Bengal Energy Announces Fiscal 2012 Results

CALGARY, June 14, 2012 /CNW/ - Bengal Energy Ltd. (TSX: BNG) ("Bengal" or the "Company") today announced its financial and operating results for the year ended March 31, 2012.

FISCAL 2012 HIGHLIGHTS:

  • Production increased by 33%: Averaged overall production of 135 barrels of oil equivalent per day (boe/d), an increase of 33% over the 101 boe/d for the year ended March 31, 2011. This was a result of increased production from the Cooper Basin of Australia, including Cuisinier 2 and 3 that began producing at the end of August 2011;

  • Revenue increased by 133%: Reported revenue of $4.3 million, an increase of 131% over the year ended March 31, 2011;

  • Netbacks increased by 114%: Achieved netback of $45.72/boe, an increase of 114% over $21.34/boe for the year ended March 31, 2011; Australian netback of $68.81/boe reflects the strength of the Brent benchmark crude oil prices and is an increase of 43% over $48.02/boe for the previous year;

  • Reserves (2P) increased by 9%: Independent third party year-end reserves evaluation to March 31, 2012 have shown a 9% year-over-year corporate proved plus probable ("2P") reserves increase, driven by a 32% increase of 2P reserves at Cuisinier, offset by natural declines and 2P reserves reductions of 4% and 21% respectively at Toparoa, Australia and Oak, BC., with the latter being a Canadian natural gas and natural gas liquids ("NGL") producing property. Based on 2P reserves additions, the Company replaced over twice its annual production to March 31 2012. Detailed reserves disclosures will be included in Bengal's 2012 Annual Information Form to be filed on SEDAR at www.sedar.com;

  • Rig purchased for operated drilling program: On April 5, 2012, the Company announced the purchase of an Ideco H-44 drilling rig and its associated equipment for initial use in its calendar 2012 operated exploratory drilling program in the Cooper Basin. The Rig is a 750 HP carrier-mounted double with a depth capability of 3,000 metres. The rig provides the Company with an opportunity to reduce the execution risk and cost structure on its upcoming Tookoonooka drilling campaign as well as increase control and flexibility over the program so opportunities can be fully evaluated;

  • Largest drilling campaign in Company history underway: Launched a drilling campaign early in fiscal 2013, which is expected to include four Cuisinier wells and three Tookoonooka wells. On June 4, 2012 the Company announced that the first appraisal well in the campaign, spudded on May 20, 2012, will be cased as a future oil producer with an estimate of at least 9.1m of net pay. Three more appraisal wells are expected to follow at Cuisinier in fiscal 2013. Bengal expects to commence its 100% operated Tookoonooka campaign in July 2012.

For a discussion of the activities on each of the Company's permits, refer to Bengal's management's discussion and analysis for the year ended March 31, 2012 filed on SEDAR at www.sedar.com.

Financial and Operating Summary

                     
$000s except per share, volumes
and netback amounts
Three Months Ended Twelve Months Ended
  03/31/12   03/31/11   12/31/11              03/31/12         03/31/11
Revenue                    
  Natural gas $  59 $  125 $  92 $  310 $  488
  Natural gas liquids    16   17         23         68   67
  Oil        547   549      1,213      3,908   1,298
  Total        622   691        1,328       4,286   1,853
Royalties         56   67            121            394   181
  % of revenue        9.0   9.7             9.1             9.2   9.8
Operating & transportation       312   295            486         1,636   883
Netback(1)       254   328           721         2,256   788
Cash flow from (used in) operations:        486   (725)          (417)       (1,142)   (2,523)
  Per share ($) (basic & diluted)         0.01   (0.02)         (0.01)          (0.02)   (0.10)
Funds from (used in) operations:(1)     (635)   (669)       (402)        (1,459)   (2,582)
  Per share ($) (basic & diluted)    (0.01)   (0.02)   (0.01)           (0.03)   (0.10)
Net (loss):     (1,424)   (890)           (477)         (7,209)   (3,340)
  Per share ($) (basic & diluted)     (0.03)   (0.03)        (0.01)         (0.14)   (0.13)
Capital expenditures $  2,233 $  1,879 $  4,327 $  10,838 $  3,943
Volumes                                                              
  Natural gas (mcf/d)       304   348         271            254   354
  Natural gas liquids (boe/d)            2   3              4             3   3
  Oil (bbl/d)         50   56          108            90   39
  Total (boe/d @ 6:1)        103   117          157           135   101
Netback(2) ($/boe)                               
  Revenue $  66.62 $  65.49 $  92.03 $   86.80 $  50.13
  Royalties       6.02   6.38            8.43         7.97   4.90
  Operating & transportation     33.33   27.97         33.71        33.12   23.89
  Total $  27.27 $  31.13 $  49.89 $   45.72 $  21.34
(1)  Funds from operations is a non-IFRS measure. The comparable IFRS measure is cash flow from operations.
A reconciliation of the two measures can be found in Bengal's 2012 management's discussion and analysis.
(2)  Netback is a non-IFRS measure. Netback per boe is calculated by dividing the revenue less royalties,
operating and transportation costs in total for the Company by the total production of the Company
measured in boe.

