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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| Frontera Energy Corporation | TSX:FEC | Toronto | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.06 | 0.83% | 7.31 | 7.19 | 7.43 | 7.37 | 7.30 | 7.37 | 26,315 | 21:11:03 |
Thursday 8 August 2024
Recorded an Income from Operations of $45.2 million and a Net Loss of $2.8 million
Generated Operating EBITDA of $110.3 Million and Cash Provided by Operating Activities of $149.8 Million
Delivered Average Daily Production of 39,912 Boe/d in Q2, Up 5% From the Prior Quarter, Including Average Daily Production of Approximately 40,600 Boe/d in June and July
Generated Quarterly Adjusted Infrastructure EBITDA of $27.8 Million and Segment Income of $14.6 Million
Began Construction of Strategic Reficar Connection, Expected to Become Operational in December 2024
Signed a 2-year Water Treatment Collaboration Agreement with Ecopetrol for the Quifa Block Via the SAARA Water Treatment Facility
Entered Into Collaboration Agreement Between Puerto Bahia and GASCO to Pursue LPG Project in Cartagena, Colombia
Declared Quarterly Dividend of C$0.0625 Per Share, or $3.9 Million in Aggregate, Payable on or around October 16, 2024
Announced Intention to Commence a $30 million Substantial Issuer Bid
CALGARY, AB, Aug. 7, 2024 /CNW/ - Frontera Energy Corporation (TSX: FEC) ("Frontera" or the "Company") today reported financial and operational results for the second quarter ended June 30, 2024. All financial amounts in this news release are in United States dollars, unless otherwise stated.
Gabriel de Alba, Chairman of the Board of Directors, commented:
"The Company continues to execute on its strategic priorities supporting the long-term growth and sustainability of its businesses. During the quarter, the Company finalized a 2-year agreement with Ecopetrol to treat and dispose water from the Quifa Block in its SAARA facility during a stabilization period of the plant, and today announced that we have broken ground on the construction of the connection project between Sociedad Portuaria Puerto Bahia S.A. ("Puerto Bahia") and Refineria de Cartagena S.A.S ("Reficar"), which the Company expects will become operational in December 2024. Following the end of the quarter, the Company also announced it executed an agreement with a leading Latin America energy provider, GASCO, that seeks to develop the lowest cost, liquefied petroleum gas ("LPG") import facilities for Colombia at Puerto Bahia.
Frontera also continues to take actions to unlock value for its stakeholders and remains committed to these efforts for the remainder of 2024 and beyond, including the ongoing strategic alternatives review processes. In addition to the quarterly dividend, I am pleased to announce the Company´s intention to commence a Substantial Issuer Bid ("the SIB") to purchase $30 million of the Company's outstanding shares, highlighting the strong financial results of the first half of 2024. So far this year, considering the proposed SIB, the Company is poised to return over $51 million of capital to our stakeholders, including $11.7 million in declared dividends, $6.7 million of common share repurchases and $3.5 million in buybacks of its 2028 unsecured notes."
Orlando Cabrales, Chief Executive Officer (CEO), Frontera, commented:
"Frontera's second quarter production and financial results build on our momentum from the first quarter and were in-line with our expectations. Operationally, the Company generated $110.3 million in quarterly Operating EBITDA, produced $27.8 million of Adjusted Infrastructure EBITDA, and finished the quarter with a total cash balance of $215.1 million.
Production increased by approximately 5% quarter over quarter, mainly driven by increased water disposal capacity in the CPE-6 and Quifa blocks, well interventions in the Sabanero block, expansion of gas compression facilities in the VIM-1 block, and the completion of two wells at the Perico block in Ecuador.
On the exploration side, with all pre-drill activities completed, we now expect to spud the high impact Hidra-1 prospect on the VIM-1 block in the third quarter of 2024. Following recent successes in Ecuador in the Perico block, the first (Espejo Sur B3) of two wells in Espejo has been completed showing initial gross production of 500bopd, spud of the second well (Espejo Norte A-1) took place at the end of July and drilling operations are on-going.
Despite some inflationary pressure on our costs, we remain on track to achieve our 2024 Capital, Production and EBITDA Guidance. We have increased production during the quarter, and in June and July, averaged production was approximately 40,600 barrels per day.
In our infrastructure business, ODL paid a first installment of dividend and return of capital of $31 million in April, approximately 50% of the total of $62.8 million expected for 2024. Operationally, ODL continues to maintain strong operating and financial performance with transported volumes increasing about 1% q-o-q and EBITDA reaching $68 million for the quarter. Puerto Bahia continues to move forward with its strategic agenda, breaking ground in the construction of the Reficar connection and achieving an important milestone with the start of horizontal directional drilling in the Canal del Dique in July, as well as announcing the GASCO LPG transaction. During the quarter, we also started-up and continue stabilizing our SAARA water treatment plant with a goal of reaching 250,000 barrels of water treated per day by the end of the year. During the month of June, the plant realized its first gross revenues associated to the water treatment collaboration agreement with the Quifa Block.
