Business
Hemisphere Energy Provides Operations Update and Outlines Plans for 2020
Vancouver, British Columbia--(Newsfile Corp. - February 5, 2020) - Hemisphere Energy Corporati...
About this update from Hemisphere Energy Corp
[{"type":"text","content":"Hemisphere Energy Provides Operations Update and Outlines Plans for 2020Vancouver, British Columbia--(Newsfile Corp. - February 5, 2020) - Hemisphere Energy Corporation (TSXV: HME) (\"Hemisphere\" or the \"Company\") is pleased to provide an update on its Southern Alberta oil assets following a successful 2019. Through 2019, Hemisphere drilled 11 horizontal oil wells in its Upper Mannville G pool, which greatly expanded development in the Company's most prolific oil pool. The summer drilling program was completed on budget and on time with all wells being brought on production by the fourth quarter. Based on field estimates, corporate production during the fourth quarter of 2019 averaged approximately 2,160 boe/d (98% heavy crude oil and 2% conventional natural gas), which represents significant growth of more than 55% over the fourth quarter of 2018. Current production, based on field estimates for January 2020, is approximately 1,990 boe/d (98% heavy crude oil and 2% conventional natural gas) despite severe winter weather and two wells waiting on workovers during the month.Hemisphere attained this growth while keeping capital outlay within its 2019 annual funds flow from operations. Capital expenditures for 2019 were approximately $11 million, which contributed to production growth of approximately 50% year over year. In addition, Hemisphere was able to purchase over 1.2 million shares under the Company's Normal Course Issuer Bid (NCIB) program, while still lowering its year-end net debt to approximately $32 million. With record production levels and Western Canada Select (WCS) oil price averaging approximately $54.30 per barrel in the fourth quarter, Hemisphere achieved an estimated operating field netback of $31.36 per boe. Fourth quarter revenue was approximately $9.5 million which resulted in estimated funds flow from operations of $4.6 million. Total annual estimated funds flow from operations for the year ending December 31, 2019 was approximately $13.3 million. Looking ahead to the rest of 2020, Hemisphere plans to continue its strategy of growing within funds flow from operations, with a strong focus on debt and related interest cost reduction. As in previous years, the Company intends to execute the majority of its capital program in the third quarter to take advantage of construction, drilling, completion, and tie-in...