The KN-E-205 Primary Basin appraisal well was drilled in the fourth quarter to a total depth of 1,876 meters and encountered multiple sandstone reservoirs that have a total of 71 meters of net oil pay. The well was cased to total depth. This well further validates the geological model used to characterize the Primary Basin play, continuing to reduce the geologic risk associated with the deeper Primary Basin prospects on Zharkamys like KN-501.
- The tendering process is underway to select services for drilling the KN-501 Primary Basin target, scheduled to commence in the second quarter of 2015. The KN-501 well offsets the Company’s play opening KN-E Primary Basin discovery by eight kilometers and is located under the same salt dome. The well is planned to reach 4,250 meters and is targeting 67 MMboe unrisked mean prospective resources (internal Company estimate – see Reserve and Resource Advisory).
- During 2014 the Zharkamys exploration period was extended for an additional five months to February 8, 2016 and an application to extend the exploration period for a further ten months until December 2016 has been submitted.
- Production facilities at the Shoba and Taskuduk oilfields have been constructed and, for each respective field, once a development contract is executed with the Government of Kazakhstan the Company will be entitled to access export markets to sell a portion of the crude oil produced.
- Production increased 64% to an average of 343 bopd for the three months ended December 31, 2014 from 210 bopd for the same period in 2013 and decreased 30% to 205 bopd for the year ended December 31, 2014 from 291 bopd in 2013. The fourth quarter increase relates to the positive performance of the two Shoba horizontal wells which were successfully drilled and completed in the fourth quarter of 2014, representing the first shallow horizontal wells drilled in Kazakhstan’s Pre-Caspian basin. Sh-10h began producing in late October and Sh-11h in mid-December. Flow rates on both wells have been restricted thus far to minimize the potential for water and gas coning.
- Production at Shoba has been temporarily suspended effective March 15, 2015 for an indeterminate period due to constraints in domestic refining capacity and low prices for crude oil and refined crude oil products. Kazakhstan is experiencing an oversupply of refined crude oil products, including diesel, which is causing downward pricing pressures on domestically produced diesel and on crude oil. Currently, Kazakhstan refineries are either not operating or the offering prices are below the Company’s cost of operations. The Government of Kazakhstan recently announced that export customs duties on crude oil and certain refined products will be reduced and a temporary ban on imports of gasoline and diesel fuel from Russia has also been imposed. Both measures are intended to help alleviate the domestic market oversupply.