TIDMTGL
RNS Number : 5913R
TransGlobe Energy Corporation
30 October 2019
This Announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation No. 596/2014 ("MAR"). Upon
the publication of this Announcement, this inside information is
now considered to be in the public domain.
TRANSGLOBE ENERGY CORPORATION ANNOUNCES
THIRD QUARTER 2019 FINANCIAL AND OPERATING RESULTS
For the three and nine months ended September 30, 2019
AIM & TSX: "TGL" & NASDAQ: "TGA"
Calgary, Alberta, October 30, 2019 - TransGlobe Energy
Corporation ("TransGlobe" or the "Company") is pleased to announce
its financial and operating results for the three and nine months
ended September 30, 2019. All dollar values are expressed in United
States dollars unless otherwise stated. TransGlobe's Condensed
Consolidated Interim Financial Statements together with the notes
related thereto, as well as TransGlobe's Management's Discussion
and Analysis for the three and nine month periods ended September
30, 2019 and 2018, are available on TransGlobe's website at
www.trans-globe.com.
Highlights:
u Third quarter production averaged 15,943 boe/d (Egypt 13,750
bbls/d, Canada 2,193 boe/d), a decrease of 997 boe/d (6%) over the
previous quarter, and sales averaged 14,122 boe/d. Production to
date in October averaged approximately 15,206 boe/d (Egypt 13,228
bbls/d, Canada 1,978 boe/d);
u Production for the nine months ended September 30, 2019
averaged 16,269 boe/d (Egypt 14,010 bbls/d, Canada 2,259 boe/d),
which was above guidance and 15% higher than the same period in
2018;
u 2019 production guidance is now expected to range from 15,500
to 16,000 boe/d with a midpoint of 15,750 boe/d for the year;
u Positive third quarter funds flow of $9.4 million ($0.13 per
share). Third quarter net earnings of $3.0 million ($0.04 per
share);
u Ended the third quarter with positive working capital of $47.2
million, including cash and cash equivalents of $24.4 million;
u NWG 38D-1 (drilled in Q2-2019) is confirmed as an oil
discovery following completion and perforation, and will be put on
production in Q4-2019 following stimulation;
u Completed SGZ-6X as an upper Bahariya oil producer in the
Western Desert (approval received in Q3-2019), with construction of
an early production facility on schedule for late Q4-2019,
targeting an initial production rate of approximately 1,000
bbls/day;
u Drilled four horizontal Cardium oil wells in the Harmattan
area of Canada during the quarter, including three development
wells and one outpost appraisal well;
u Sold 380 thousand barrels ("mbbls") of inventoried entitlement
crude oil to EGPC in September 2019;
u Continues to review opportunities for inorganic growth in line
with our M&A strategy;
u Paid a dividend of $0.035 per share on September 13, 2019 to
shareholders of record on August 30, 2019.
