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Canasia Energy Corp
Symbol CEC
Shares Issued 49,793,907
Close 2023-11-14 C$ 0.095
Market Cap C$ 4,730,421
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Canasia Energy loses $168,000 in Q3 2023

2023-11-16 11:27 ET - News Release

Mr. Jeff Chisholm reports

CANASIA ENERGY CORP. - 2023 THIRD QUARTER FINANCIAL & OPERATING RESULTS

Canasia Energy Corp. has released 2023 third quarter consolidated financial and operating results.

The company is today filing its unaudited consolidated financial statements as at and for the nine months ended Sept. 30, 2023, and related management's discussion and analysis with Canadian securities regulatory authorities. Copies of these documents may be obtained on-line on SEDAR+ or the company's website.

Commenting today on Canasia's 2023 third quarter results, president and chief executive officer Jeff Chisholm stated: "The company took steps in 2023 to increase the value of Andora's Sawn Lake SAGD [steam-assisted gravity drainage] demonstration project. Andora's minority shareholders were bought out for cash, resulting in 100-per-cent ownership of Andora by Canasia. Efforts were also made to deal with Andora's defaulting 25-per-cent partner in the Sawn Lake project. It is anticipated that Sawn Lake partner matters will be resolved by end of Q2 2024, allowing the company to move forward to maximize the value of its Sawn Lake interest. The company also fulfilled in 2023 various postclosing obligations to the purchaser under an August, 2022, transaction that resulted in the sale of Pan Orient Energy Corp. and transfer to the company of Pan Orient's non-Thailand business. Looking forward to 2024, the company is aware that the government of Thailand approved an onshore licensing round as indicated in the Royal Gazette. An announcement regarding the commencement of the licensing round is anticipated no later than Q1 2024. The company is currently negotiating a joint bid and study agreement with other parties. The company is confident that the necessary steps to create a stable growth platform, and maximize present and future shareholder value, will be in place in early to mid-2024."

Highlights:

  • Canasia had working capital totalling $2.1-million, no long-term debt and shareholders' equity of $1.4-million at Sept. 30, 2023.
  • Common shares outstanding were 49.8 million at Nov. 14, 2023, and Sept. 30, 2023.
  • Net loss attributable to common shareholders for the third quarter of 2023 was $200,000 (nil per share) compared with $700,000 (one cent per share) in the second quarter. Cash flow used in operations for the third quarter of 2023 was $500,000 (one cent per share) compared with $1.1-million (two cents per share) in the second quarter.
  • General and administrative expense in the third quarter of 2023 was $551,000 compared with $480,000 in the second quarter, primarily comprising expenses related to personnel and premises, external services, and public company costs.
    • Personnel and premises costs in the third quarter of 2023 were $180,000 compared with $171,000 in the second quarter. These costs include salaries and benefits for employees, and fees incurred for consultants and contractors. They also include rent and other office costs related to the company's Calgary office.
    • External services costs in the third quarter of 2023 were $225,000 compared with $177,000 in the second quarter, mainly related to professional fees for legal, audit and tax services. The increase is mainly due to legal fees incurred for the enforcement actions against Andora Energy Corp.'s 25-per-cent working interest Sawn Lake partners and winding up costs of these subsidiaries of Pan Orient Energy Holdings Ltd. (POEH).
    • Public company costs of $88,000 in the third quarter of 2023 compared with $75,000 in the second quarter were incurred for maintaining the company's status as a public company.
  • Operating expenses in the third quarter of 2023 were $110,000 compared with $145,000 in the second quarter. These were incurred to safeguard and maintain the assets of Andora's suspended steam-assisted gravity drainage project facility and wellpair at Sawn Lake Central.
  • The natural gas pipeline tariff agreement which was entered into between Andora and a third party in 2018 with a commencement date of June 1, 2023, is considered an onerous contract as of March 31, 2023, under IAS 37 since the operation at Sawn Lake is shut in. The company has recognized a provision of $1-million representing the net cost of fulfilling the contract.
  • The current portion of the decommissioning provision of $700,000 as at Sept. 30, 2023, relates to the legacy subsidiaries of POEH which had held interests in the East Jabung production sharing contract (PSC) in Indonesia and a well pertaining to Andora's interests in Sawn Lake, Alberta. Canasia is withdrawing from activities in Indonesia and decommissioning related costs are expensed when incurred. During the third quarter of 2023, the company revised its estimate of the decommissioning provision at the Jambi PSC resulting in a $300,000 reduction to the current decommissioning provision during the quarter. The non-current portion of the decommissioning provision of $1.3-million as at Sept. 30, 2023, pertained to Andora's interests in Sawn Lake, Alberta.

Outlook

The company took steps in 2023 to increase the value of Andora's Sawn Lake SAGD demonstration project. Andora's minority shareholders were bought out for cash, resulting in 100-per-cent ownership of Andora by Canasia. Efforts were also made to deal with Andora's defaulting 25-per-cent partner in the Sawn Lake project. It is anticipated that Sawn Lake partner matters will be resolved by end of Q2 2024, allowing the company to move forward to maximize the value of its Sawn Lake interest. The company also fulfilled in 2023 various postclosing obligations to the purchaser under an August, 2022, transaction that resulted in the sale of Pan Orient Energy and transfer to the company of Pan Orient's non-Thai business. Looking forward to 2024, the company is aware that the government of Thailand approved an onshore licensing round as indicated in the Royal Gazette. An announcement regarding the commencement of the licensing round is anticipated no later than Q1 2024. The company is currently negotiating a joint bid and study agreement with other parties. The company is confident that the necessary steps to create a stable growth platform, and maximize present and future shareholder value, will be in place in early to mid-2024.

We seek Safe Harbor.

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