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ROK Resources Inc. Announces Completion of $47.25 Million of Non-Core Asset Dispositions & Provides Update on 2023 Guidance
NOT FOR DISTRIBUTION TO THE U.S. NEWSWIRE OR FOR DISSEMINATION IN THE UNITED STATES REGINA, S...
About this update from Rok Resources, Inc. Class B
[{"type":"text","content":"ROK Resources Inc. Announces Completion of $47.25 Million of Non-Core Asset Dispositions & Provides Update on 2023 GuidanceNOT FOR DISTRIBUTION TO THE U.S. NEWSWIRE OR FOR DISSEMINATION IN THE UNITED STATESREGINA, SK / ACCESSWIRE / April 3, 2023 / ROK Resources Inc. (TSXV:ROK)(TSXV:ROK.WT) (the \"Company\" or \"ROK\") has completed its previously announced dispositions of certain non-core assets (the \"Assets\") for total combined proceeds of approximately $47.25 million, before normal closing adjustments (the \"Transactions\"). The Assets are comprised of ROK's non-operated interest in the Weyburn Unit and two smaller non-core assets located in Saskatchewan.The Transactions are consistent with ROK's strategic plan, focusing on debt reduction and high-grading of the Company's asset portfolio and drilling inventory. The Company's outstanding senior term debt will be reduced by 85% from proceeds of the Transactions, resulting in cumulative interest savings of approximately $5.8 million that would have been otherwise paid over the remaining term of the senior term debt.Notably, since the FCL acquisition in March 2022, the Company has disposed of approximately $74 million in non-core assets representing ~31% of production and ~127% of the purchase price, after closing adjustments.2023 GuidanceCurrent corporate production is approximately 3,750 boepd (65% Liquids), net of the above-noted disposition.In the second half of 2023, ROK intends to focus on increasing shareholder value through; (i) the optimization and integration of asset acquisitions, (ii) debt reduction, and (iii) executing a drilling and recompletion program. For H2 2023E, the Company expects to average 4,120 boepd, generating $19 million in cash flow from operating activities1. For Q4 2023E, the Company estimates exit production of 4,500 boepd, generating a total of $38.9 million in annualized cash flow from operating activities1, and $5.9 million in annualized free cash flow.The Company's senior term debt is expected to be paid off entirely by mid-2023. Net debt at December 31, 2023 is expected to be $7.5 million, implying a net debt to cash flow from operating activities ratio of 0.2.In support of the 2023 drilling program, the Company currently has hedged an average of 1,766 bbls/d of corporate production for the remainder of 2023 at an average price of approximatel...