In our Guyana exploration business, the Company and its joint venture partner continues to engage in regular, constructive and collaborative conversations with the Government of Guyana. The Joint Venture, with support from investment bank and capital markets experts Houlihan Lokey, continues to actively pursue strategic options to unlock the potential of the Corentyne block."
Second Quarter 2024 Operational and Financial Summary:
Q2 2024 | Q1 2024 | Q2 2023 | ||
Operational Results | ||||
Heavy crude oil production (1) | (bbl/d) | 24,839 | 23,398 | 24,051 |
Light and medium crude oil production (1) | (bbl/d) | 12,583 | 12,580 | 15,188 |
Total crude oil production | (bbl/d) | 37,422 | 35,978 | 39,239 |
Conventional natural gas production (1) | (mcf/d) | 4,019 | 3,283 | 5,626 |
Natural gas liquids production (1) | (boe/d) | 1,785 | 1,639 | 1,823 |
Total production (2) | (boe/d) (3) | 39,912 | 38,193 | 42,049 |
Inventory Balance | ||||
Colombia | (bbl) | 758,794 | 683,335 | 881,758 |
Peru | (bbl) | 480,200 | 480,200 | 480,200 |
Ecuador | (bbl) | 80,195 | 115,228 | 72,550 |
Total Inventory | (bbl) | 1,319,189 | 1,278,763 | 1,434,508 |
Brent price Reference | ($/bbl) | 85.03 | 81.76 | 77.73 |
Produced crude oil and gas sales (4) | ($/boe) | 78.31 | 76.10 | 69.96 |
Purchased crude net margin (4) | ($/boe) | (2.13) | (2.39) | (2.05) |
Premiums paid on oil price risk management contracts (5) | ($/boe) | (1.32) | (1.27) | (0.80) |
Royalties (5) | ($/boe) | (2.01) | (1.64) | (3.02) |
Net sales realized price (4) | ($/boe) | 72.85 | 70.80 | 64.09 |
Production costs (excluding energy cost), net of realized FX hedge impact (4) | ($/boe) | (10.79) | (10.21) | (8.45) |
Energy costs, net of realized FX hedge impact (4) | ($/boe) | (4.74) | (5.29) | (3.94) |
Transportation costs, net of realized FX hedge impact (4) | ($/boe) | (10.92) | (11.33) | (10.89) |
Operating netback per boe (4) | ($/boe) | 46.40 | 43.97 | 40.81 |
Financial Results | ||||
Purchased Crude oil and gas sales | ($M) | 224,646 | 209,043 | 227,923 |
Purchased crude net margin | ($M) | (6,118) | (6,574) | (6,705) |
Premiums paid on oil price risk management contracts | ($M) | (3,796) | (3,489) | (2,600) |
Royalties | ($M) | (5,774) | (4,506) | (9,837) |
Net sales (6) | ($M) | 208,958 | 194,474 | 208,781 |
Net (loss) income (7) | ($M) | (2,846) | (8,503) | 80,207 |
Per share – basic | ($) | (0.03) | (0.10) | 0.94 |
Per share – diluted | ($) | (0.03) | (0.10) | 0.92 |
General and administrative | ($M) | 12,928 | 13,556 | 12,422 |
Outstanding Common Shares | Number of shares | 84,253,816 | 84,693,416 | 85,188,573 |
Operating EBITDA (6) | ($M) | 110,321 | 97,248 | 116,461 |
Cash provided by operating activities | ($M) | 149,787 | 65,616 | 183,560 |
Capital expenditures (6) | ($M) | 80,198 | 69,381 | 154,860 |
Cash and cash equivalents - unrestricted | ($M) | 180,659 | 154,907 | 180,294 |
Restricted cash short and long-term (8) | ($M) | 34,419 | 27,058 | 33,485 |
Total cash (8) | ($M) | 215,078 | 181,965 | 213,779 |
Total debt and lease liabilities (8) | ($M) | 523,994 | 537,151 | 532,273 |
Consolidated total indebtedness (Excl. Unrestricted Subsidiaries) (9) | ($M) | 426,004 | 429,556 | 415,395 |
Net Debt (Excluding Unrestricted Subsidiaries) (9) | ($M) | 283,651 | 305,821 | 286,675 |
(1) | References to heavy crude oil, light and medium crude oil combined, conventional natural gas and natural gas liquids in the above table and elsewhere in the press release refer to the heavy crude oil, light crude oil and medium crude oil combined, conventional natural gas and natural gas liquids, respectively, product types as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities. |
(2) | Represents W.I. production before royalties. Refer to the "Further Disclosures" section on page 35 of the Company's management's discussion and analysis the three months ended June 30, 2024 ("MD&A"). |
(3) | Boe has been expressed using the 5.7 to 1 Mcf/bbl conversion standard required by the Colombian Ministry of Mines & Energy. Refer to the "Further Disclosures - Boe Conversion" section on page 35 of the MD&A. |
(4) | Non-IFRS ratio (equivalent to a "non-GAAP ratio", as defined in National Instrument 52-112 - Non-GAAP and Other Financial Measures Disclosure ("NI 52-112"). Refer to the "Non-IFRS and Other Financial Measures'' section on page 22 of the MD&A. |
(5) | Supplementary financial measure (as defined in NI 52-112). Refer to the "Non-IFRS and Other Financial Measures'' section on page 22 of the MD&A. |
(6) | Non-IFRS financial measure (equivalent to a "non-GAAP financial measure", as defined in NI 52-112). Refer to the "Non-IFRS and Other Financial Measures'' section on page 22 of the MD&A. |
(7) | Net (loss) income attributable to equity holders of the Company. |
(8) | Capital management measure (as defined in NI 52-112). Refer to the "Non-IFRS and Other Financial Measures'' section on page 22 of the MD&A. |
