CALGARY, AB, May 4, 2021 /CNW/ - Tamarack Valley Energy Ltd. (Tamarack or the Company) is pleased to announce its financial and operating results for the three months ended March 31, 2021. Selected financial and operational information is outlined below and should be read in conjunction with Tamarack's unaudited condensed consolidated interim financial statements for the three months ended March 31, 2021 and related management's discussion and analysis (MD&A) which are available on SEDAR at www.sedar.com and on Tamarack's website at www.tamarackvalley.ca.
Brian Schmidt, President and CEO of Tamarack commented: We are proud to report another very strong quarter driven by the effective execution of our drilling program and integration of the Clearwater acquisitions. The Company exceeded our Clearwater winter drilling program exit production expectations with volumes greater than 4,000 bbl/d(1). Furthermore, we continued to deliver on our strategy of enhancing the sustainability and resilience of our free adjusted funds flow(2) with the closing of the Greater Nipisi and Provost acquisitions on March 25th, which added ~2,800 boe/d(3) of low decline oil production under waterflood and grew our highly economic Clearwater oil inventory. These transactions, combined with our recently announced Anegada Oil Corp. acquisition continue to drive down our sustaining free adjusted funds flow breakeven price(2) to the mid US$30/bbl, while offering significant upside to shareholders through a sector leading total return profile. In addition, we remain focused on advancing the 2021 initiatives and targets set within our robust environmental, social and governance (ESG) reporting.
Q1 2021 Financial and Operating Highlights
- Closed two separate agreements in March 2021 to acquire assets in the Greater Nipisi and Provost areas of Alberta, including approximately 2,800 boe/d(3) of low decline (~16%) oil weighted assets under waterflood and approximately 38,400 net acres in the Clearwater oil play of Alberta for a net cash purchase price of approximately $121 million. These acquisitions were financed through a combination of debt, a $68.2 million bought deal financing (30.3 million common shares at $2.25 per share) and a gross overriding royalty (GORR) disposition on the newly acquired Greater Nipisi Clearwater and Slave Point lands for proceeds of approximately $13.5 million.
- Achieved quarterly production of 23,938 boe/d in Q1/21, a 2% increase over the same period in 2020.
- Generated adjusted funds flow(2) of $41.2 million in Q1/21 ($0.16 per share basic and diluted).
- Invested $48.7 million in exploration and development (E&D) capital expenditures, excluding acquisitions, during Q1/21, which contributed to the drilling of 44 (42.3 net) wells, comprised of 22 (22.0 net) Viking oil wells, 16 (15.5 net) Clearwater oil wells, two (0.8 net) Falher gas wells and four (4.0 net) water source and injector wells. The Company continued to direct significant capital to our Viking waterflood program which represented approximately 34% of the total E&D capital expenditures.
- Successfully executed on our Viking waterflood program, with first quarter production exit volumes of approximately 2,540 bbls/d of light oil, delivering 91% growth on Q1/21 average volumes versus Q1/20.