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TransAtlantic Petroleum Ltd (2)
Symbol TNP
Shares Issued 52,496,666
Close 2019-08-07 C$ 0.93
Recent Sedar Documents

TransAtlantic Petroleum loses $9,000 (U.S.) in Q2

2019-08-07 17:57 ET - News Release

Ms. Tabitha Bailey reports

TRANSATLANTIC PETROLEUM ANNOUNCES SECOND QUARTER 2019 FINANCIAL RESULTS AND PROVIDES AN OPERATIONS UPDATE

TransAtlantic Petroleum Ltd. has released its financial results for the quarter ended June 30, 2019, and has provided an operations update. Additional information can be found on the company's website.

Summary:

  • Average daily net sales volumes were 2,873 barrels of oil equivalent per day in the second quarter of 2019, as compared with 3,082 boe per day in the first quarter of 2019 and 2,746 boe per day in the second quarter of 2018.
  • Revenues were $17.2-million for the second quarter of 2019, as compared with $19.0-million for the first quarter of 2019 and $18.2-million for the second quarter of 2018.
  • Operating income was $6.3-million for the second quarter of 2019, as compared with $3.2-million for the first quarter of 2019 and $6.9-million for the second quarter of 2018.
  • Net loss was $10,000 for the second quarter of 2019, as compared with $3.9-million for the first quarter of 2019 and $1.0-million for the second quarter of 2018.
  • Adjusted EBITDAX (net loss plus interest and other income, net, income tax expense, exploration, abandonment, and impairment, seismic and other exploration expense, foreign exchange loss, share-based compensation expense, loss on commodity derivative contracts, cash settlements on commodity derivative contracts, accretion of asset retirement obligation, and depreciation, depletion and amortization) was $10.7-million for the second quarter of 2019, as compared with $12.3-million for the first quarter of 2019 and $8.7-million for the second quarter of 2018 (1).
  • Net debt was $17.5-million as of June 30, 2019, as compared with $17.2-million as of March 31, 2019 (2). Bank debt was reduced by $5.7-million in the second quarter of 2019, and capital expenditures were $6.2-million for the second quarter of 2019.

(1) Adjusted EBITDAX is a non-generally accepted accounting principle financial measure.

(2) Net debt is a non-GAAP financial measure consisting of total debt as reflected on the company's balance sheet minus cash and cash equivalents as reflected on the company's balance sheet. For June 30, 2019, total debt was $31.2-million, and cash and cash equivalents were $13.7-million. For March 31, 2019, total debt was $36.9-million, and cash and cash equivalents were $19.7-million.

                       RESULTS OF OPERATIONS
 
                                  For the three months ended          
                          June 30, 2019   March 31, 2019   June 30, 2018 
Net sales                                                             
Oil (Mbbl)                          253              269             241 
Natural gas (MMcf)                   48               50              56 
Total net sales (Mboe)              261              277             250 
Average net sales (boe/d)         2,873            3,082           2,746 
Realized commodity prices                                             
Oil ($/bbl unhedged)             $66.57           $69.00          $74.10 
Oil ($/bbl hedged)                66.57            69.00           66.37 
Natural gas ($/Mcf)                5.41             5.94            4.84 

Total revenues were $17.2-million for the three months ended June 30, 2019, as compared with $19.0-million for the three months ended March 31, 2019, and $18.2-million for the three months ended June 30, 2018. The company had a net loss of $10,000, or nil per share (basic and diluted), for the three months ended June 30, 2019, as compared with $3.9-million, or seven cents per share (basic and diluted), for the three months ended March 31, 2019, and $1.0-million, or two cents per share (basic and diluted), for the three months ended June 30, 2018. Capital expenditures and seismic and corporate expenditures totalled $6.2-million for the three months ended June 30, 2019, as compared with $9.2-million for the three months ended March 31, 2019, and $5.6-million for the three months ended June 30, 2018.

Adjusted EBITDAX was $10.7-million for the three months ended June 30, 2019, as compared with $12.3-million for the three months ended March 31, 2019, and $8.7-million for the three months ended June 30, 2018.

Operational update

Southeastern Turkey

Molla

Yeniev field

Both the Yeniev-1 and West Yeniev-1 wells continue flowing naturally from the Bedinan formation with little water.

The East Yeniev-1 well was put on production in the first quarter of 2019 and completed in the Mardin formation.

In the second quarter of 2019, the company drilled the Yeniev-4 well to a total measured depth of 9,520 feet, targeting the Bedinan, Hazro and Mardin formations. The company recovered approximately 120 feet of core from the Bedinan sandstone, which is currently undergoing analysis to assist in infill development planning and secondary recovery evaluation. The company plans to commence completion operations in the third quarter of 2019.

The company plans to spud the Yeniev-5 and Yeniev-6 wells in the third and fourth quarter of 2019, respectively, to test the Mardin, Hazro and Bedinan formations. The company expects to core approximately 150 feet of the Mardin formation in the Yeniev-5 well to assist in infill development planning and secondary recovery evaluation.

Bahar field

The southeast Bahar-1 well was drilled to a total measured depth of 11,000 feet in the second quarter of 2019. Oil shows were observed in the Bedinan and Mardin formations, and oil was swab tested from the Bedinan formation. Completion operations are currently continuing.

The company commenced drilling the Bahar-12 well in July, 2019, targeting the Bedinan and Hazro formations. The company recovered approximately 150 feet of core from the Hazro formation and expects to core the well in the Bedinan formation to further assist in infill development planning and secondary recovery evaluation for the Bahar field.

Blackeye field

The Blackeye-1 well continues to produce at a stable rate with low water cut from the Hazro F4 formation. The company is evaluating testing additional formations within the well and drilling additional appraisal wells to develop the field.

