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Hemisphere Energy Announces Financial and Operating Results for Q2 2020
Vancouver, British Columbia--(Newsfile Corp. - August 27, 2020) - Hemisphere Energy Corporatio...
About this update from Hemisphere Energy Corp
[{"type":"text","content":"Hemisphere Energy Announces Financial and Operating Results for Q2 2020Vancouver, British Columbia--(Newsfile Corp. - August 27, 2020) - Hemisphere Energy Corporation (TSXV: HME) (\"Hemisphere\" or the \"Company\") announces its financial and operating results for the three and six months ended June 30, 2020. Q2 2020 HighlightsAchieved revenue of $2.5 million.Realized an operating netback of $2.7 million, including hedging gains of $1.4 million.Attained quarterly adjusted funds flow from operations of $1.4 million or $0.02 per share (basic).Increased quarterly production by 20% to 1,645 boe/d (100% heavy crude oil), over the second quarter of 2019.Reduced operating and transportation expenses to $7.64/boe, a 50% decrease from the second quarter of 2019.Achieved an operating netback of $17.74/boe, including a $9.33/boe hedging gain.Lowered net debt to $30.9 million, a $2.3 million decrease from the end of the first quarter 2020.Increased corporate Liability Management Ratio (LMR) with the Alberta Energy Regulator to 12.19 as of the end of the second quarter of 2020.Corporate UpdateDuring the second quarter of 2020, Hemisphere was impacted by the significant drop in oil prices due to the demand reduction caused by the COVID-19 pandemic. Despite these challenges, Hemisphere managed to achieve positive operating netback of $17.74/boe and funds flow from operations of $1.4 million by adapting quickly to the changing market conditions. The Company shut-in its highest operating cost wells, deferred all but essential capital spending, and took on additional oil hedges to keep the majority of its operations running while protecting against the risk of negative oil prices.Hemisphere's production averaged 1,645 boe/d (100% heavy crude oil) through the second quarter, after shutting in some of its higher cost wells. With a sharp focus on maximizing netbacks, Hemisphere was able to lower its operating and transportation costs for the second quarter to $7.64/boe. This reduction is a result of diligent work by the operations team and proactive rate reductions from our core vendors and service providers. Since bringing most of its wells back on, Hemisphere's corporate production to date in August is currently averaging approximately 1,725 boe/d (field estimate for Aug 1-24, 99% heavy crude oil and 1% conventional natural gas). Fuel gas issues i...