Highlights
- The Company is awaiting final approval from the Government of
Kazakhstan for its 95% working interest in a lithium brine mining license inKazakhstan . Procurement and contracting of long-lead equipment for 2023 drilling activities continues. - Natural gas production in Turkiye increased 3% in the first quarter of 2023 to 18,536 Mcf or an average of 206 Mcf/d from 18,003 Mcf or an average of 200 Mcf/d for the first quarter of 2022.
- The Company continues to actively pursue an agreement to operate multiple mid-sized existing natural gas fields in
Uzbekistan . - In
Kazakhstan , activities are ongoing to secure a long-term LNG feed gas supply contract.
Lithium License Acquisition
The Company is awaiting final approval from the Government of
The Lithium License provides subsurface exploration rights for solid minerals until
During 2023, the Company plans to drill and test up to two wells to confirm the lateral extension and lithium concentrations in the tested and untested intervals, well deliverability rates, conduct preliminary engineering for the production facilities, and prepare a National Instrument 43-101 compliant mineral resources or mineral reserves report. Procurement and contracting of long-lead equipment for these drilling activities is underway.
The Company intends to produce the lithium by utilizing closed-looped Direct Lithium Extraction (“DLE”) technologies. With the lithium already in brine solution and applying existing DLE production technologies, the Company expects to have a much smaller environmental footprint than existing lithium production operations. Furthermore, the Company is evaluating the construction of a solar power generation project to support the long-term expansion of the project to achieve net-zero emissions. Also, given that the Company’s Lithium License is not associated with legacy oil wells, a less complex and capital intensive DLE technology is envisioned for separation of lithium from the brine.
Turkiye Operations
Gas production for the first quarter of 2023 increased 3% to 18,536 Mcf or an average of 206 Mcf/d from 18,003 Mcf or an average of 200 Mcf/d for the first quarter of 2022.
Posted Turkish gas prices for the first quarter of 2023 averaged
The Company is seeking a partner to fund development plans at the Yakamoz field, which is located 2 km north of the existing
General elections are scheduled to take place in Turkiye on
Uzbekistan Production Contract and LNG Strategy
The Company continues to actively pursue an agreement to operate multiple mid-sized existing natural gas fields in
In addition, the Company has presented a proposal to the Government of
LNG Initiatives in
The Company continues to mature opportunities to implement proven North American modular LNG technologies and processes in
Front-end engineering for a 125,000 gallons per day modular LNG facility has been completed. Design on a scaled down trailer-mounted version is also underway to utilize feed gas supplied from stranded gas assets that aren’t commercially viable due to pipeline infrastructure costs or from the associated gas from producing crude oil fields. The potential to profitably generate LNG at feed gas site locations is one of the many advantages that the Company’s LNG approach provides.
RESULTS OF OPERATIONS
Production
For the three months ended | 2023 | 2022 | Change | Change % | |
Natural gas (Mcf) | 18,536 | 18,003 | 533 | 3 | % |
Natural gas (Mcf per day) | 206 | 200 | 6 | 3 | % |
Natural gas production increased 3% to 18,536 Mcf or an average of 206 Mcf per day for the three months ended
Operating netback
For the three months ended
Operating netback 1 | 2023 | 2022 | |||||||
Gas | Condensate | Total2 | Gas and Total2 | ||||||
(000's) | |||||||||
Sales | 396 | 15 | 411 | 260 | |||||
Royalties | (57 | ) | (2 | ) | (59 | ) | (34 | ) | |
Production costs | (228 | ) | (10 | ) | (238 | ) | (151 | ) | |
Transportation and selling | (7 | ) | (3 | ) | (10 | ) | (26 | ) | |
Operating netback 1 | 104 | - | 104 | 49 | |||||
(Mcf) | (bbl) | (Mcf) | |||||||
Sales volume | 15,556 | 118 | 16,335 | ||||||
($ per unit) | ($/Mcf) | ($/bbl) | ($/Mcf) | ||||||
Sales | 25.46 | 126.95 | 15.92 | ||||||
Royalties | (3.66 | ) | (16.93 | ) | (2.08 | ) | |||
Production costs | (14.66 | ) | (84.63 | ) | (9.24 | ) | |||
Transportation and selling | (0.45 | ) | (25.39 | ) | (1.59 | ) | |||
Operating netback 1 | 6.69 | - | 3.01 |
1 Operating netback is a non-GAAP measure and is a term with no standardized meaning as prescribed by GAAP and may not be comparable with similar measures presented by other issuers. See “Non-GAAP Financial Measures” in this news release. The calculation of operating netback is aligned with the definition found in the Canadian Oil and Gas Evaluation Handbook.
2 Per unit measures are not presented for Total amounts and analysis is considered more meaningful presented separately for natural gas and condensate.
