One Exploration Inc. announces 2009 2nd quarter results


    CALGARY, Aug. 19 /CNW/ - One Exploration Inc. (the "Corporation" or
"OneEx") announces its financial and operating results for the three month
period ended June 30, 2009 and provides an update on its current operations.

    Financial and Operating Summary

                        Three months ended June 30  Six months ended June 30
                                 2009         2008         2009         2008
    Financial highlights ($)

    Petroleum and natural
     gas sales              1,908,943    6,140,398    4,034,153   10,188,615
    Net earnings (loss)    (2,393,708)     547,025   (4,017,163)   1,298,212
    Net earnings (loss)
     per share (i)
      -  basic                  (0.04)        0.02        (0.07)        0.04
      -  diluted                (0.04)        0.02        (0.07)        0.04
    Cash flow                (355,174)   2,896,071     (749,293)   3,795,041
    Cash flow per share (i)
      -  basic                  (0.01)        0.08        (0.01)        0.11
      -  diluted                (0.01)        0.08        (0.01)        0.11
    Working capital
     (deficit) at period
     end                   (6,861,095)  (7,021,306)  (6,861,095)  (7,021,306)
    Capital expenditures
     and dispositions         221,260    2,115,645    2,226,344    6,676,262


      Natural gas (mcf
       per day)                 2,951        4,479        3,212        4,233
      Crude oil and NGLs
       (bbls per day)             179          204          160          185
      BOE per day (6:1)           671          950          695          889
    Average realized price
      Natural gas
       ($ per mcf)               3.59        10.64         4.40         9.43
      Crude oil and NGLs
       ($ per bbl)              54.69        93.37        48.73        84.91
      BOE ($ per boe, 6:1)      31.27        71.02        32.04        62.95

    (i) Class B common shares are converted to Class A common shares using a
        ratio of $10 divided by the greater of the period end Class A common
        share price and $1. For periods ended June 30, 2009, Class B common
        shares were converted using a Class A common share price of $1. At
        June 30, 2008, the closing Class A common share price was $1.47 and
        as such Class B common shares were converted at $1.47 for periods
        ended June 30, 2008.

    Second Quarter Review

    OneEx carried out limited field activities in the second quarter of 2009
as it continued to focus on cost reduction, cash conservation and balance
sheet integrity during this extended period of weak natural gas prices.
Capital spending totaled $0.2 million for the 3 months ended June 30, 2009.
Production was down from the fist quarter of 2009 due to the Corporation's
voluntary shut-in of 75 boe/d of natural gas production along with 100 boe/d
of downtime associated with maintenance of third party processing facilities
at Swan Hills and Paddle River.
    Low natural gas prices resulted in Operating netbacks for the second
quarter of 2009 were $6.32 per boe, a decrease of 85 percent from $41.90 per
boe realized in the second quarter of 2008. Operating netbacks for the six
months ended June 30, 2009 were $5.72 per boe, a decrease of 82 percent from
$31.99 per boe realized for the six months ended June 30, 2008.
    Over all, our primary focus in the second quarter of 2009 was cost
reduction along with adding drilling and completion projects into inventory
which we can efficiently execute with commodity price improvement. OneEx
currently has an inventory of 64 drilling and 21 recompletion opportunities.
In addition, the Corporation is continuing to add to its prospect inventory by
accessing its $3.0 million strategic land fund announced earlier in the year.
With landsale prices at their lowest level in seven years, this presents a
unique and cost effective way for OneEx to build its prospect inventory today
in anticipation of a recovery in commodity prices, specifically natural gas.

    Subsequent to the Quarter

    As previously announced on August 10th, OneEx sold several non-operated
Alberta natural gas properties for $2.4 million. Pro-forma net debt
immediately following the property sale is $4.5 million. In conjunction with
the property disposition, the Corporation's bank line was set at $5.7 million.
Current production, net of dispositions, is estimated to be between 525-575
boe/d with 140 boe/d currently shut-in.
    The Corporation incurred restructuring related expenses of $105 thousand
during the second quarter of 2009, and an additional $425 thousand during the
third quarter of 2009. The reduced staffing levels arising from the
restructuring and the effects of other cost saving initiatives will lower cash
gross general and administrative expenses by approximately $800 thousand
annually. The cost-cutting measures implemented to date are expected to have a
significant impact on cash flows in future quarters.


    As a natural gas producer OneEx has faced a challenging year to date.
Notwithstanding the short term bearish outlook on natural gas, we believe the
long term fundamentals in our sector remain strong. OneEx will continue to
assemble projects through its strategic land joint venture along with focusing
on cost reduction and production optimization. The Corporation is aware of the
challenges of operating in this unprecedented environment and will continue to
base its financial and operating decisions on value preservation and
strengthening of its balance sheet. OneEx continues to evaluate potential
consolidation targets and believes that a stable production base, clean
balance sheet, large prospect inventory and tax pools in excess of $100
million enhances the potential for much needed consolidation in our peer

    On behalf of the board of directors,
    Walter Vrataric

    Reader Advisory

    This news release does not constitute an offer to sell securities, nor is
it a solicitation of an offer to buy securities, in any jurisdiction. All
sales will be made through registered securities dealers in jurisdictions
where the offering has been qualified for distribution. The securities offered
are not, and will not be, registered under the securities laws of the United
States of America, nor any state thereof and may not be sold in the United
States of America absent registration in the United States or the availability
of an exemption from such registration.

    Neither the TSX Venture Exchange nor its Regulation Service Provider (as
    that term is defined in the policies of the TSX Venture Exchange) accepts
    responsibility for the adequacy or accuracy of this release.