During the second quarter of 2019, the company's application for conversion of the New Molla exploration licence into a production lease was approved.

Pinar field

The company plans to stimulate the Pinar-1 sidetrack well in the third quarter of 2019. The well is currently producing commercial oil with low productivity from the Bedinan formation.

Bati-Yasince field

In the third quarter of 2019, the company plans to re-enter the Bati-Yasince-1 well and deepen the well to the Hazro formation.

Arpatepe field

In the third quarter of 2019, the company plans to recomplete the Arpatepe-2 well as a water injection well and execute the first phase of a water flood of the Arpatepe field. Subject to the results of the initial phase, the company intends to expand to full field flooding in the future.

Selmo

During the second quarter of 2019, the company has continued a recompletion, workover and production optimization campaign in the Selmo field.

Northwestern Turkey

Thrace basin BCGA

The company continues to evaluate its prospects in the Thrace basin's basin centre gas accumulation (Thrace basin BCGA) in light of the recent exploration activity by Valeura Energy Inc. with its partner Equinor ASA (formerly Statoil ASA) on a licence directly adjacent to the company's 120,000 net acres in the Thrace basin, of which the company believes approximately 50,000 net acres (100-per-cent working interest and 87.5-per-cent net revenue interest) are in the Thrace basin BCGA.

In the second quarter of 2019, the company drilled the Karli-1 well to a total measured depth of 1,289 feet and encountered several shallow gas sand intervals. The company is currently evaluating completion options.

Valeura and Equinor

According to Valeura and Equinor, in the third quarter of 2018, the Yamalik-1 well was recompleted and was flowing gas, condensate and water. In the second quarter of 2019, Valeura and Equinor announced that they are developing a plan to re-enter the well to isolate a portion of the column to conduct further selective zonal flow testing.

In the first quarter of 2019, Valeura and Equinor announced that the Inanli-1 well was drilled to a total depth of 4,885 metres and encountered 1,615 metres of high net-to-gross sandstone, which they interpreted to contain overpressured gas. According to Valeura and Equinor, completion operations are continuing.

In the second quarter of 2019, Valeura and Equinor announced that they drilled the Devepinar-1 appraisal well to a total depth of 4,796 metres after drilling a 1,066-metre gross column of indicated overpressured gas. According to Valeura and Equinor, the Devepinar-1 appraisal well is designed as a 20-kilometre stepout well to test the lateral extent of the Thrace basin BCGA.

Bulgaria

The company is currently evaluating future activity in Bulgaria.

Conference call

The company will host a live webcast and conference call on Aug. 8, 2019, at 7:30 a.m. Central Time (8:30 a.m. Eastern Time) to discuss second quarter 2019 financial results and provide an operations update. Investors who would like to participate in the conference call should call 877-878-2762 or 678-809-1005 approximately 10 minutes prior to the scheduled start time and ask for the TransAtlantic conference call. The conference ID is 1037989.

A live webcast of the conference call and replay will be available through the company's website. To access the webcast and replay, click on investors, select events and presentations, and click on listen to webcast under the event list. The webcast requires iOS, Microsoft Windows media player or RealOne player.

A telephonic replay of the call will be available through Aug. 10, 2019, and may be accessed by dialling 855-859-2056 or 404-537-3406. The conference ID is 1037989.

                            CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                            (U.S. dollars in thousands, except per-share amounts)

                                                 For the three months ended        For the six months ended
                                              June 30, 2019   June 30, 2018   June 30, 2019   June 30, 2018
Revenues
Total revenues                                      $17,215         $18,198         $36,256         $35,124
Costs and expenses
Production                                            2,712           2,804           5,214           5,673
Transportation and processing                         1,221           1,138           2,540           2,331
Exploration, abandonment and impairment                 666             191           5,779             231
Seismic and other exploration                           108              59             185             218
General and administrative                            2,690           3,786           5,744           7,123
Depreciation, depletion and amortization              3,442           3,276           7,158           7,735
Accretion of asset retirement obligations                49              43             101              89
                                                   --------        --------        --------        --------
Total costs and expenses                             10,888          11,297          26,721          23,400
                                                   --------        --------        --------        --------
Operating income                                      6,327           6,901           9,535          11,724
                                                   --------        --------        --------        --------
Other (expense) income
Interest and other expense                           (2,753)         (2,091)         (5,231)         (4,873)
Interest and other income                               221             377             395             631
(Loss) on commodity derivative contracts               (323)         (3,141)           (433)         (3,866)
Foreign exchange (loss)                                (115)         (1,938)         (1,388)         (3,996)
                                                   --------        --------        --------        --------
Total other expense                                  (2,970)         (6,793)         (6,657)        (12,104)
                                                   --------        --------        --------        --------
Income (loss) before income taxes                     3,357             108           2,878            (380)
Income tax expense                                   (3,366)         (1,114)         (6,789)         (2,401)
                                                   --------        --------        --------        --------
Net (loss)                                               (9)         (1,006)         (3,911)         (2,781)
Other comprehensive (loss)
Foreign currency translation adjustment                (416)         (9,109)         (4,642)        (11,452)
                                                   --------        --------        --------        --------
Comprehensive (loss)                                   (425)        (10,115)         (8,553)        (14,233)
Net (loss) per common share
Basic net (loss) per common share                     (0.00)          (0.02)          (0.07)          (0.06)
Diluted net (loss) per common share                   (0.00)          (0.02)          (0.07)          (0.06)

About TransAtlantic Petroleum Ltd.

The company is an international oil and natural gas company engaged in the acquisition, exploration, development and production of oil and natural gas. The company holds interests in developed and undeveloped properties in Turkey and Bulgaria.

We seek Safe Harbor.

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