AltaCanada Energy Corp. announces Q2 results



    TSX-V SYMBOL: ANG

    CALGARY, Aug. 27 /CNW/ - AltaCanada Energy Corp. is pleased to present
operating and financial highlights for the second quarter of 2007. Complete
details in the Report to Shareholders is available on our website
(www.altacanada.com), on SEDAR at www.SEDAR.com, or from the Corporation.
    In the second quarter 2007, we continued to direct most of our efforts to
the Fort Belknap Reservation in Montana. At the April 23, 2007 Land Sale
conducted by the Bureau of Indian Affairs on behalf of the Fort Belknap
allotted mineral owners, AltaCanada acquired 96 percent of the tracts we bid
on. This success added 157,034 gross acres (43,400 net) all of which were
additional to the 42,587 (14,664 net) acres acquired in November 2005. These
leases carry a 16.6 percent royalty and while some administration efforts
remain, award letters have been received on nearly all new leases.

    Financial Review

    Second quarter oil and gas revenues declined 13 percent. Natural gas
sales volumes declined 14 percent due to fewer wells drilled and completed and
the decrease in oil volumes reflected the 2006 sale of a heavy oil property.
This was offset by slightly higher natural gas prices. An unrealized hedge
gain in the quarter added an additional $1.0 million to total revenue, raising
total revenue to $4.1 million, up from $3.6 million in Q2 2006. A drop in
futures prices in the quarter resulted in a hedge asset of $0.6 million at
June 30, 2007 compared to a hedge liability of $0.4 at the end of the first
quarter of 2007. Cash flow for the first quarter was $1.0 million ($0.02 per
share) compared to $1.7 million ($0.03 per share in 2006). Net earnings,
largely driven by the unrealized hedging gain, were $0.5 million ($0.01 per
share) compared to a loss of $41,148 ($nil per share) in 2006. Expenses in the
quarter, dropped from $2.9 million in 2006 to $2.6 million in 2007 primarily
due to lower depletion and stock based compensation.
    In the second quarter we agreed to move our banking facilities to the
National Bank of Canada and increased our debt facility to $11 million. This
transaction was completed in August.

    Operating Review

    The high level of land sale activity and falling gas prices slowed our
second quarter Montana drilling program to 4 wells (3.47 net) resulting in
2 gas wells (2.0 net) and 2 D&A (1.47 net). In Canada one farmout well was
cased for evaluation. Capital expenditures were $1.2 million compared to
$2.4 million in 2006.
    Expected declines and the 2006 sale of 100 BOE/d are reflected in our
second quarter production averaging 828 BOE/d compared to 1,038 BOE/d in Q2
2006. Our Total Revenue was helped by an aggressive hedging program resulting
in a hedging gain of $1.0 million in the quarter. We have hedged 3,000 GJ/d
with floors averaging $Cdn 7.025 per GJ at AECO through October 31 with one
additional contract of 1,000 GJ/d at $8.51 (at AECO) through to March, 2008.

    Outlook

    Two important wells, on the original block, will be drilled in early
September to evaluate the first of a series of seismic leads on our Fort
Belknap acreage.
    Effective at our Annual General Meeting on June 25, 2007, Mr. Rolf
Gehriger left our Board after four years of service. We thank Rolf for his
contribution. We welcome Mr. James W. Collins of McAllen, Texas, who was
elected to the Board. Jim's background in both oil and gas and banking will
strengthen our board.
    We continue to believe that expanding our natural gas asset base in a
period of weak gas prices will reward our shareholders with substantial
returns.

    
        THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT
         RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

       BOEs MAY BE MISLEADING, PARTICULARLY IF USED IN ISOLATION. A BOE
    CONVERSION RATIO OF 6 MCF : 1 BBL IS BASED UPON AN ENERGY EQUIVALENCY
    CONVERSION METHOD PRIMARILY APPLICABLE AT THE BURNER TIP AND DOES NOT
               REPRESENT A VALUE EQUIVALENCY AT THE WELLHEAD.
    

    The corporate information contained in this news release may contain
forward-looking forecast information. The reader is cautioned that assumptions
used in the preparation of such information, although considered reasonably
accurate by AltaCanada Energy Corp. at the time of preparation, may prove to
be incorrect. The actual results achieved during the forecast period will vary
from the information provided herein and the variations may be material.
Consequently there is no representation by AltaCanada Energy Corp. that actual
results achieved during the forecast period will be the same in whole or in
part as those forecast.


    
    Highlights

                                 Three Months              Six Months
    Period ended June 30         2007         2006         2007         2006
    -------------------------------------------------------------------------
    FINANCIAL
    Petroleum and Natural
     Gas Revenue(*) ($)     3,090,332    3,554,385    6,459,613    7,669,566
    Cash Flow from
     Operations ($)         1,019,306    1,656,909    1,911,996    3,599,792
      Per Common Share
      ($ - Basic/Diluted)        0.02         0.03         0.03         0.06
    Net Earnings
     (Loss) ($)               459,763      (41,148)    (729,471)      95,432
      Per Common Share ($)
      - Basic/Diluted)           0.01        (0.00)       (0.01)        0.00
    Capital
     Expenditures ($)       1,166,700    2,372,690    2,395,266    6,181,951
    Net Debt ($)                                     10,298,506   12,989,681
    Shareholders'
     Equity ($)                                      24,069,665   25,898,547
    Total Assets ($)                                 40,285,808   47,674,407
    Common Shares -
     (weighted average
     for the quarter)
      Basic                                          60,230,745   60,017,814
      Diluted                                        60,565,791   61,175,844
    Common Shares -
     (outstanding -
     at June 30)                                     60,230,745   60,214,078
    -------------------------------------------------------------------------
    OPERATIONS
    Average Daily Oil
     and Gas Sales
      Natural Gas (Mcf/d)       4,938        5,748        4,908        5,774
      Oil and
       NGLs (Bbls/d)                5           80            5           88
      Total (BOE/d)               828        1,038          823        1,050
      % Gas/Oil Ratio            99/1         92/8         99/1         92/8
    Average Prices:
      Natural Gas ($/Mcf)        6.85         5.95         7.23         6.49
      Oil and NGLs
       ($/Bbls)                 32.04        56.36        39.10        44.14
      Total ($/BOE)             41.04        37.27        43.38        39.39
    -------------------------------------------------------------------------
    WELLS DRILLED
      Gross                         5            7            8           18
      Net                         3.5          6.3          4.1         16.7
    -------------------------------------------------------------------------

    (*) Including royalty income and excluding hedge revenue (loss)
    




For further information:

For further information: Don Foulkes, President, Telephone: (403)
265-9091 (ext 248), Fax: (403) 256-9021, Email: info@altacanada.com

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ALTACANADA ENERGY CORP.

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