FINANCIAL AND OPERATING RESULTS
(US$000s, except per share, price, volume amounts and %
change)
Three Months Ended Nine Months Ended September
September 30 30
Financial 2019 2018 % change 2019 2018 % change
---------------------------- ------- -------- -------- ------- -------- --------------------
Petroleum and natural gas
sales 64,388 74,345 (13) 214,728 226,516 (5)
Petroleum and natural gas
sales, net of royalties 31,200 42,453 (27) 111,623 135,622 (18)
Realized derivative loss on
commodity contracts (112) (2,430) 95 (1,041) (8,329) 88
Unrealized derivative gain
(loss) on commodity
contracts 2,616 (3,295) 179 (385) (20,157) 98
Production and operating
expense 11,564 12,242 (6) 35,507 40,182 (12)
Selling costs 76 527 (86) 649 1,653 (61)
General and administrative
expense 4,102 5,104 (20) 12,743 16,683 (24) )
Depletion, depreciation and
amortization expense 8,173 8,751 (7) 26,184 26,077 -
Income tax expense 6,416 6,924 (7) 20,095 19,728 2
Cash flow generated by
operating
activities 12,042 47,639 (75) 21,096 59,370 (64)
Funds flow from
operations(1) 9,429 17,018 (45) 43,700 54,440 (20)
Basic per share 0.13 0.24 0.60 0.75
Diluted per share 0.13 0.23 0.60 0.75
Net earnings (loss) 2,967 (12,283) (124) 4,207 (15,042) 128
Basic per share 0.04 (0.17) 0.06 (0.21)
Diluted per share 0.04 (0.17) 0.06 (0.21)
Capital expenditures 9,292 12,783 (27) 25,936 23,273 11
Dividends paid 2,539 2,527 - 5,078 2,527 101
Dividends paid per
share 0.035 0.035 - 0.035 - -
Working capital 47,150 52,351 (10) 47,150 52,351 (10)
Long-term debt, including
current portion 41,726 52,532 (21) 41,726 52,532 (21)
Common shares outstanding
Basic (weighted
average) 72,542 72,206 - 72,504 72,206 -
Diluted (weighted
average) 72,542 72,951 (1) 72,509 73,124 (1)
Total assets 312,654 314,203 - 312,654 314,203 -
---------------------------- ------- -------- -------- ------- -------- -----------------
Operating
---------------------------- ------- -------- -------- ------- -------- --------------------
Average production volumes
(boe/d) 15,943 14,331 11 16,269 14,161 15
Average sales volumes
(boe/d) 14,122 14,490 (3) 15,044 15,191 (1)
Inventory (mbbls) 902.6 495.6 82 902.6 495.6 82
Average price ($ per boe) 49.56 55.77 (11) 52.28 54.62 (4)
Operating expense ($ per
boe) 8.90 9.18 (3) 8.65 9.69 (11)
---------------------------- ------- -------- -------- ------- -------- -----------------
(1) Funds flow from operations (before finance costs) is a measure
that represents cash generated from operating activities before changes
in non-cash working capital and may not be
comparable to measures used by other companies. See "Non-GAAP Financial
Measures".
Average Reference Prices and Exchange 2019 2018
Rates
Q-3 Q-2 Q-1 Q-4 Q-3
------------------------------------------- ----- ----- ----- ----- -------
Crude oil
Dated Brent average oil price (US$/bbl) 61.93 68.92 63.17 67.71 75.22
Edmonton Sweet index (US$/bbl) 51.76 55.17 49.96 32.51 62.68
Natural gas
AECO (C$/mmbtu) 1.00 1.11 2.63 1.56 1.18
US/Canadian Dollar average exchange
rate 1.32 1.34 1.33 1.32 1.30
-------------------------------------------- ----- ----- ----- ----- -----
CORPORATE SUMMARY
TransGlobe Energy Corporation ("TransGlobe" or the "Company")
produced an average of 15,943 barrels of oil equivalent per day
("boe/d") during the third quarter of 2019. Egypt production was
13,750 barrels of oil per day ("bbls/d") and Canada production was
2,193 boe/d. Production for the quarter was within the full year
2019 guidance of between 15,500 to 16,000 boe/d and 6% lower than
the previous quarter, due to natural declines.
TransGlobe's Egyptian crude oil is sold at a quality discount to
Dated Brent. The Company received an average price of $54.58 per
barrel in Egypt during the quarter. In Canada, the Company received
an average of $49.94 per barrel of oil and $0.70 per thousand cubic
feet ("mcf") of natural gas during the quarter.
During the quarter, the Company had funds flow from operations
of $9.4 million and ended the quarter with positive working capital
of $47.2 million, including cash and cash equivalents of $24.4
million. The Company had net earnings in the quarter of $3.0
million, including a $2.6 million unrealized derivative gain on
commodity contracts which represents a fair value adjustment on the
Company's hedging contracts as at September 30, 2019.
