Kelt Provides an update on the impact of current Western Canada natural gas prices
Advisory Regarding Forward-looking Statements
This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “execute”, “ongoing”, “may”, “will”, “project”, “should”, “believe” , “plans”, “intends”, “forecasted” and similar expressions are intended to identify forward-looking information or statements. In particular, this press release contains forward-looking statements pertaining to the following: the expected timing of the drilling and completion of wells, the expected timing of wells being brought on-production, the expected timing of facility expenditures, the expected timing of facility start-up dates, the expected length and timing of facility downtime, timing and approval of permit applications in British Columbia, the expected cost and productivity of capital projects and the estimated future rates of return; and the Company’s expected future financial position and operating results.
Although Kelt believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Kelt cannot give any assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general, operational risks in development, exploration and production; risks associated with the COVID-19 pandemic; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production including the estimated timing and completion of maintenance on the NGTL and T-South pipeline systems the uncertainty of the completion of the turnaround maintenance at third party gas plants; the volatility of natural gas prices and the potential of future shut-in production caused by low prices; failure to obtain necessary regulatory approvals for planned operations; health, safety and environmental risks; uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures; volatility of commodity prices, currency exchange rate fluctuations; imprecision of reserve estimates; as well as general economic conditions, stock market volatility; and the ability to access sufficient capital. We caution that the foregoing list of risks and uncertainties is not exhaustive.
In addition, the reader is cautioned that historical results are not necessarily indicative of future performance. The forward-looking statements contained in are made as of the date hereof and the Company does not intend, and does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise unless expressly required by applicable securities laws.
Certain information set out in may be considered as “financial outlook” within the meaning of applicable securities laws. The purpose of this financial outlook is to provide readers with disclosure regarding Kelt’s reasonable expectations as to the anticipated results of its proposed business activities for the periods indicated. Readers are cautioned that the financial outlook may not be appropriate for other purposes.
Non-GAAP Measures and Other Key Financial Measures
This press release refers to adjusted funds from operations, as described below, which does not have a standardized meaning prescribed by GAAP. As this non-GAAP measure is commonly used in the oil and gas industry, the Company believes that its inclusion is useful to investors. The reader is cautioned that these amounts may not be directly comparable to measures for other companies where similar terminology is used.
“Adjusted funds from operations” is calculated as cash provided by (used in) operating activities before changes in non-cash operating working capital and adding back (if applicable): transaction costs associated with acquisitions and dispositions, and settlement of decommissioning obligations. Adjusted funds from operations is used by management as a key measure to assess the ability of the company to fund operating activities, capital expenditures and the repayment of debt; however, it is not intended to be viewed as an alternative to cash provided by (used in) operating activities, net income (loss) or other measures of financial performance calculated in accordance with GAAP.
All dollar amounts are referenced in thousands of Canadian dollars, except when noted otherwise. This press release contains various references to the abbreviation BOE which means barrels of oil equivalent. Where amounts are expressed on a BOE basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel and sulfur volumes have been converted to oil equivalence at 0.6 long tons per barrel. The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead and is significantly different than the value ratio based on the current price of crude oil and natural gas. This conversion factor is an industry accepted norm and is not based on either energy content or current prices. Such abbreviation may be misleading, particularly if used in isolation. References to “oil” in this press release include crude oil and field condensate. References to “natural gas liquids” or “NGLs” include pentane, butane, propane, and ethane. References to “liquids” include field condensate and NGLs. References to “gas” in this discussion include natural gas and sulfur.
|A&D||Acquisitions and dispositions|
|AECO||Alberta Energy Company natural gas pricing hub|
|AESO||Alberta Electric System Operator electric power pricing pool|
|AFFO||Adjusted funds from operations|
|Bbls/d||barrels per day|
|BOE||Barrel of oil equivalent|
|BOE/d||Barrels of oil equivalent per day|
|CAD or CA$||Canadian dollars|
|CO2E||Carbon dioxide equivalent|
|COVID-19||Coronavirus disease caused by the SARS-CoV-2 virus|
|D&C||Drill and complete|
|DUC||Drilled but uncompleted|
|G&A||General and administrative|
|GAAP||Generally accepted accounting principles|
|KELS||Trading symbol for Kelt Exploration Ltd. common shares on the TSX|
|Mcf||thousand cubic feet|
|Mcf/d||Thousand cubic feet per day|
|MMBtu||million British thermal units|
|MMcf||million cubic feet|
|MMcf/d||Million cubic feet per day|
|NGL’s||Natural gas liquids|
|NYMEX Henry Hub||Natural gas pricing hub on the New York Mercantile Exchange|
|P&NG||Petroleum and natural gas|
|sfc||Surface location for a well|
|TSX||The Toronto Stock Exchange|
|USD or US$||United States of America dollars|
|STI||West Texas Intermediate|
For further information, please contact:
Kelt Exploration Ltd., Suite 300, 311 – 6th Avenue SW, Calgary, Alberta, Canada T2P 3H2
David J. Wilson, President and Chief Executive Officer (403) 201-5340, or
Sadiq H. Lalani, Vice President and Chief Financial Officer (403) 215-5310.
Or visit our website at www.kelexploration.com.