Silverwing Energy Inc. announces financial and operating results for the year and quarter ended December 31, 2007


    CALGARY, March 14 /CNW/ - Silverwing Energy Inc. (TSX: SVW) ("Silverwing"
or the "Company") is pleased to announce its financial and operating results
for the three and twelve month periods ended December 31, 2007.


    -   In August of 2007, Silverwing successfully completed a private
        placement financing raising $30.0 million. These proceeds, together
        with funds from operations and existing credit facilities, were used
        to fund the Company's 2007 capital program. Silverwing had
        188 million common shares outstanding at year end.

    -   During 2007 the Company succeeded in meeting its Tomahawk drilling
        obligations in accordance with terms of the farmin agreement with its
        partners though the drilling of 22 Mississippian and Belly River
        wells. In 2008, Silverwing intends to complete these wells and
        commence testing its high impact Nisku oil exploration prospects once
        the well-licensing process has been completed. Silverwing expects to
        commence drilling its first Nisku well by mid-2008

    -   Capital expenditures totaled $8.0 million and $23.6 million in the
        fourth quarter and fiscal 2007 respectively. This included -

        -  $ 0.8 million on land and seismic
        -  $17.2 million drilling 22 gross (16.4 net) wells
        -  $ 4.7 million on facility infrastructure
        -  $ 0.9 million on other

    -   Production for the fourth quarter of 2007 averaged 747 boepd compared
        with 997 boepd in 2006. The decrease was due to normal declines
        realized in the period as a consequence of Silverwing focusing the
        majority of its capital spending on its Tomahawk project. Production
        for fiscal 2007 averaged 805 boepd compared to 728 boepd in 2006.

    -   Revenue from operations increased 14% to $12.7 million from
        $11.2 million a year ago. This reflected the 11% increase in annual
        average production for the period.

    -   Funds from operations for the fourth quarter decreased to
        $1.5 million compared to $1.7 million over the same period in 2006.
        This reduction was a consequence of production decreases along with
        high production costs offset by royalty adjustments period over
        period. Oil and gas prices received remained relatively unchanged. In
        fiscal 2007, funds from operations decreased 60% to $1.4 million from
        $3.4 million a year ago due to increased operating costs and higher
        interest and financing fees offset by lower royalty rates.

    -   The Company estimated undiscounted future cash flows from proved
        reserves were less than the carrying values of producing petroleum
        and natural gas properties. As a consequence, Silverwing recognized a
        ceiling test impairment of $20.4 million in the year.

    -   A net loss of $0.6 million was recorded in the fourth quarter of 2007
        and a loss of $25.7 million was recorded for the year.

    -   As at December 31, 2007, the Company was in breach of a covenant that
        required the Company to maintain a positive working capital ratio of
        1:1 for the revolving demand loan facility. Silverwing is currently
        in the process of securing appropriate financing to rectify this
        breach. As at March 12, 2008, Silverwing has outstanding bank debt of
        $10.3 million and a working capital deficit of approximately
        $14.7 million. The working capital amount does not include
        $1.2 million held in escrow, classified at year end as a long term
        restricted cash asset that will be released when completion work is
        undertaken on Silverwing's Tomahawk project.


    Years Ended December 31,                      2007       2006     Change
    (000s, except per share amounts)                ($)        ($)        (%)

    Oil and gas revenue                         12,699     11,169         14
    Funds from operations(1)                     1,353      3,355        (60)
      Per share - basic and diluted               0.01       0.18        (94)
    Net income (loss)                          (25,718)   (12,216)       111
      Per share - basic and diluted              (0.26)     (0.65)       (60)
    Capital expenditures                        23,577     63,125        (63)
    Bank debt and working capital deficiency   (14,706)   (19,817)       (26)
    Shareholders' equity                        46,106     46,811         (2)
    (000s)                                        (No.)      (No.)        (%)