In Egypt, the Company sold 380.4 thousand barrels ("mbbls") of
entitlement crude oil during the quarter and had 902.6 mbbls of
entitlement crude oil inventory at September 30, 2019. The increase
in inventoried crude oil is attributed to higher oil production
than forecasted in the first half of 2019 due to successful
drilling and well workover results. All Canadian production was
sold during the quarter.
The Company continued its negotiations in Egypt throughout the
quarter with the government to amend, extend and consolidate its
Eastern Desert operations.
In the Eastern Desert, the NWG 38D-1 exploration well drilled in
the second quarter of 2019 was completed, perforated, and is
currently producing oil to surface at a low rate, confirming the
well as an oil discovery in the Red Bed formation. NWG 38D-1 will
require stimulation in Q4-2019 prior to being put into full
production. Data recovered and analyzed from the well shows it in
pressure communication with the adjacent NWG 38A pool.
In the Western Desert, the SGZ-6X discovery well (tested at
3,840 bbls of light oil per day) was completed during the third
quarter of 2019 as an oil producer in the upper Bahariya formation.
Construction of an Early Production Facility ("EPF") in South
Ghazalat is on schedule, from which oil will be transported to the
nearby South Dabaa receiving facility and onwards via existing
pipeline infrastructure to market. First oil is expected late in
Q4-2019. Concurrently, the Company has submitted permits and is
sourcing a drilling rig to drill an appraisal well in the SGZ-6X
pool during Q4-2019 which, if successful, will be completed and
connected to the new South Ghazalat EPF. In addition, a project to
merge and reprocess two existing 3D seismic surveys over the
development lease area will also be completed in Q4-2019.
In Canada, the Company drilled and cased three Cardium
development oil wells (one mile horizontal wells) in the Harmattan
area and one Cardium outpost appraisal well (two mile horizontal
well) in the South Harmattan area which completed the 2019 drilling
program. Subsequent to the quarter, the four horizontal wells have
been completed and stimulated and are being equipped for
production.
The Company paid a dividend of $0.035 per share on September 13,
2019 to shareholders of record on August 30, 2019.
STRATEGY UPDATE
The Company's management and board held its annual strategy
session in early October, and reconfirmed its commitment to growth
through material cash generative mergers and acquisitions to build
significantly greater scale, profitability, and long-term
sustainability within the next three to five years. To achieve
these growth ambitions, the Company intends to leverage its
operating and financial capabilities as well as its unique position
as a recognized partner of choice in the region, and is actively
assessing several opportunities.
OPERATIONS UPDATE
ARAB REPUBLIC OF EGYPT
EASTERN DESERT
West Gharib, West Bakr, and North West Gharib (100% working
interest, operated)
Operations and Exploration
During the third quarter of 2019, the Company completed and
perforated the NWG 38D-1 exploration well drilled in the second
quarter of 2019. This well is currently producing oil to the
surface at a low rate, confirming the well as an oil discovery in
the Red Bed formation. NWG 38D-1 will require stimulation, similar
to NWG 38A-1, in Q4-2019 prior to being put into full production.
Data recovered and analyzed from the well shows it in pressure
communication with the adjacent NWG 38A pool. While encouraging,
any potential for additional drilling and reserves additions will
be assessed following stimulation and production of the well.
Production
Production averaged 13,750 bbls/d during the quarter, a decrease
of 6% (913 bbls/d) from the previous quarter. This decrease is
primarily due to natural declines, the completion of the 2019
Eastern Desert drilling program in the second quarter, and pressure
management of the shared M-pool, consistent with production
guidance for fiscal 2019 of 15,500 to 16,000 boe/d.
Production to date in October averaged 13,228 bbls/d.
Sales
The Company sold 380.4 mbbls of inventoried entitlement crude
oil to EGPC during the quarter.
