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ALBERTA OILSANDS INC. Attention Business/Financial Editors
Alberta Oilsands Inc. Announces First Quarter Results and Operations Update
§ /NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN
§ THE U.S./
§ CALGARY, June 2 /CNW/ - Alberta Oilsands Inc. (the "Company" or "AOS") (TSXV: AOS) is pleased to announce the financial highlights of the three months ended March 31, 2008.
§ <<
§ Highlights
§ - Pursuant to a private placement, the Company received net proceeds of
§ $8.0 million in the first quarter of 2008, increasing the total
§ equity raised to $33.1 million over the previous 15 months
§ - Signed a pooling agreement in Hangingstone East that increased gross
§ leases from 23 sections to 38.5 sections (19.5 sections net)
§ - Drilled 34 core holes and acquired 89 kilometers of 2D seismic -
§ Identified two possible bitumen production projects based on its
§ winter drilling program at Clearwater
§ - Exited the first quarter of 2008 with working capital of $9.5 million
§ Oil Sands Operations:
§ Fort McMurray - Clearwater East and West Projects
§ - Received approval from Alberta Sustainable Resource Development
§ (ASRD) to core up to 26 core holes in the Clearwater East project and
§ 19 core holes in the Clearwater West project. 15 core holes were
§ drilled over 5 of the 28 sections in the first quarter of 2008, and
§ encountered up to 50 metres of gross bitumen pay with excellent
§ bitumen saturation, porosity and permeability.
§ Hangingstone East
§ - Entered into a pooling agreement whereby our 23 sections and their
§ 15.5 sections in the adjacent Halfway Creek properties were pooled
§ into a joint ownership agreement. This resulted in our Company owning
§ a 50% working interest in a 38.5 section contiguous land block
§ - Our 2007/2008 winter exploration program included the acquisition
§ of 89 kilometres of 2D seismic and the completion of a 19 core hole
§ drilling program designed to identify the channel sands. This program
§ confirmed the presence of bitumen in the area and the possibility of
§ two significant north-south bitumen channels.
§ First Quarter Operating Highlights
§ The following table outlines certain highlights of our financial and operating results for the three months ended March 31, 2008:
§ Three months ended March 31
§ -----------------------------
§ 2008 2007
§ --------------------------------------------------
§ Petroleum and natural gas sales 444,336 1,519,356
§ Funds from (used in) operations (267,248) 605,332
§ Loss for the period (780,434) 1,315,540
§ Capital expenditures 5,893,011 3,769,082
§ Three months ended March 31
§ -----------------------------
§ 2008 2007
§ --------------------------------------------------
§ Oil and NGL (bbls/day) 50 258
§ Natural gas (mcf/day) 47 52
§ boe(1)/day 58 267
§ Three months ended March 31
§ -----------------------------
§ 2008 2007
§ --------------------------------------------------
§ Commodity Prices
§ Oil and NGL ($/bbl) 91.87 65.77
§ Natural gas ($/mcf) 7.79 6.73
§ $/boe(1) 85.74 63.30
§ (1) See "BOE Presentation" below.
§ >>
§ Outlook
§ Fiscal 2008 has started with three successful drilling programs. Our 15 core holes at Clearwater East and West projects encountered 15 to 50 metres of gross bitumen pay in the McMurray formation. We believe from the preliminary data that we may have two possible 10,000 barrel a day projects in the Clearwater area. The 19 core holes in Hangingstone East/Halfway Creek confirmed the presence of bitumen and suggest further delineation is required to locate the channels.
§ Our objectives for 2008 are to pursue the goal of bringing the Clearwater potential project to production in 2011 / 2012 and to advance our Hangingstone project with our partner in the area.
§ The Company will file its first quarter management's discussion and analysis and interim unaudited consolidated financial statements and notes thereto as at and for the three months ended March 31, 2008 in accordance with National Instrument 51-102 - Continuous Disclosure Obligations adopted by the Canadian securities regulatory authorities. Additional information about the Company, including the audited consolidated financial statements and notes thereto and management's discussion and analysis as at and for the year ended December 31, 2007, are available on the Company's SEDAR profile at www.sedar.com.
§ BOE Presentation - Production information is commonly reported in units of barrel of oil equivalent ("boe"). For purposes of computing such units, natural gas is converted to equivalent barrels of oil using a conversion factor of six thousand cubic feet to one barrel of oil. This conversion ratio of 6:1 is based on an energy equivalent wellhead value for the individual products. Such disclosure of boes may be misleading, particularly if used in isolation. Readers should be aware that historical results are not necessarily indicative of future performance.
§ Undiscovered Resource - In accordance with the Canadian Standards set out in the Canadian Oil and Gas Evaluation Handbook (COGEH) and National Instrument 51-101 (NI 51-101) and per the Canadian Securities Administrators (CSA) Staff Notice 51-321, "Undiscovered Resources" are those quantities of oil and gas estimated on a given date to be contained in accumulations yet to be discovered. There is no certainty that any portion of the undiscovered resources will be discovered and that, if discovered, it may not be economically viable or technically feasible to produce. "Discovered Resources" are those quantities of oil and gas estimated on a given date to be remaining in, plus those quantities already produced from, known accumulations. Discovered resources are divided into economic and uneconomic categories, with the estimated future recoverable portion classified as reserves and contingent resources, respectively. There is no certainty that any portion of the discovered resources will be economically viable or technically feasible to produce. "Contingent Resources" are those quantities of oil and gas estimated on a given date to be potentially recoverable from known accumulations, but are not currently economic.
§ Forward-Looking Statements: This press release contains certain "forward-looking statements" within the meaning of such statements under applicable securities law including management's assessment of the Company's properties, production and prospects. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking statements 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 projected in the forward-looking statements. These factors include the inherent risks involved in the exploration and development of oil sands properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating oil prices, the possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future and other factors including unforeseen delays. As an oil sands focused enterprise, the Company faces risks, including those associated with exploration, development, approvals and the ability to access sufficient capital from external sources. Anticipated exploration and development plans relating to the Company's properties are subject to change. For a detailed description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's annual financial statements and management discussion and analysis for the year ended December 31, 2006, both of which are available at www.sedar.com. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on forward-looking statements.
§ The TSX Venture Exchange has not reviewed and does not accept
§ responsibility for the adequacy and accuracy of this release.
§ Not for dissemination in the United States of America. This news release shall not constitute an offer to sell or the solicitation of any offer to buy securities of the Company in any jurisdiction, including the United States. The common shares of the Company have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and have not been and will not be offered or sold in the United States or to any U.S. person except in certain transactions exempt from the registration requirements of the U.S. Securities Act and applicable state securities laws.
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§ /For further information: Alberta Oilsands Inc., Suite 2800, 350 - 7th Avenue S.W., Calgary, Alberta, T2P 3N9, Shabir Premji, Executive Chairman, T: (403) 232-3341, F: (403) 263-6702, spremji@aboilsands.ca; or Chad Dust, Executive Vice-President, T: (403) 538-3191, cdust@aboilsands.ca; Company website: www.aboilsands.ca/ |