Wrangler West Reports 2009 Operating and Financial Results

CALGARY, April 14 /CNW/ - Wrangler West Energy Corp. ("Wrangler West" or the "Company") (TSX-V "WX") announces today's filing on www.sedar.com of the Company's audited Financial Statements and related Management's Discussion and Analysis("MD&A") for the year ended December 31, 2009.

    
                                 HIGHLIGHTS
    -------------------------------------------------------------------------
    Year ended December 31                        2009       2008   % Change
    -------------------------------------------------------------------------
    OPERATIONAL HIGHLIGHTS
    Production
    Crude oil and NGL (bbls/d)                     293        339        (14)
    Natural gas (mcf/d)                          4,972      6,332        (21)
    Total (boe/d)                                1,122      1,394        (20)
    --------------------------------------------------------------
    Prices
    Crude oil and NGL ($/bbl)                    58.61      87.64        (33)
    Natural gas ($/mcf)                           4.47       8.87        (50)
    --------------------------------------------------------------
    Per boe ($)
    Petroleum and natural gas revenue(1)         35.14      61.58        (43)
    Loss on commodity price contracts                -      (2.52)      (100)
    Royalties                                    (5.20)    (12.74)       (59)
    Operating expenses                          (13.71)    (14.12)        (3)
    --------------------------------------------------------------
    Field netbacks                               16.23      32.19        (50)
    General and administrative                   (3.09)     (2.83)         9
    Interest                                     (1.29)     (1.06)        22
    Current income tax                            2.02      (2.94)      (169)
    --------------------------------------------------------------
    Funds flow from operations                   13.87      25.36        (45)
    Depletion, depreciation and accretion       (23.50)    (24.52)        (4)
    Stock-based compensation                     (1.32)     (0.56)       136
    Future income tax reduction                   2.31       1.42         63
    --------------------------------------------------------------
    Net earnings (loss)                          (8.64)      1.70       (608)
    -------------------------------------------------------------------------
    FINANCIAL HIGHLIGHTS ($ thousand)
    Petroleum and natural gas revenue(1)        14,382     31,422        (54)
    Loss on commodity price contracts                -     (1,287)      (100)
    Royalties                                   (2,128)    (6,500)       (67)
    Operating expenses                          (5,613)    (7,208)       (22)
    General and administrative                  (1,263)    (1,442)       (12)
    Interest                                      (528)      (542)        (3)
    Current income tax                             827     (1,500)      (155)
    --------------------------------------------------------------
    Funds flow from operations                   5,678     12,944        (56)
    Depletion, depreciation and accretion       (9,619)   (12,514)       (23)
    Stock-based compensation                      (540)      (287)        88
    Future income tax reduction                    944        725         30
    --------------------------------------------------------------
    Net earnings (loss)                         (3,538)       868       (507)
    --------------------------------------------------------------
    Outstanding shares (thousand)
    Weighted average - basic                     6,397      6,377          -
    Weighted average - diluted                   6,653      6,783         (2)
    --------------------------------------------------------------
    Funds flow from operations - basic ($/share)  0.89       2.03        (56)
    Funds flow from operations -
     diluted ($/share)                            0.85       1.91        (55)
    Earnings (loss) - basic ($/share)            (0.55)      0.14       (493)
    Earnings (loss) - diluted ($/share)          (0.55)      0.13       (523)
    --------------------------------------------------------------
    Total assets ($ thousand)                   40,239     46,639        (14)
    -------------------------------------------------------------------------
    (1) In 2008, petroleum and natural gas revenue is before realized loss on
        commodity price contracts.

    Wrangler West converts petroleum and natural gas reserves and volumes to
    a common unit of measure on a basis of six thousand cubic feet ("mcf") of
    natural gas equals one barrel ("bbl") of oil. Disclosure using barrels of
    oil equivalent ("boe") may be misleading, particularly if used in
    isolation. The basis for the boe conversion ratio of 6 mcf equals one bbl
    is an energy equivalency conversion method, primarily applicable at the
    burner tip. This conversion rate does not represent a value equivalency
    at the wellhead. The Company calculates boe per day based on total
    production for the period divided by the number of days during the
    period.
    

Wrangler West Energy Corp. presents operating and financial results for 2009. Wrangler West is a Canadian junior oil and natural gas exploration company focused on generating shareholder value by exploring for, developing and producing natural gas and crude oil from properties located in the Province of Alberta.

Review of 2009

The past twelve months presented significant challenges for Wrangler West and all producers who focus predominantly on natural gas production. Wrangler West's production was 75 percent weighted to natural gas. Consequently, cash flow dropped significantly as natural gas prices retreated under the pressure of weak demand, high storage inventory and the threat of overwhelming new supply from numerous shale gas developments on both sides of the Canada/United States border.

For 2009, Wrangler West's production averaged 1,122 boe per day versus the 2008 average of 1,394 boe per day. The lower production reflects both normal declines and the postponement of new drilling activity during 2009.

Wrangler West's 2009 operational activities resulted in an increase of 229 mboe (proved plus probable) and an acquisition added a further 45 mboe (proved plus probable) to our reserves base. Reserves, as evaluated by Sproule Associates Limited effective December 31, 2009, are 1.6 mboe in the proved category and 2.4 mboe in the proved plus probable category, resulting in a net present value of $45 million, discounted at 10 percent.