Quarterly Eastern Desert Production
(bbls/d) 2019 2018
Q-3 Q-2 Q-1 Q-4
----------------------------------------------- --------- ------- ------- ---------
Gross production rate(1) 13,750 14,663 13,616 12,970
TransGlobe production (inventoried)
sold (1,821) (967) (877) (787)
------- -------
Total sales 11,929 13,696 12,739 12,183
------------------------------------------------ --------- ------- ------- -------
Government share (royalties
and tax) 7,795 8,320 7,711 7,292
TransGlobe sales (after royalties
and tax)(2) 4,134 5,376 5,028 4,891
------------------------------------------------ --------- ------- -------
Total sales 11,929 13,696 12,739 12,183
------------------------------------------------ --------- ------- ------- -------
(1) Quarterly production by concession (bbls/d):
West Gharib - 4,003 (Q3-2019), 4,256 (Q2-2019), 4,238 (Q1-2019),
and 4,512 (Q4-2018)
West Bakr - 8,978 (Q3-2019), 9,389 (Q2-2019), 8,132 (Q1-2019), and
7,323 (Q4-2018)
North West Gharib - 769 (Q3-2019), 1,018 (Q2-2019), 1,246 (Q1-2019),
and 1,135 (Q4-2018)
(2) Under the terms of the Production Sharing Concession Agreements,
royalties and taxes are paid out of the Government's share of production
sharing oil.
WESTERN DESERT
South Ghazalat (100% working interest, operated)
Operations and Exploration
At South Ghazalat, the SGZ-6X discovery well (tested at 3,840
bbls of light oil per day) was completed during the third quarter
of 2019 as an oil producer in the upper Bahariya formation.
Construction of an Early Production Facility ("EPF") is on
schedule, from which oil will be transported to the nearby South
Dabaa receiving facility and onwards via existing pipeline
infrastructure to market. The first oil is expected late in
Q4-2019.
Concurrently, the Company submitted permits and is sourcing a
drilling rig to drill an appraisal well in SGZ-6X pool during
Q4-2019, which if successful, will be completed and connected to
the new South Ghazalat EPF. In addition, a project to merge and
reprocess two existing 3D seismic surveys over the development
lease area is also expected to be completed in Q4-2019.
CANADA
Operations and Exploration
During the quarter, the Company drilled and cased three Cardium
development oil wells (one-mile horizontal wells) in the Harmattan
area and one Cardium outpost appraisal well (two-mile horizontal
well) in the South Harmattan area, which completed the 2019
drilling program. Subsequent to the quarter, the four horizontal
wells have been completed and stimulated (approximately 40 stages
per mile) and are being equipped for production.
Production
In Canada, oil production averaged 666 bbls/d during the
quarter, a decrease of 122 bbls/d (15%) from the previous quarter,
primarily due to natural declines. Total Q3-2019 production was 4%
(84 boe/d) lower than the previous quarter.
Production to date averaged 1,978 boe/d in October with 586
bbls/d of oil.
Quarterly Canada Production
(boe/d) 2019 2018
Q-3 Q-2 Q-1 Q-4
------------------------------ ----- ----- ----- -------
Canada crude oil (bbls/d) 666 788 894 495
Canada NGLs (bbls/d) 585 533 470 829
Canada natural gas (mcf/d) 5,652 5,733 5,663 5,865
-----
Total production (boe/d) 2,193 2,277 2,308 2,302
------------------------------- ----- ----- ----- -----
Condensed Consolidated Interim Statements of Earnings (Loss) and
Comprehensive Income (Loss)
(Unaudited - Expressed in thousands of US Dollars, except per
share amounts)
Three Months Ended Nine Months Ended
September 30 September 30
2019 2018 2019 2018
------------------------------------------------ --------- --------- -------- -----------
REVENUE
Petroleum and natural gas sales,
net of royalties 31,200 42,453 111,623 135,622
Finance revenue 85 180 401 399
31,285 42,633 112,024 136,021
------------------------------------------------ --------- --------- -------- --------
EXPENSES
Production and operating 11,564 12,242 35,507 40,182
Selling costs 76 527 649 1,653
General and administrative 4,102 5,104 12,743 16,683
