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2016-05-20

SHAMARAN Q1 2016 FINANCIAL AND OPERATING RESULTS

N Q1 2016 FINANCIAL AND OPERATING RESULTS

May 19, 2016 - ShaMaran Petroleum Corp. ("ShaMaran" or the "Company") (TSX
VENTURE: SNM) (NASDAQ OMX: SNM) is pleased to announce its financial and
operating results for the three months ended March 31, 2016. Unless otherwise
stated all currency amounts indicated as “$” in this news release are expressed
in thousands of United States dollars.

Construction of the 30,000 bopd Atrush Phase 1 Production Facility (“Production
Facility”) is nearing mechanical completion. Commissioning is scheduled to
begin in May of 2016. Completion of the production facilities is targeted for
mid 2016.

Work on the dedicated feeder pipeline to be constructed between the Production
Facility and the tie-in point on the main export pipeline has started. The
Atrush partnership is responsible for construction of the pipeline to the block
boundary, which is progressing according to plan. The KRG is responsible for
the construction of the section of the pipeline from the block boundary to the
tie-in point on the main export pipeline. Originally it was planned to
construct a 31 kilometre 12 inch pipeline from the block boundary to KCP2. It
is now planned to construct a 12 inch pipeline to the location of a future
blending station followed by a 36 inch pipeline. Delays in the commencement of
this pipeline project have resulted in first oil being deferred until the
fourth quarter of 2016.

The Operator plans to complete the Atrush-2 and Atrush-4 wells in June and July
2016. Four producing wells, all equipped with ESPs, will be available for
production at start up.

Chris Bruijnzeels, President and CEO of ShaMaran, commented “Progress of the
facilities construction is according to plan. Unfortunately, changes in the
feeder pipeline scope outside the block boundary will result in a delay to
first oil. However, the changed scope should result in increased flexibility of
the KRG export pipeline system.”

FINANCIAL AND OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2016

During the reporting period the Company continued its appraisal and development
campaign in respect of the Atrush petroleum property located in the Kurdistan
Region of Iraq which constitutes the continuing operations of the Company.
Atrush currently generates no revenues.

Financial Results

The Company reports a net loss of $2.8 million in the first quarter of 2016
which was primarily driven by routine general and administrative expenses and
expensed borrowing costs on the Company’s senior secured bonds.

Condensed Interim Statement of Comprehensive Income

(Unaudited, expressed in thousands of United States Dollars)

For the three months ended
March 31,
2016 2015
--------------------------------------------------------------------------------
Expenses from continuing operations
Depreciation and amortisation expense (11) (16)
Share based payments expense (76) (676)
General and administrative expense (1,302) (963)
Loss before finance items and income tax expense (1,389) (1,655)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Finance income 21 542
Finance cost (1,402) (1,346)
--------------------------------------------------------------------------------
Net finance cost (1,381) (804)
--------------------------------------------------------------------------------
-----------
Loss before income tax expense (2,770) (2,459)
Income tax expense (26) (27)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Loss from continuing operations (2,796) (2,486)
Discontinued operations
Net loss from discontinued operations - (10)
Loss for the period (2,796) (2,496)
--------------------------------------------------------------------------------

Other comprehensive income
Items that may be reclassified to profit or loss: 32 11
Currency translation differences
--------------------------------------------------------------------------------
Total other comprehensive income 32 11
--------------------------------------------------------------------------------

Total comprehensive loss for the period (2,764) (2,485)
--------------------------------------------------------------------------------

Condensed Interim Consolidated Balance Sheet

(Unaudited, expressed in thousands of United States Dollars)

At March 31, 2016 At December 31, 2015
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Assets
Non-current assets
Property, plant and equipment 188,823 177,044
Intangible assets 89,477 88,645
278,300 265,689
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Current assets
Cash and cash equivalents, unrestricted 18,411 30,409
Cash and cash equivalents, restricted 5,825 1,512
Other current assets 222 200
24,458 32,121
--------------------------------------------------------------------------------
Total assets 302,758 297,810
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Liabilities and equity
Current liabilities
Accounts payable and accrued expenses 11,956 9,560
Accrued interest expense on bonds 6,612 2,252
Current tax liabilities 16 31
18,584 11,843
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Non-current liabilities
Borrowings 148,416 148,263
Provisions 8,822 8,080
--------------------------------------------------------------------------------
157,238 156,343
--------------------------------------------------------------------------------
Total liabilities 175,822 168,186
--------------------------------------------------------------------------------
Equity
Share capital 593,179 593,179
Share based payments reserve 6,311 6,235
Cumulative translation adjustment (51) (83)
Accumulated deficit (472,503) (469,707)
--------------------------------------------------------------------------------
Total equity 126,936 129,624
--------------------------------------------------------------------------------
Total liabilities and equity 302,758 297,810
--------------------------------------------------------------------------------

Total assets increased during the first quarter of 2016 by $4.9 million which
corresponds to an increase in liabilities by $7.6 million mainly due to an
increase in accounts payable, accrued expenses and accrued interest and a
decrease in equity by $2.7 million principally due to the net loss recorded in
the period.

Property, plant & equipment assets increased by $11.8 million during the first
three months of 2016 was due to $9.0 million of Atrush development costs
incurred during the period and capitalised borrowing costs of $2.8 million.
The increase in intangible assets by $0.8 million during the first quarter is
due to $0.4 million of Atrush exploration costs incurred in the period and
capitalised borrowing costs of $0.4 million.

Condensed Interim Consolidated Cash Flow Statement

(Unaudited, expressed in thousands of United States Dollars)

For the three months
ended March 31,
2016 2015
--------------------------------------------------------------------------------
Operating activities
Net loss from continuing operations (2,796) (2,486)
Adjustments for:
Interest expense ...

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