CALGARY, July 20, 2012 /CNW/ - Contact Exploration Inc. ("Contact" or the "Company") (TSX-V: CEX) is pleased to announce that it has today filed its audited consolidated financial statements for the year ended March 31, 2012 and the related management's discussion and analysis on the Company's profile on the System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedar.com.
Year End Summary
During the year ended March 31, 2012, Contact acquired a 25% operated working interest in 16 contiguous gross sections of land in the prolific Deep Basin at Kakwa, Alberta. Subsequent to the end of the fiscal year, Contact successfully drilled and completed a horizontal well in the Montney Formation at Kakwa. This well tested at 1,150 bbl/d condensate and 8,290 mcf/d gas, being 2,532 boe/d combined (431 bbl/d and 3,109 mcf/d, or 950 boe/d combined, net to Contact and before payout). In addition to well head condensate, the gas analysis from the 13-17 Well suggests up to an additional 70 bbl/mmcf of natural gas liquids could be recoverable with access to a deep cut processing facility. Contact is proceeding with tie in/pipeline work for this well and is currently licensing its second horizontal well on the Kakwa property. As this well was completed after the fiscal year end, the associated reserves are not included in Contact's reserves evaluation for the year ended March 31, 2012.
Contact expanded its oil presence in New Brunswick during the year by drilling the Hopewell structure. The well encountered thick net pay with a significant oil presence. Contact estimates the Hopewell structure to be more aerially extensive and at least as prospective for crude oil as the Stoney Creek field. Contact plans to complete this well and bring it onto production shortly thereafter. Contact also extended the exploration leases on all its gas-prone assets in the Moncton sub-basin for 5 years and all lands with respect to the Company's Hopewell project for 2 years.
Fiscal year end March 31, 2011 (Audited)
Revenues (Net of Royalties and tax
|Loss Per Diluted Share:||(0.027)||(0.011)||(0.022)|
Highlights from the year ended March 31, 2012 include:
- Gross proved oil reserves increased 40% from 319mbbl to 449mbbl. In the calendar year 2011, the Company produced more oil from the Stoney Creek field than had been produced in any other year in the field's 102 year history.
- The Company secured 16 gross sections of land in the Kakwa area of Alberta.
- The Hopewell structure was drilled in the Edgett's Landing area of New Brunswick successfully encountering the oil prone target, within a gross interval greater than 100m thick.
- Numerous lease extensions in New Brunswick were granted, securing all New Brunswick acreage for between 2 and 5 years.
- The Company divested a small Saskatchewan producing asset which was no longer cash flow positive, due to high operational costs.
- Over $2 million in equity financing was obtained.
- A new $2.5 million credit facility agreement was agreed upon between Contact and its lender.
- Contact welcomed Robert Hodgins to its Board of Directors on April 25, 2012. Mr. Hodgins is an independent businessman who brings a wealth of financial, business and corporate governance skills and experience to Contact's Board.
Statement of Reserves Data
Contact is pleased to report that an independent reserves evaluation effective March 31, 2012 (the "GLJ Report") has been completed by its newly appointed reserves evaluator, GLJ Petroleum Consultants Ltd., in accordance with the COGE Handbook. The GLJ Report evaluates the Company's Stoney Creek and Hopewell areas only and does not include the Company's new core area at Kakwa Alberta. In this connection, Contact has today filed on the SEDAR website the following reports for the year ended March 31, 2012, as required under National Instrument 51-101 - Standard of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators: Form 51-101F1 - Statement of Reserves Data and Other Oil and Gas Information, Form 51-101F2 - Reports of Reserve Data by Independent Qualified Reserves Evaluators and Form 51-101F3 - Report of Management and Directors on Oil and Gas Disclosure. These filings can be accessed electronically under Contact's profile on the SEDAR website at www.sedar.com.
About Contact Exploration Inc.
Contact Exploration Inc. is a public company which is currently pursuing
a new core area in Alberta's "Deep Basin" targeting the Montney
Formation. Historically, the Company has been focused on Canadian East
Coast onshore oil and gas exploration and development. Our philosophy
is to operate exploration and development in our core areas of Stoney
Creek, Hillsborough and Edgett's Landing, New Brunswick, and Deep
Basin, Alberta, and to participate through overrides and carried
interests in certain regional unconventional plays in Nova Scotia and
ADVISORY ON FORWARD-LOOKING STATEMENTS: This press release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "continue", "estimate", "may", "will", "should", "believe", "plans", "cautions" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the forgoing, this press release contains statements concerning the timing and scope of exploration and development activities on the Company's properties in the Resthaven-Kakwa area of Alberta, the prospectivity of the Resthaven-Kakwa area and the Hopewell prospect, the petroleum and natural gas reserves and production that may be encountered through the exploration of such properties and future results from operations and the timing of the future development of the Resthaven-Kakwa prospect through horizontal drilling, among others.
Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Contact which have been used to develop such statements and information but which may prove to be incorrect. Although Contact believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Contact can give no 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. In particular, in addition to other factors and assumptions which may be identified herein, no assurances can be given respecting: whether additional drilling operations in the Deep Basin Montney or Hopewell projects will be successful such that further development activities in these areas is warranted; that Contact will continue to conduct its operations in a manner consistent with past operations; results from drilling and development activities will be consistent with past operations; the accuracy of the estimates of Contact's reserve volumes; the general stability of the economic and political environment in which Contact operates; drilling results; field production rates and decline rates; the general continuance of current industry conditions; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Contact to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Contact operates; and the ability of Contact to successfully market its oil and natural gas products.
Further, events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including, without limitation: changes in commodity prices; changes in the demand for or supply of the Company's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Contact or by third party operators of Contact's properties, increased debt levels or debt service requirements; inaccurate estimation of Contact's oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Contact's public disclosure documents. Additional information regarding some of these risk factors may be found under "Risk Factors" in the Company's Management Discussion and Analysis prepared for the year ended March 31, 2012. The reader is cautioned not to place undue reliance on this forward-looking information. The forward-looking statements contained in this press release are made as of the date hereof and Contact undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
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 release.
SOURCE Contact Exploration Inc.