    Natural gas volumes are converted to barrel of oil equivalent at six
thousand cubic feet of natural gas for each barrel of oil equivalent ("boe")
based on the relative heating content of natural gas to crude oil. Readers are
cautioned that the relative values of natural gas and crude oil may differ and
that the barrel of oil equivalent measure may not be representative of the
relative values of natural gas and crude oil. In this news release: boe/d
means boe per day; mcf/d means thousand cubic feet per day; mboe means
thousand boe; mmcf means million cubic feet; bbl means barrel and mmbtu means
million British Thermal Units.
    Investors are further cautioned that the preparation of financial
statements in accordance with Canadian generally accepted accounting
principles ("GAAP") requires management to make certain judgments and
estimates that affect the reported amounts of assets, liabilities, revenues
and expenses. Estimating reserves is also critical to several accounting
estimates and requires judgments and decisions based upon available
geological, geophysical, engineering and economic data. These estimates may
change, having either a negative or positive effect on net earnings as further
information becomes available, and as the economic environment changes.
    The terms "funds from operations", "operating netbacks" and "net debt"
are not recognized measures under GAAP. OneEx's method of calculating these
measures may differ from other companies, and accordingly these measures may
not be comparable to measures used by other companies. The Corporation
determines its funds from operations as cash flow from operating activities
before changes in non-cash working capital. Funds from operations per share
are calculated using the weighted average basic and diluted shares used in the
calculation of earnings per share. Management believes that in addition to
cash flow from operating activities, funds from operations is a useful
supplemental measure as it demonstrates OneEx's ability to generate cash
necessary to repay debt or fund future growth through capital investment
before changes in non-cash working capital balances. Investors are cautioned
that funds from operations should not be construed as an alternative to cash
flow from operating activities determined in accordance with GAAP. Operating
netback per boe is the net result of the Corporation's revenue, royalty, lease
operating and transportation expenses as found in the accompanying financial
statements divided by total sales volumes in the period. Management considers
operating netback an important measure as it demonstrates its property level
profitability on a unit of production basis. Net debt is the net result of
deducting the Corporation's current assets from its total bank debt and
current liabilities.

    This news release contains certain forward-looking statements, which are
based on OneEx's current internal expectations, estimates, projections,
assumptions and beliefs. Some of the forward-looking statements may be
identified by words such as "expects", "anticipates", "believes", "projects",
"plans" and similar expressions. These statements are not guarantees of future
performance and involve a number of risks and uncertainties, many of which are
beyond OneEx's control. In particular, forward-looking statements included in
this news release include, but are not limited to, statements with respect to
average production and projected exit rate; areas of operations; spending and
increase in capital budget; availability of funds for OneEx's capital program;
the size of, and future net revenues from, reserves; the focus of capital
expenditures; expectations regarding the ability to raise capital and to
continually add to reserves through acquisitions and development; projections
of market prices and costs; the performance characteristics of OneEx's
properties; OneEx's future operating and financial results; capital
expenditure programs; supply and demand for oil and natural gas; average
royalty rates; and amount of general and administrative expenses. In addition,
statements relating to "reserves" or "resources" are deemed to be forward
looking statements, as they involve the implied assessment, based on certain
estimates and assumptions, that the resources and reserves described can be
profitably produced in the future. These forward-looking statements are
subject to numerous risks and uncertainties, certain of which are beyond
OneEx's control, including the effect of acquisitions; changes in general
economic, market and business conditions; changes or fluctuations in
production levels; unexpected drilling results, commodity prices, currency
exchange rates, capital expenditures, reserves or reserves estimates and debt
service requirements; changes to legislation, investment eligibility or
investment criteria; OneEx's ability to comply with current and future
environmental or other laws; OneEx's success at acquisition, exploration and
development of reserves; actions by governmental or regulatory authorities
including increasing taxes, changes in investment or other regulations; the
occurrence of unexpected events involved in the exploration for, and the
operation and development of, oil and gas properties; competition from other
producers; the lack of availability of qualified personnel or management;
changes in income tax laws or changes in tax laws and incentive programs
relating to the oil and gas industry; hazards such as fire, explosion,
blowouts, cratering, and spills, each of which could result in substantial
damage to wells, production facilities, other property and the environment or
in personal injury; stock market volatility; and ability to access sufficient
capital from internal and external sources. Many of these risks and
uncertainties are described in OneEx's Annual Information Form which is
available at Readers are also referred to risk factors
described in other documents OneEx files with Canadian securities authorities.
With respect to forward-looking statements contained in this news release,
OneEx has made assumptions regarding: current commodity prices and royalty
regimes; availability of skilled labour; timing and amount of capital
expenditures; future exchange rates; the price of oil and natural gas; the
impact of increasing competition; conditions in general economic and financial
markets; availability of drilling and related equipment; effects of regulation
by governmental agencies; royalty rates and future operating costs. Management
has included the above summary of assumptions and risks related to
forward-looking information provided in this news release in order to provide
shareholders with a more complete perspective on OneEx's future operations and
such information may not be appropriate for other purposes. OneEx's actual
results, performance or achievement could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance 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 the OneEx will derive there from. Readers are cautioned
that the foregoing lists of factors are not exhaustive. These forward-looking
statements are made as of the date of this NEWS RELEASE and OneEx disclaims
any intent or obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or results or otherwise,
other than as required by applicable securities laws.

For further information:

For further information: Walter Vrataric, President and Chief Executive
Officer, One Exploration Inc., Phone: (403) 781-2752, Fax: (403) 232-8463;
Dennis Ward, Vice President, Finance and Chief Financial Officer, One
Exploration Inc., Phone: (403) 781-2756, Fax: (403) 232-8463

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