    
                       Remaining Reserves             Net Present Values
                                                     Before Income Taxes
                             Company                    ($ thousand)
                    Gross(1) Gross(2)  Net(3)   at 0%   at 5%  at 10%  at 15%
    -------------------------------------------------------------------------
    Grand total
     (mboe)
    Proved
     developed
     producing      1,309.1  1,211.6  1,018.0  24,790  21,842  19,618  17,856
    Proved developed
     non-producing    323.9    248.0    200.5  10,105   7,685   6,066   4,934
    Proved
     undeveloped      182.2    182.2    152.9   7,362   6,470   5,747   5,152
      Total proved  1,815.3  1,641.8  1,371.3  42,257  35,997  31,431  27,942
      Total probable  896.5    801.4    657.1  25,560  18,086  13,506  10,482
    -------------------------------------------------------------------------
    Total proved
     plus probable  2,711.8  2,443.2  2,028.4  67,817  54,083  44,937  38,424
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (1) Gross Reserves are the remaining reserves attributable to the
        property.
    (2) Company Gross Reserves are the Company's working interest share of
        the remaining reserves attributable to the property, before deduction
        of any royalties.
    (3) Company Net Reserves are the gross remaining reserves of the property
        in which the Company has an interest, less all crown, freehold, and
        overriding royalties and interests owned by others.
    

Capital Expenditures Scaled Back in 2009

In response to lower cash flow, we scaled back Wrangler West's capital expenditures for exploration and development activities. We also reduced general and administration expenses and, generally, adopted a defensive approach to manage the Company prudently through a year of weak natural gas prices and the general downturn in the North American economy.

In 2009, we concentrated on assembling new prospects, reviewed all of Wrangler West's existing assets and built our go-forward plan. We dedicated our efforts to ensuring the Company remained cash flow positive each month. Surplus cash flow provided working capital and reduced bank indebtedness. Balance sheet improvement was a key driver during 2009. While assuming this defensive posture, it was paramount to generate new opportunities with the potential both to replace normal production declines and to provide future opportunities for growth.

With the strength of crude oil prices throughout the year, we recognized the strategic value in increasing our oil exposure. We completed a small property acquisition adjacent to our Grand Forks oil pool and, late in 2009, we constructed a pipeline to tie-in the three wells to our existing production facility. We also acquired new 3D seismic data and re-evaluated the Grand Forks oil pool to identify opportunities for infill drilling which has the potential to extend the pool.

Improved Outlook for 2010

Throughout 2009, we aggressively marketed our high cost non-operated natural gas assets and completed a property disposition early in 2010. Proceeds from that transaction improved Wrangler West's net debt position for 2010 first quarter.

The improvement to Wrangler West's balance sheet has resulted in a smaller, yet more profitable, production base. Our recent drilling activities have replaced the production sold in the property disposition and overall production volumes are relatively unchanged going forward. We have generated the positive momentum that we expect will carry Wrangler West through the soft shoulder season for natural gas anticipated for the summer of 2010.

Opportunities for junior oil and gas producers are improving with access to land, assets for sale and new resource plays all of which attract capital and build wealth for investors. During 2010, we expect natural gas will continue to challenge producers until North America's supply and demand balance returns.

Wrangler West expects to grow from the current production base and forecasts 2010 capital expenditures at $6.0 million which we will fund with cash flow and existing credit facilities. We intend to be active with the drill bit and will pursue all opportunities that fit our corporate risk profile.

We will direct our efforts to growth in reserves and production. Wrangler West's directors, management and staff have significant shareholdings and our goals are fully aligned with all shareholders. Wrangler West will actively pursue merger, acquisition and disposition strategies that can achieve our objectives for growth and that have the potential to increase shareholder value.

Corporate Profile

Wrangler West is a Canadian junior oil and natural gas producer which has been building production and assets through exploration in Alberta. Since inception, our mandate has been to use the drill bit to add shareholder value. Disciplined management of our operations and production portfolio has created sufficient funds flow to support ongoing operations. Wrangler West will continue to reinvest funds flow from operations and other available capital to protect and add future value. Wrangler West trades on the TSX Venture Exchange under the symbol "WX".

Additional Information

Additional shareholder and public information relating to Wrangler West Energy Corp. is filed on SEDAR and accessible at www.sedar.com. This includes the Statement of Reserves Data and Other Oil and Gas Information Form NI 51-101 F1, F2 and F3 effective December 31, 2009 as well as the Notice of Annual and Special Meeting of Shareholders, the 2010 Management Information Circular, the Form of Proxy in preparation for Wrangler West's Annual and Special Meeting scheduled for May 26, 2010 in Calgary.

The TSX Venture Exchange has not reviewed, and does not accept responsibility for, the adequacy or accuracy of this news release.

SOURCE Wrangler West Energy Corp.

For further information: For further information: Wrangler West Energy Corp., Steven F. Johnson, President and Chief Executive Officer, Steve@wranglerwest.ca, telephone: (403) 290-6800

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Wrangler West Energy Corp.

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