Bengal has filed its consolidated financial statements and management's discussion and analysis for the year ended March 31, 2012 with Canadian securities regulators. The documents are available on SEDAR at www.sedar.com or by visiting Bengal's website at www.bengalenergy.ca.

About Bengal

Bengal Energy Ltd. is an international junior oil and gas exploration and production company with assets in Australia and India. The Company is committed to growing shareholder value through international exploration, production and acquisitions. Bengal trades on the TSX under the symbol BNG. Additional information is available at www.bengalenergy.ca.

Forward-Looking Statements
This news release contains certain forward-looking statements or information ("forward-looking statements") as defined by applicable securities laws that involve substantial known and unknown risks and uncertainties, many of which are beyond Bengal's control. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward looking statements. The use of any of the words "plan", "expect", "prospective", "project", "intend", "believe", "should", "anticipate", "estimate", or other similar words or statements that certain events "may" or "will" occur are intended to identify forward-looking statements.  The projections, estimates and beliefs contained in such forward looking statements are based on management's estimates, opinions, and assumptions at the time the statements were made, including assumptions relating to: the impact of economic conditions in North America, Australia, India and globally; industry conditions; changes in laws and regulations including, without limitation, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced;  increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; stock market volatility and fluctuations in market valuations of companies with respect to announced transactions and the final valuations thereof; and the ability to obtain required approvals and extensions from regulatory authorities. We believe the expectations reflected in those forward-looking statements are reasonable but, 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 so, what benefits that Bengal will derive from them. As such, undue reliance should not be placed on forward-looking statements.  Forward-looking statements contained herein include, but are not limited to, statements regarding:  the calendar 2012 Cuisinier and Tookoonooka drilling programs, including the number of wells and timing thereof and the targeted zones; and the casing of the first Cuisinier appraisal well.  The forward looking statements contained herein are subject to numerous known and unknown risks and uncertainties that may cause Bengal's actual financial results, performance or achievement in future periods to differ materially from those expressed in, or implied by, these forward-looking statements, including but not limited to, risks associated with: the failure to obtain required regulatory approvals or extensions; failure to secure required equipment and personnel; changes in general global economic conditions including, without limitations, the economic conditions in North America, Australia, India; increased competition; the availability of qualified operating or management personnel; fluctuations in commodity prices, foreign exchange or interest rates; changes in laws and regulations including, without limitation, the adoption of new environmental and tax laws and regulations and changes in how they are interpreted and enforced; the results of exploration and development drilling and related activities; the ability to access sufficient capital from internal and external sources; and stock market volatility.  Readers are encouraged to review the material risks discussed in Bengal's Annual Information Form under the heading "Risk Factors" and in Bengal's annual MD&A under the heading "Risk Factors". The Company cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking statements contained in this news release speak only as of the date hereof and Bengal does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be require pursuant to applicable securities laws.

Barrels of Oil Equivalent
When converting natural gas to equivalent barrels of oil, Bengal uses the widely recognized standard of 6 thousand cubic feet (mcf) to one barrel of oil (boe). However, a boe may be misleading, particularly if used in isolation. A boe conversion ratio of 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. 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 on a 6:1 basis may be misleading as an indication of value.

Certain Defined Terms
boe - barrels of oil equivalent
boe/d - barrels of oil equivalent per day
bbl - barrel
bbl/d - barrels per day
mcf - thousand cubic feet
mcf/d - thousand cubic feet per day 

Non-IFRS Measurements
Within this release references are made to terms commonly used in the oil and gas industry. Funds from operations, funds from operations per share and netbacks do not have any standardized meaning under International Financial Reporting Standards (IFRS) and previous generally accepted accounting principles (GAAP) and are referred to as non-IFRS measures. Funds from operations per share is calculated based on the weighted average number of common shares outstanding consistent with the calculation of net income (loss) per share. Netbacks equal total revenue less royalties and operating and transportation expenses calculated on a boe basis. Management utilizes these measures to analyze operating performance. The Company's calculation of the non-IFRS measures included herein may differ from the calculation of similar measures by other issuers. Therefore, the Company's non-IFRS measures may not be comparable to other similar measures used by other issuers. Funds from operations is not intended to represent operating profit for the period nor should it be viewed as an alternative to operating profit, net income, cash flow from operations or other measures of financial performance calculated in accordance with IFRS. Non-IFRS measures should only be used in conjunction with the Company's annual audited and interim financial statements.

 

 

SOURCE Bengal Energy Ltd.

For further information:

Bengal Energy Ltd.
Chayan Chakrabarty, President and CEO
Bryan Goudie, Chief Financial Officer
(403) 205-2526
Email: investor.relations@bengalenergy.ca
Website: www.bengalenergy.ca

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