    Share Data
    Total shares outstanding
      Basic and diluted                        188,068     33,826        456
    Weighted average shares outstanding
      Basic and diluted                         98,204     18,792        423
    Average daily production
      Natural gas (mcf/d)                        4,524      4,134          9
      Crude oil and NGLs (bbls/d)                   51         39         31
      Total (boe/d)                                805        728         11
    Average selling prices
      Natural gas ($/mcf)                         6.97       6.81          2
      Crude oil and NGLs ($/bbl)                 64.90      63.71          2
      Total ($/boe)                              43.24      42.05          3
    Wells drilled - gross (net) (No.)
      Gas                                       4 (0.2)   26 (8.1)  -85 (-98)
      Oil                                       -- (--)    -- (--)    -- (--)
      Standing/untested                       16 (15.1)    8 (7.5)  100 (101)
      Dry and abandoned                         2 (1.1)    4 (1.4)  -50 (-21)
      Total                                   22 (16.4)  38 (17.0)   -42 (-4)

    (1) Funds from operations is defined as cash provided by operations
        before changes in non-cash operating working capital.


    With the completion of Silverwing's 22-well Mississippian and Belly River
drilling program in 2007, the Company will focus on exploiting the multi-zone
potential that has been uncovered at Tomahawk. Silverwing expects to commence
oil and gas production from Tomahawk in late 2008. In addition, the Company
expects to focus its exploration drilling effort on its high potential Nisku
oil prospects on freehold lands at Tomahawk and on Crown lands at Easyford,
    Finally, Silverwing expects to maintain its Prespatou, BC gas production
assets in 2008 and prepare for a new phase of development as gas commodity
prices strengthen. The Company also intends to evaluate its strategic options
on its Torquay property in Saskatchewan, that is prospective for oil in the
Bakken and in the Midale.
    In order to complete is proposed capital expenditure program in 2008,
Silverwing will require additional capital either in the form of an equity or
debt financing.


    Silverwing's 2007 Audited Annual Financial Statements and Management's
Discussion and Analysis, including the Operations Review, and Reserves Report
that are part of the Annual Report, can be accessed from the Canadian
Securities Administrator's System for Electronic Document Analysis and
Retrieval (SEDAR).


    Silverwing Energy Inc. is a junior oil and gas exploration, development
and production company based in Calgary, Alberta. The Company commenced
drilling and production operations in 2003 and has subsequently established
two core operating regions: the northeastern British Columbia Prespatou
fairway and the Tomahawk area of central Alberta. Silverwing's Tomahawk
Farm-in provides the Company access to over 51,000 net acres of undeveloped
freehold land in the Tomahawk area of central Alberta. The area is known for
its under-explored multi-zone oil and gas potential along with highly
prospective formations including a Nisku interior patch reef oil trend, a zone
of primary interest to Silverwing. The Company has also established an
exploratory presence in the Torquay area of southwestern Saskatchewan, known
for its Midale and Bakken oil potential. All three areas of operation are
primarily immune to recent changes in the royalty regime in Alberta.


    This news release contains disclosure expressed as "boepd" and "mboe".
All oil and natural gas equivalency volumes have been derived using the ratio
of six thousand cubic feet of natural gas to one barrel of oil. Equivalency
measures may be misleading, particularly used in isolation. A conversion ratio
of six thousand cubic feet of natural gas to one barrel of oil is based on an
energy equivalency conversion method primarily applicable at the burner tip
and does not represent a value equivalency at the wellhead.

    Except for historical information contained therein, this news release
    contains forward-looking statements. Forward-looking statements such as
    the references to Silverwing's exploration program and drilling program
    and capital expenditures relating to, and timing of, such programs are
    based on the opinions and estimates of management at the date the
    statements are made, and are subject to a variety of risks and
    uncertainties and other factors that could cause actual events or results
    to differ materially from those anticipated in the forward-looking
    statements. There are uncertainties inherent in forward-looking
    information, including factors beyond Silverwing's control, and no
    assurance can be given that the programs will be completed on time, on
    budget or at all. Silverwing undertakes no obligation to update
    forward-looking information if circumstances or management's estimates or
    opinions should change except as required by law. The reader is cautioned
    not to place undue reliance on forward-looking statements.

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

    %SEDAR: 00023786E

For further information:

For further information: Oleh Wowkodaw, President and Chief Executive
Officer, Terry O'Connor, Senior Vice President, Business Development, Martin
D. Rude, Vice President, Finance and Chief Financial Officer, Silverwing
Energy Inc., 1650, 521 - 3rd Avenue SW, Calgary, Alberta, T2P 3T3, Phone:
(403) 263-5555, Fax: (403) 263-5549

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