First quarter ended 31 March 2018 (First quarter ended 31 March 2017)
| First |
| Fourth |
| First |
| Twelve |
|Gross crude oil production, bbl||28,621||30,363||29,897||127,080|
|Gross gas and natural liquids production, mcf||145,530||173,536||173,734||707,543|
|Net crude oil production, bbl||23,375||24,325||25,670||103,714|
|Net gas and natural liquids production, mcf||110,190||125,896||130,147||523,251|
|Average selling price oil, USD/bbl||59.71||51.86||48.70||47.53|
|Average selling price gas USD/mcf||7.13||8.14||6.51||6.78|
|Result for the period||-2,098||-2,110||-1,303||-7,126|
|Earnings per share (basic and diluted), USD||-0.05||-0.05||-0.04||-0.18|
In the first quarter, the main events were that we secured the financing for an accelerated drilling program in 2018 and the principal agreement on acquisition of additional oil and gas reserves and production in our operating region. These events allow us to set our objective at doubling daily oil and gas production by the end of the year.
We plan to increase capital expenditures to MUSD 11 (2017: MUSD 5.2) and accelerate drilling and development activities on the company's leases in the Texas Panhandle. In the coming months, the company plans to drill 24 new wells to increase oil and gas production. In addition, an extensive program to improve oil and gas production from existing wells through workovers and reopening of shut-in wells has started.
We are also in the process of completing the acquisition of 40 oil and gas leases in the Texas Panhandle from Melody Capital Partners LP. Through the acquisition, we are adding proven reserves of 4 million barrels of oil equivalent, from which approximately 115 boe per day were produced in March 2018.
Melody is an important financial partner to Matra and we are extending our cooperation as Melody is providing additional debt financing for our drilling program and becoming a major shareholder in Matra through the acquisition.
In the first quarter 2018, severe winter conditions in Northern Texas continued to affect flow lines and compressors which held back production. We also had to face a short notice maintenance shutdown of the gas plant that processes our gas, which meant that gas production was halted for two weeks in March. Higher realized oil and gas prices compensated for lower production volumes resulting in revenues increasing slightly from the fourth quarter 2017 and in line with Q1 2017.
EBITDA and results were lower primarily due to the lower production volumes which resulted in higher production costs per barrel of oil equivalent produced and hedging losses. Despite this, Cash flow from operations was positive and improved from the fourth quarter 2017.
The harsh winter is behind us. We have started drilling the first well in this years' program, we are opening up previously shut-in wells and the workover program is well under way. As a result, oil and gas production increased to 680 boepd in April, up 16% from Q1. Upon closing of the pending acquisition, additional barrels will be added.
Increased production and higher oil prices support revenue, cash flow and earnings. Being a low cost producer of conventional oil and gas, Matra has significant operating leverage to improve financial performance as production continues to increase. We are committed to doubling daily production rates by the end of the year and look forward to updating you on the performance on the way there.
23 May 2018
Chief Executive Officer
This report has not been subject to review by the auditors of the Company.
For more information, please contact:
Maxim Barskiy, CEO, Matra Petroleum AB (publ)
Phone number: +46 8 611 49 95
Mangold Fondkommission AB is the Company's Certified Adviser.
Telephone: +46 (0) 85 03 01 550
Matra Petroleum AB (publ) | Eriksbergsgatan 10 | Box 7292 | 115 22 Stockholm
Telephone: +46 (0)8-611 4995 | web: www.matrapetroleum.com | Email: firstname.lastname@example.org
This information is information that Matra Petroleum AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact person set out above, at 8:30 CET on 23 May 2018.
Matra Petroleum AB (publ) is a Swedish independent oil and gas exploration and production company operating in the United States, where the company owns and operates 130 leases, covering an area of 38,140 net acres in the Panhandle region in Texas. Matra's proved oil and gas reserves amount to 21.0 million barrels of oil equivalent. Matra Petroleum's shares are traded on NASDAQ First North in Sweden under the symbol MATRA. Mangold Fondkommission AB is Certified Adviser (www.mangold.se).