Second Quarter FY2018 Report
Substantial increase in Quarter-on-Quarter production -more than doubled
- Company sets new quarterly production record of ~673,100 BOE.
- Quarter-on-Quarter increase in production largely driven by completion of AnethOil Field acquisition.
- Corresponding Period over FY 2017 productiongrowth driven by both Aneth Oil Field and MaddenGas Field acquisitions.
- Quarterly production only reflects 2 full months ofAneth production from 1 November 2017 Anethpurchase effective date.
- Oil now makes up over 50% of Company's totalproduction (53%).
Substantial increase in sales revenue for the Quarter -up nearly 5-fold
- Revenue increase driven by increased production volume from completion of Aneth Oil Field acquisition.
- Revenue increase only reflects 2 full months of Aneth production from 1 November 2017 Aneth purchase effective date.
- Revenue increase also driven by exposure to higher BOE value Aneth oil production versus Madden gas production -average realised price of production more than doubled
- Revenue increase also reflects substantial increase in realized price for sulfurproduction from Lost Cabin Gas Plant -up ~50%
- Revenues also reflect resumption of CO2sales from Lost Cabin Gas Plant to Denbury Resources
Completed significant preferred equity and senior debt financings to fund Aneth acquisition
Aneth Oil Field & CO2 Project acquisition
- Company completed Aneth Oil Field & CO2 Project on 6 November 2017 for an initial acquisition consideration of USD 160 million.
- Acquisition funded through combination of issuance of common equity, preferred equity and senior term loan debt.
Share placement to institutional investors
- On 27 October 2017, shareholders approved the placement of ~248 million shares at A$0.062 per share to sophisticated institutional investors.
Preferred equity placement completed
- On 6 November 2017, the Company completed a USD 65 million placement of unlisted preferred equity by Elk Petroleum, Inc. to US and international institutional investors.
Senior debt financing closed
- On 6 November 2017, the Company closed borrowing a USD 98 million senior term loan from HPS Investment Partners, LLC, Riverstone Capital Partners, L.P. and AB Energy Opportunities L.P. secured by the Aneth Oil Field.
- Company also put in place substantial 3-year oil price hedging program to underpin senior debt financing
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About Elk Petroleum Limited
Elk Petroleum Limited (ASX:ELK) (OTCMKTS:EKPTF) is an oil and gas company specialising in Enhanced Oil Recovery (EOR), with assets located in one of the richest onshore oil regions of the USA, the Rocky Mountains. Elk's strategy is focused on applying proven EOR technologies to mature oil fields, which significantly de-risks the Company’s strategy of finding and exploiting oil field reserves.
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