TORONTO, May 26 /CNW/ - Alange Energy Corp. (TSXV: ALE) ("Alange Energy" or the "Company") announced today the release of its unaudited interim consolidated financial results for the three months ended March 31, 2010, together with its Management's Discussion and Analysis. These documents will be available on the Company's website at www.alangeenergy.com and at www.SEDAR.com.
In keeping with its strategy, the Company announced its second consecutive quarter of growth in its share of production from its oil and gas properties since it went public in July 2009, resulting in a 27% increase in revenues in the first quarter of 2010 to $10.5 million compared with revenues of $8.3 million in the final quarter of 2009. With its gross share of production (before deduction of royalties) averaging 2,305 barrels of oil equivalent ("boe") per day, the Company exited the first quarter of 2010 with a daily production rate of 2,280 boe, up 7% from the end of December 2009. The Company's daily production rate has since increased to approximately 2,550 boe per day at present and is expected to surpass 3,500 boe per day before the end of the second quarter of 2010. The Company expects to reach the 10,000 boe per day level early in the second quarter of 2011.
Luis E. Giusti, the Company's Chief executive Officer, stated "the results of the first quarter of 2010 demonstrate our continued focus of our core assets, led by our continuing success in the exploration, appraisal and development campaign at Cubiro. With seven rigs currently active in the field, the second quarter will see the Company continue to execute its growth strategy and expand our resource base within our portfolio".
For the quarter ended March 31, 2010, the Company generated net operating income from its oil and gas operations of $1.0 million. After exploration, general and administrative expenses and a $3.1 million non-cash foreign exchange loss, the Company reported a net loss of $5.7 million or $0.01 per share in the first quarter of 2010 compared with a net loss of $2.7 million or $0.02 per share in the first quarter of 2009.
The Company has recently succeeded in its efforts to put in place additional debt financing for up to $27.0 million that, together with its $6.6 million of cash and restricted cash balances at March 31, 2010 and cash flow from operations, will be available to fund its $76.0 million capital program planned for 2010. To date, the Company has executed drawdowns totalling $9.0 million from two term loans and expects to receive an additional $15.0 million from a third term loan by mid-June 2010. The Company may also receive up to an additional $3.0 million of proceeds from a second disbursement under one of these term loans. The loans, primarily with local Colombian banks, have terms ranging from two to three years, are repayable in equal monthly blended payments of principal and interest, and are secured by a pledge of oil sales from Cubiro required to meet the monthly term loan repayments.
Management will hold a conference call on Thursday, May 27, 2010 at 9:00 a.m. Eastern Time to provide an operational update and to discuss the first quarter results. Analysts and interested investors are invited to participate as follows:
Toronto & International: 1 (647) 427-7450
North America: 1 (888) 231-8191
Conference ID: 78236703
Playback of the conference call will be available starting two hours after the call's completion and up to 11:59 pm Eastern Time on June 10, 2010. To access the playback, please call either 1-800-642-1687 (toll free) or 416-849-0833 with the password 78236703.
Alange Energy is a Canadian-based oil and gas exploration and production company, with working interests in 12 properties in four basins in Colombia. Further information can be obtained by visiting our website at www.alangeenergy.com.
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the company based on information currently available to the company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia; changes to regulations affecting the company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the company's periodic reports filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
Information in this press release expressed in barrels of oil equivalent (boe) is derived by converting natural gas to oil in the ratio of six thousand cubic feet (mcf) of natural gas to one barrel (bbl) of oil. 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.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
SOURCE ALANGE ENERGY CORP.
For further information: For further information: Michael Davies, Chief Financial Officer, (416) 360-4653, ext. 224