Foreign exchange (gain) loss (67) 216 (122) 195
Finance costs 1,030 1,222 3,311 3,923
Depletion, depreciation and amortization 8,173 8,751 26,184 26,077
Asset retirement obligation accretion 51 72 156 205
(Gain) loss on financial instruments (2,504) 5,725 1,426 28,486
Impairment (recovery) loss (409) 14,138 7,982 14,138
Gain on disposition of assets (114) (5) (114) (207)
21,902 47,992 87,722 131,335
------------------------------------------------ --------- --------- -------- --------
Net earnings (loss) before income
taxes 9,383 (5,359) 24,302 4,686
Income tax expense - current 6,416 6,924 20,095 19,728
------------------------------------------------- --------- --------- -------- --------
NET EARNINGS (LOSS) FOR THE PERIOD 2,967 (12,283) 4,207 (15,042)
------------------------------------------------- --------- --------- -------- --------
OTHER COMPREHENSIVE INCOME (LOSS)
Currency translation adjustments (410) 1,000 1,250 (679)
------------------------------------------------- --------- --------- -------- --------
COMPREHENSIVE INCOME (LOSS) FOR
THE PERIOD 2,557 (11,283) 5,457 (15,721)
------------------------------------------------- --------- --------- -------- --------
Net earnings (loss) per share
Basic 0.04 (0.17) 0.06 (0.21)
Diluted 0.04 (0.17) 0.06 (0.21))
------------------------------------------------- --------- --------- -------- --------
Condensed Consolidated Interim Balance Sheets
(Unaudited - Expressed in thousands of US Dollars)
As at As at
September 30, December 31,
2019 2018
---------------------------------------------------- ------------- --------------
ASSETS
Current
Cash and cash equivalents 24,444 51,705
Accounts receivable 24,844 12,014
Derivative commodity contracts 740 1,198
Prepaids and other 4,033 5,385
Product inventory 17,342 8,692
----------------------------------------------------- ------------- -----------
71,403 78,994
Non-Current
Derivative commodity contracts 243 171
Intangible exploration and evaluation assets 29,128 36,266
Property and equipment
Petroleum and natural gas assets 197,941 195,263
Other assets 4,225 3,079
Deferred taxes 9,714 4,523
----------------------------------------------------- ------------- -----------
312,654 318,296
---------------------------------------------------- ------------- -----------
LIABILITIES
Current
Accounts payable and accrued liabilities 22,963 28,007
Current portion of lease obligations 1,290 -
24,253 28,007
Non-Current
Long-term debt 41,726 52,355
Asset retirement obligation 13,938 12,113
Other long-term liabilities 447 1,007
Lease obligations 865 -
Deferred taxes 9,714 4,523
----------------------------------------------------- ------------- -----------
90,943 98,005
---------------------------------------------------- ------------- -----------
SHAREHOLDERS' EQUITY
Share capital 152,805 152,084
Accumulated other comprehensive income
(loss) 311 (939)
Contributed surplus 24,515 24,195
Retained earnings 44,080 44,951
----------------------------------------------------- ------------- -----------
221,711 220,291
---------------------------------------------------- ------------- -----------
312,654 318,296
---------------------------------------------------- ------------- -----------
Condensed Consolidated Interim Statements of Changes in
Shareholders' Equity
(Unaudited - Expressed in thousands of US Dollars)
Three Months
Ended Nine Months Ended
September 30 September 30
2019 2018 2019 2018
--------------------------------------------- -------- -------- --------- ----------
Share Capital
Balance, beginning of period 152,805 152,084 152,084 152,084
Stock options exercised - - 547 -
Transfer from contributed surplus on
exercise of options - - 174 -
Balance, end of period 152,805 152,084 152,805 152,084
---------------------------------------------- ------- ------- -------- -------
Accumulated Other Comprehensive Income
(Loss)
Balance, beginning of period 721 1,114 (939) 2,793
Currency translation adjustment (410) 1,000 1,250 (679)
--------
Balance, end of period 311 2,114 311 2,114
