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Oando Energy Resources announces Q3 2015 results

Oando Energy Resources Inc. (“OER” or the “Company”) (TSX: OER), a company focused on oil and gas exploration and production in Nigeria, today announced financial and operating results for the three and nine months ended September 30, 2015.

The unaudited consolidated financial statements, notes and management’s discussion and analysis pertaining to the period are available on the System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com and by visiting www.oandoenergyresources.com. All monetary figures reported herein are U.S. dollars unless otherwise stated.

“In the face of lower and increasingly volatile crude oil prices, we continue to carefully manage costs and execute low Capex activity that optimize our overall production base whilst benefiting from our hedging strategies,” said Pade Durotoye, CEO of Oando Energy Resources Inc. “Despite the unfortunate operational incidents that temporarily impacted production in July, Oando delivered total production levels of 4.9 MMboe, an average production level of 53,169 boe/day thanks to quick bypass and recovery systems executed by the Operator and our diverse portfolio of producing assets. We remain committed to working with our joint venture partners to further consolidate the assets we acquired last year and optimize production, whilst also continuing to implement cost reduction strategies and prudently manage our balance sheet.”

Key Financial and Operational Highlights In the third quarter of 2015 production increased to 4.9 MMboe (average 53,169 boe/day) from 3.2 MMboe (average 35,307 boe/day) in the third quarter of 2014. During the nine months ended September 30, 2015 production increased to 15.1 MMboe, compared with 4.1 MMboe in the same period of 2014. The increase between the 2015 and 2014 year-to-date periods is primarily the result of the Nigerian onshore and offshore assets acquired on July 30, 2014 from the ConocoPhillips Company (“COP Acquisition”) that included substantial production from OMLs 60 to 63, significant reserves and resources, and a considerable base of development and exploration opportunities. Third quarter 2015 production was a slight decrease from 5.2 MMboe (average 56,917 boe/day) achieved in the second quarter of 2015. Crude oil production increased by 0.2MMboe, however the net decrease was attributed to a 0.5MMboe reduction in natural gas and NGL production (caused by the Ebocha Flowstation incident).

Net revenue was $132.5 million in the third quarter of 2015, a decrease of $52.3 million from $184.8 million generated in the third quarter of 2014, resulting from the significant decrease in crude oil prices, which was partially offset by the production increase between the periods. During the nine months ended September 30, 2015 revenues increased to $355.2 from $247.4 million in the same period of 2014, primary as a result of the acquisition of the COP producing assets, offset by declines in crude oil sales prices. Revenues in the third quarter 2015 increased $42.3 million from $90.2 million realized in the second quarter of 2015. The quarter to quarter increase was mainly the result of a portion of second quarter production not being sold until early July 2015(with a market value of $23.6 million) to accommodate changes to customer lifting schedules.

The Corporation has hedged 9,689 bbls/day of crude oil production at $65/bbl (average) with expiries ranging from July 2017 toJuly 2019 and further upside if certain price targets are met. The hedges represented 43% of third quarter production rates of crude oil.

Source : energymixreport.com/
Posted On: 10/26/2015 12:00:00 AM

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