The operating netback on natural gas sales increased to
NON-GAAP FINANCIAL MEASURES
The Company refers to “operating netback” in this news release, a term with no standardized meaning as prescribed by GAAP and which may not be comparable with similar measures presented by other issuers. This additional information should not be considered in isolation or as a substitute for measures prepared in accordance with GAAP. Operating netback is calculated as sales less royalties, production costs and transportation and selling on a dollar basis and divided by the sales volume for the period on a per Mcf basis for natural gas and on a per barrel basis for condensate. The reconciliation of this non-GAAP measure is presented in the “Operating netback” section of this news release. This non-GAAP measure is commonly used in the oil and gas industry to assist in measuring operating performance against prior periods on a comparable basis and has been presented to provide an additional measure to analyze the Company’s sales on a per unit basis and the Company’s ability to generate funds.
FORWARD-LOOKING STATEMENTS
Certain statements in this news release constitute forward-looking statements under applicable securities legislation. Such statements are generally identifiable by the terminology used, such as “anticipate”, “intend”, “expect”, “plan”, “estimate”, “budget”, “schedule”, “may”, “will”, “could”, “would”, “continue”, “pursue”, “prepare”, “envision”, “project”, “potential” or other similar wording. Forward-looking information in this news release includes, but is not limited to, information concerning: the timing and ability to execute the Company’s growth and sustainability strategies; the timing and ability to obtain the approvals required from the Government of
This news release also includes forward-looking information regarding health risk management including, but not limited to: travel restrictions including shelter in place orders, curfews and lockdowns which may impact the timing and ability of Company personnel, suppliers and contractors to travel internationally, travel domestically and to access or deliver services, goods and equipment to the fields of operation; the risk of shutting in or reducing production due to travel restrictions, Government orders, crew illness, and the availability of goods, works and essential services for the fields of operations; decreases in the demand for oil and gas; decreases in natural gas, condensate and crude oil prices; potential for gas pipeline or sales market interruptions; the risk of changes to foreign currency controls, availability of foreign currencies, availability of hard currency, and currency controls or banking restrictions which restrict or prevent the repatriation of funds from or to foreign jurisdiction in which the Company operates; the timing and ability to execute a production contract with the Government of
By its very nature, such forward-looking information requires Condor to make assumptions that may not materialize or that may not be accurate. Forward-looking information is subject to known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such information. Such risks and uncertainties include, but are not limited to: regulatory changes; the timing of regulatory approvals; the risk that actual minimum work programs will exceed the initially estimated amounts; the results of exploration and development drilling and related activities; factors affecting the Lithium License Seller’s ability to transfer the title of the Lithium License to Condor; prior lithium testing results may not be indicative of future testing results or actual results; imprecision of reserves estimates and ultimate recovery of reserves; the effectiveness of lithium mining and production methods including DLE technology; historical production and testing rates may not be indicative of future production rates, capabilities or ultimate recovery; the historical composition and quality of oil and gas may not be indicative of future composition and quality; general economic, market and business conditions; industry capacity; uncertainty related to marketing and transportation; competitive action by other companies; fluctuations in oil and natural gas prices; the effects of weather and climate conditions; fluctuation in interest rates and foreign currency exchange rates; the ability of suppliers to meet commitments; actions by governmental authorities, including increases in taxes; decisions or approvals of administrative tribunals and the possibility that government policies or laws may change or government approvals may be delayed or withheld; changes in environmental and other regulations; risks associated with oil and gas operations, both domestic and international; international political events; and other factors, many of which are beyond the control of Condor. Capital expenditures may be affected by cost pressures associated with new capital projects, including labour and material supply, project management, drilling rig rates and availability, and seismic costs.
These risk factors are discussed in greater detail in filings made by Condor with Canadian securities regulatory authorities including the Company’s Annual Information Form, which may be accessed through the SEDAR website (www.sedar.com).
Readers are cautioned that the foregoing list of important factors affecting forward-looking information is not exhaustive. The forward-looking information contained in this news release are made as of the date of this news release and, except as required by applicable law, Condor does not undertake any obligation to update publicly or to revise any of the included forward-looking information, whether as a result of new information, future events or otherwise. The forward-looking information contained in this news release is expressly qualified by this cautionary statement.
ABBREVIATIONS
The following is a summary of abbreviations used in this news release:
M | Thousands | |
MM | Millions | |
Mcf | Thousands of standard cubic feet | |
Mcf/d | Thousands of standard cubic feet per day | |
bbl | Barrels | |
CAD | Canadian dollars | |
KZT | ||
TRL | Turkish lira | |
USD | ||
Q | Quarter | |
LNG | Liquefied natural gas | |
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Source:
2023 GlobeNewswire, Inc., source