---------------------------------------------- ------- ------- -------- -------
Contributed Surplus
Balance, beginning of period 24,358 23,828 24,195 23,329
Share-based compensation expense 157 164 494 663
Transfer to share capital on exercise
of options - - (174) -
Balance, end of period 24,515 23,992 24,515 23,992
---------------------------------------------- ------- ------- -------- -------
Retained Earnings
Balance, beginning of period 43,652 29,042 44,951 31,801
Net earnings (loss) 2,967 (12,283) 4,207 (15,042)
Dividends (2,539) (2,527) (5,078) (2,527)
Balance, end of period 44,080 14,232 44,080 14,232
---------------------------------------------- ------- ------- -------- -------
Condensed Consolidated Interim Statements of Cash Flows
(Unaudited - Expressed in thousands of US Dollars)
Three Months Nine Months
Ended Ended
September 30 September 30
2019 2018 2019 2018
-------------------------------------------------------- -------- -------- -------- ----------
OPERATING
Net earnings (loss) 2,967 (12,283) 4,207 (15,042)
Adjustments for:
Depletion, depreciation and amortization 8,173 8,751 26,184 26,077
Asset retirement obligation accretion 51 72 156 205
Deferred lease inducement - (23) - (68)
Impairment (recovery) loss (409) 14,138 7,982 14,138
Share-based compensation 406 1,624 1,749 5,309
Finance costs 1,030 1,222 3,311 3,923
Unrealized (gain) loss on financial
instruments (2,616) 3,295 385 20,157
Unrealized (gain) loss on foreign
currency translation (49) 227 (119) 205
Gain on asset dispositions (114) (5) (114) (207)
Asset retirement obligations settled (10) - (41) (257)
Changes in non-cash working capital 2,613 30,621 (22,604) 4,930
--------------------------------------------------------- ------- ------- ------- -------
Net cash generated by operating activities 12,042 47,639 21,096 59,370
--------------------------------------------------------- ------- ------- ------- -------
INVESTING
Additions to intangible exploration
and evaluation assets (56) (5,455) (844) (7,036)
Additions to petroleum and natural
gas assets (9,197) (7,185) (24,621) (15,859)
Additions to other assets (39) (143) (471) (378)
Proceeds from asset dispositions 114 5 114 207
Changes in non-cash working capital (2,177) 3,229 (2,478) 2,594
--------------------------------------------------------- ------- ------- ------- -------
Net cash used in investing activities (11,355) (9,549) (28,300) (20,472)
--------------------------------------------------------- ------- ------- ------- -------
FINANCING
Issue of common shares for cash - - 547 -
Interest paid (893) (1,233) (2,874) (3,714)
Increase in long-term debt 114 146 370 395
Payments on lease obligations (540) - (1,430) -
Repayments of long-term debt (6,523) (10,000) (11,523) (17,797)
Dividends paid (2,539) (2,527) (5,078) (2,527)
Changes in non-cash working capital - (3) (200) (3)
------- -------
Net cash used in financing activities (10,381) (13,617) (20,188) (23,646)
--------------------------------------------------------- ------- ------- ------- -------
Currency translation differences relating to
cash and cash equivalents 13 102 131 (38)
--------------------------------------------------------- ------- ------- ------- -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (9,681) 24,575 (27,261) 15,214
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD 34,125 38,088 51,705 47,449
CASH AND CASH EQUIVALENTS, OF PERIOD 24,444 62,663 24,444 62,663
--------------------------------------------------------- ------- ------- ------- -------
Advisory on Forward-Looking Statements
Certain statements included in this news release constitute
forward-looking statements or forward-looking information under
applicable securities legislation. Such forward-looking statements
or information are provided for the purpose of providing
information about management's current expectations and plans
relating to the future. Readers are cautioned that reliance on such
information may not be appropriate for other purposes.
