15:48:02 EDT Thu 28 Mar 2024
Enter Symbol
or Name
USA
CA



Terra Energy Corp
Symbol TT
Shares Issued 106,663,422
Close 2015-03-31 C$ 0.085
Market Cap C$ 9,066,391
Recent Sedar Documents

Terra Energy loses $15.77-million in 2014

2015-04-01 06:10 ET - News Release

Mr. Bud Love reports

TERRA ENERGY RELEASES 2014 YEAR-END FINANCIAL RESULTS

Terra Energy Corp. has released its 2014 year-end financial results. Terra's 2014 audited financial statements and management's discussion and analysis may be obtained on SEDAR or the company's website.

The company's focus for 2014 was centred on the company's multiyear plan to pursue its objective of becoming a more balanced energy producer. Although the company made progress toward this objective during the year, all forward momentum was frustrated in the fourth quarter as result of the combination of weak oil and natural gas commodity prices. The company's approach in 2014 to limit capital spending to available cash flow resulted in the discontinuation of the capital expenditures program (involving oil development in Stoddard and Boudreau, British Columbia) in the fourth quarter of 2014.

                    2014 FINANCIAL AND OPERATING SUMMARY
             (in thousands of dollars, except per boe columns)

                                                 Year ended Dec. 31,
                                         2014      2013      2014      2013
                                                           ($/boe)   ($/boe)

Revenue before royalties             $ 47,125  $ 42,361   $ 35.90   $ 29.95
Royalties                              (8,846)   (7,251)    (6.74)    (5.13)
                                     --------- ---------  --------  --------
Revenue after royalties                38,279    35,110     29.16     24.82
Production expenses                   (22,819)  (21,238)   (17.39)   (15.01)
                                     --------- ---------  --------  --------
Operating netback                      15,459    13,872     11.77      9.81
General and administrative expenses    (5,804)   (7,503)    (4.42)    (5.30)
Financing costs                        (2,028)   (3,102)    (1.55)    (2.19)
Realized gain (loss) on derivatives      (405)     (455)    (0.31)    (0.32)
Unrealized gain (loss) on
derivatives                             4,225       759      3.22      0.54
Realized foreign exchange gain             (4)        3         -         -
Unrealized foreign exchange gain
(loss)                                      1        (3)        -         -
Other income -- flow-through shares        79         -      0.06         -
Non-cash expenses                     (27,762)  (13,982)   (21.15)    (9.88)
                                     --------- ---------  --------  --------
(Loss) before income taxes and other
income                                (16,239)  (10,411)   (12.38)    (7.36)
Gain on disposition of other assets       467    12,302      0.36      8.70
                                     --------- ---------  --------  --------
Net income (loss)                    $(15,772) $  1,891   $(12.02)  $  1.34
                                     ========= =========  ========  ========

General and administrative expense for the company was previously reduced from 2013 to 2014, year over year, by 22 per cent, and a further 10-per-cent reduction in G&A expense is targeted for 2015. To meet this objective, the company has frozen all employee salaries, suspended its annual bonus program for employees, eliminated all but essential new hires and has suspended its capital replacement program (for head office equipment). In addition, the company has eliminated virtually all contract positions from its head office and has reduced the number of full-time positions. Further, the directors of the company have implemented a voluntary reduction of directors' fees of approximately 20 per cent, and the president has agreed to a voluntary reduction of his salary of approximately 10 per cent.

In view of this prudent fiscal approach for 2015, management's focus will not be directed at growth opportunities, but at productivity improvements and gains in operational efficiencies, which will make the company that much stronger in the long term. These improvements and gains will continue to benefit the company when commodity prices eventually improve and when discretionary cash flow becomes more available.

Management's target for 2015 will be to offset production declines. The company will limit spending to those projects which involve operational efficiencies, cost reductions, productivity improvements or very short (six-month) payback periods. In the process the company will endeavour to reduce both operating costs and general and administrative expense on a per-barrel-of-oil-equivalent-unit-of-production basis.

The company does have several low-risk and low-cost projects for adding production during 2015, including the reduction of inlet suction pressures in several of its major gas fields. At the same time, the company has experienced curtailments of service in the first quarter of 2015 and interruptions in third party transportation/processing which continue to create near-term challenges.

Strategically, the company will continue to rely on commodity hedging in order to ensure that cash flows are sufficient to finance and execute on the company's overall plans. To that end, Terra has previously hedged approximately 8,000 gigajoules per day at an average price of $3.68 from Jan. 1 through Dec. 31, 2015, and 6,000 gigajoules per day from Jan. 1, 2016, to March 31, 2016, at an average price of $3.75.

We seek Safe Harbor.

© 2024 Canjex Publishing Ltd. All rights reserved.