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Bonterra Energy corporate update

Published by
World Pipelines,


Bonterra Energy Corp (Bonterra) is pleased to provide a corporate update with regard to its credit facilities, maintaining its CAN$0.15 monthly dividend per common share and its sustainability analysis during this period of continued low commodity prices.

Credit facilities maintained

The company's lenders have completed their mid year review and have agreed to maintain the credit facilities at the current CAN$425 million. The loan is revolving to 29 April 2016 with a maturity date of 30 April 2017. As of 30 September 2015 the drawn amount of the banks' loan is CAN$335 million. The company's total debt including working capital and other debt is approximately CAN$364 million.

Corporate sustainability

Assumptions are:

  • WTI oil prices of US$45 per bbl, a CAN/US dollar rate of $0.75, differential of US$2.00 and a quality adjustment of CAN$3.35 for a realised price for BNE of CAN$54.00 per bbl.
  • Natural gas liquids (NGL's) prices of CAN$23.
  • Natural gas prices of CAN$3.00 per million ft3, which includes a positive heat content adjustment of CAN$0.30.
  • Average production rate of 13 000 boe/d consisting of 68% oil, 6% NGL's and 26% natural gas.
  • All in corporate costs for royalties, operating costs, general/admin costs and interest of CAN$20 per boe.
  • Funds flow for a 12 month period of approximately CAN$109 million consisting of commodity sales of CAN$105 million and CAN$4 million from the sale of investments and dividend income.
  • Dividend payment of CAN$59 million (CAN$0.15 per share monthly dividend per share).
  • Capital expenditures of CAN$50 million.
  • Funds flow will change by CAN$16 million if oil prices change by CAN$5.00 per boe and natural gas and natural gas liquids prices remain constant.

Conclusion

The monthly dividend and capital expenditures are sustainable at the above referenced commodity prices. The capital expenditures are estimated to be sufficient to continue production levels in the range of approximately 13 000 boe/d if there aren't any serious pipeline restrictions, issues with non-operated facilities or voluntary reductions in production due to lower commodity prices. Minor fluctuations over a two or three month period from the above prices will not affect the dividend payments or the capital expenditures. Large price fluctuations or long term minor fluctuations will be dealt with. If funds flow increases the company may increase capital expenditures, dividends or pay down debt or a combination thereof. If funds flow decreases, the company may decrease capital expenditures or dividends.

Edited from source by Stephanie Roker

Read the article online at: https://www.worldpipelines.com/business-news/30102015/bonterra-energy-corporate-update/

 

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