Forward-looking statements or information typically contain
statements with words such as "anticipate", "believe", "expect",
"plan", "intend", "estimate", "may", "will", "would" or similar
words suggesting future outcomes or statements regarding an
outlook.
In particular, forward-looking information and statements
contained in this document include, but are not limited to,
statements relating to "reserves" which are, by their nature,
forward-looking statements, as they involve the implied assessment,
based on certain estimates and assumptions that the reserves or
resources, as applicable, described exist in the quantities
predicted or estimated and that the reserves can be profitably
produced in the future. The recovery and reserve estimates of
TransGlobe's reserves provided herein are estimates only and there
is no guarantee that the estimated reserves will be recovered.
Forward-looking statements or information are based on a number of
factors and assumptions which have been used to develop such
statements and information but which may prove to be incorrect.
Although the Company believes that the expectations reflected in
such forward-looking statements or information are reasonable,
undue reliance should not be placed on forward-looking statements
because the Company can give no assurance that such expectations
will prove to be correct. Many factors could cause TransGlobe's
actual results to differ materially from those expressed or implied
in any forward-looking statements made by, or on behalf of,
TransGlobe.
Forward-looking information and statements contained in this
document include the payment of dividends, including the timing and
amount thereof, and the Company's intention to declare and pay
dividends in the future under its current dividend policy. Without
limitation of the foregoing, future dividend payments, if any, and
the level thereof is uncertain, as the Company's dividend policy
and the funds available for the payment of dividends from time to
time will be dependent upon, among other things, free cash flow,
financial requirements for the Company's operations and the
execution of its strategy, ongoing production maintenance, growth
through acquisitions, fluctuations in working capital and the
timing and amount of capital expenditures and anticipated business
development capital, payment irregularity in Egypt, debt service
requirements and other factors beyond the Company's control.
Further, the ability of the Company to pay dividends will be
subject to applicable laws (including the satisfaction of the
liquidity and solvency tests contained in applicable corporate
legislation) and contractual restrictions contained in the
instruments governing its indebtedness.
In addition to other factors and assumptions which may be
identified in this news release, assumptions have been made
regarding, among other things, anticipated production volumes; the
timing of drilling wells and mobilizing drilling rigs; the number
of wells to be drilled; the Company's ability to obtain qualified
staff and equipment in a timely and cost-efficient manner; the
regulatory framework governing royalties, taxes and environmental
matters in the jurisdictions in which the Company conducts and will
conduct its business; future capital expenditures to be made by the
Company; future sources of funding for the Company's capital
programs; geological and engineering estimates in respect of the
Company's reserves and resources; the geography of the areas in
which the Company is conducting exploration and development
activities; current commodity prices and royalty regimes;
availability of skilled labour; future exchange rates; the price of
oil; the impact of increasing competition; conditions in general
economic and financial markets; availability of drilling and
related equipment; effects of regulation by governmental agencies;
future operating costs; uninterrupted access to areas of
TransGlobe's operations and infrastructure; recoverability of
reserves and future production rates; that TransGlobe will have
sufficient cash flow, debt or equity sources or other financial
resources required to fund its capital and operating expenditures
and requirements as needed; that TransGlobe's conduct and results
of operations will be consistent with its expectations; that
TransGlobe will have the ability to develop its properties in the
manner currently contemplated; current or, where applicable,
proposed industry conditions, laws and regulations will continue in
effect or as anticipated as described herein; that the estimates of
TransGlobe's reserves and resource volumes and the assumptions
related thereto (including commodity prices and development costs)
are accurate in all material respects; and other matters.
Forward-looking statements or information are based on current
expectations, estimates and projections that involve a number of
risks and uncertainties which could cause actual results to differ
materially from those anticipated by the Company and described in
the forward-looking statements or information. These risks and
uncertainties which may cause actual results to differ materially
from the forward-looking statements or information include, among
other things, operating and/or drilling costs are higher than
anticipated; unforeseen changes in the rate of production from
TransGlobe's oil and gas properties; changes in price of crude oil
and natural gas; adverse technical factors associated with
exploration, development, production or transportation of
TransGlobe's crude oil reserves; changes or disruptions in the
political or fiscal regimes in TransGlobe's areas of activity;
changes in tax, energy or other laws or regulations; changes in
significant capital expenditures; delays or disruptions in
production due to shortages of skilled manpower equipment or
materials; economic fluctuations; competition; lack of availability
of qualified personnel; the results of exploration and development
drilling and related activities; obtaining required approvals of
regulatory authorities; volatility in market prices for oil;
fluctuations in foreign exchange or interest rates; environmental
risks; ability to access sufficient capital from internal and
external sources; failure of counterparties to perform under the
terms of their contracts; and other factors beyond the Company's
control. Readers are cautioned that the foregoing list of factors
is not exhaustive. Please consult TransGlobe's public filings at
www.sedar.com and www.sec.gov/edgar.shtml for further, more
detailed information concerning these matters, including additional
risks related to TransGlobe's business.
The forward-looking statements or information contained in this
news release are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise unless required by
applicable securities laws. The forward-looking statements or
information contained in this news release are expressly qualified
by this cautionary statement.
Oil and Gas Advisories
Mr. Darrin Drall, P.Eng., - Manager Engineering for TransGlobe
Energy Corporation, and a qualified person as defined in the
Guidance Note for Mining, Oil and Gas Companies, June 2009, of the
London Stock Exchange, has reviewed and approved the technical
information contained in this announcement. Mr. Drall obtained a
Bachelor of Science Degree in Engineering from the University of
Manitoba. He is a Registered Professional Engineer in the province
of Alberta (Association of Professional Engineers and Geoscientists
of Alberta) and in the province of Saskatchewan (Association of
Professional Engineers and Geoscientists of Saskatchewan) and has
over 30 years' experience in oil and gas.
BOEs may be misleading, particularly if used in isolation. A BOE
conversion ratio of six thousand cubic feet of natural gas to one
barrel of oil equivalent (6 mcf: 1 bbl) is based on an energy
equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.
Given that the value ratio based on the current price of crude oil
as compared to natural gas is significantly different from the
energy equivalency of 6:1, utilizing a conversion on a 6:1 basis
may be misleading as an indication of value.
References in this press release to production test rates, are
useful in confirming the presence of hydrocarbons, however such
rates are not determinative of the rates at which such wells will
commence production and decline thereafter and are not indicative
of long term performance or of ultimate recovery. While
encouraging, readers are cautioned not to place reliance on such
rates in calculating the aggregate production for TransGlobe. A
pressure transient analysis or well-test interpretation has not
been carried out in respect of all wells. Accordingly, the Company
cautions that the production test results should be considered to
be preliminary.
The following abbreviations used in this press release have the
meanings set forth below:
Bopd barrels of oil per day
MBopd thousand barrels of oil per day
Boepd barrels of oil equivalent per day
MBoepd thousand barrels of oil equivalent per day
MBbl thousand barrels
For further information, please contact:
Investor Relations
Telephone: +1 (403) 264-9888
Email: investor.relations@trans-globe.com
Web site: http://www.trans-globe.com
TransGlobe Energy Via FTI Consulting
Randy Neely, President & Chief Executive
Officer
Eddie Ok, Vice President & Chief Financial
Officer
Canaccord Genuity (Nomad & Joint Broker) + 44 0 20 7523 8000
Henry Fitzgerald-O'Connor
James Asensio
GMP First Energy (Joint Broker) + 44 0 20 7448 0200
Jonathan Wright
FTI Consulting (Financial PR) + 44 0 20 3727 1000
Ben Brewerton transglobeenergy@fticonsulting.com
Genevieve Ryan
nr-fin
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
QRTDMMFGVGKGLZG
(END) Dow Jones Newswires
October 30, 2019 03:00 ET (07:00 GMT)
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