(9) | "Unrestricted Subsidiaries" include CGX Energy Inc, listed on the TSX Venture Exchange under the trading symbol "OYL", Frontera ODL Holding Corp., including its subsidiary Pipeline Investment Ltd. ("PIL"), Frontera BIC Holding Ltd. and Frontera Bahía Holding Ltd. ("Frontera Bahia"), including Puerto Bahia. On April 11, 2023, Frontera Energy Guyana Holding Ltd. and Frontera Energy Guyana Corp. were designated as unrestricted subsidiaries. Refer to the "Liquidity and Capital Resources" section on page 28 of the MD&A. |
Second Quarter 2024 Operational and Financial Results:
Q2 2024 | Q1 2024 | Q2 2023 | ||
Heavy crude oil production (bbl/d) | 24,839 | 23,398 | 24,051 | |
Light and medium crude oil production (bbl/d) | 12,583 | 12,580 | 15,188 | |
Conventional natural gas production (mcf/d) | 4,019 | 3,283 | 5,626 | |
Natural gas liquids production(boe/d) | 1,785 | 1,639 | 1,823 | |
Total production | 39,912 | 38,193 | 42,049 |
Heavy crude oil production increased approximately 6% quarter-over-quarter mainly due to increased water disposal capacity from a new injector well in the Quifa block, the start-up of the SAARA plant during the month of May, increased water handling capacity in CPE-6 and additional activities in the Sabanero block. Conventional natural gas and natural gas liquids increased 22% and 9% quarter over quarter respectively due to increased production at the La Belleza field in connection with the compression facilities expansion and gas reinjection project. Light and medium crude oil production was flat compared to the prior quarter benefited by an increase in Ecuador production from the Perico Norte 6 and Perico Centro 2 coming online offset by natural declines in the Colombian light and medium crude oil fields.
Frontera's Sustainability Strategy
As of June 30, 2024, Frontera has achieved 48% of its sustainability goals for the year. During the second quarter, Frontera expanded its protection and preservation coverage activities to 168 hectares.
The Company invested $498,000 in projects in communities near its operations in Colombia, Ecuador and Guyana and purchased 10.7% of its total goods and services from local suppliers.
Working from a strong and established human rights base, Frontera continues to improve its human rights due diligence planning to promote and respect human rights across its value chain.
Enhancing Shareholder Returns
Below we highlight the status of our strategic value enhancing initiatives to date. The Company continues to consider future shareholder initiatives in 2024 and beyond, including potential additional dividends, share buybacks, distributions, or bond buybacks, based on the overall results of our businesses, cash flow generation and the Company's strategic goals.
NCIB: Under the Company's current NCIB which commenced on November 21, 2023, Frontera is authorized to repurchase for cancellation up to 3,949,454 of its common shares ("Common Shares"). As of August 7, 2024, the Company has repurchased approximately 1,387,100 Common Shares for cancellation for approximately $8.4 million.
SIB: On August 7, the Company announced its intention to commence the SIB pursuant to which the Company will offer to purchase $30 million of its Common Shares for cancellation at a fixed price per share. The Company intends to fund the SIB from current cash resources.
The Company intends to determine the terms of the SIB, including pricing, in due course, and expects that the SIB will be completed in October 2024. Commencement and/or completion of the SIB is subject to receipt of a satisfactory liquidity opinion from a qualified financial adviser, approval of the Board of Directors, and obtaining any necessary exemptive relief under applicable securities laws in Canada. The SIB will not be conditional upon any minimum number of shares being tendered and will be subject to conditions customary for transactions of this nature.
Dividend: Pursuant to Frontera's dividend policy, Frontera's Board of Directors has declared a dividend of C$0.0625 per Common Share to be paid on or around October 16, 2024, to shareholders of record at the close of business on October 2, 2024. Year to date, Frontera has declared $11.7 million in dividends to shareholders.
This dividend payment to shareholders is designated as an "eligible dividend" for purposes of the Income Tax Act (Canada). This dividend is eligible for the Company's Dividend Reinvestment Plan to provide shareholders of Frontera who are resident in Canada with the option to have the cash dividends declared on their common shares reinvested automatically back into additional common shares, without the payment of brokerage commissions or services charges.
Bond Buybacks: During the three months ended June 30, 2024, the Company repurchased in the open market $2 million of its 2028 Unsecured Notes for cash consideration of $1.6 million including interest payable of $0.1 million. As a result, the Company recognized a gain of $0.4 million. The carrying value for the 2028 Unsecured Notes as of June 30, 2024, is $390.7 million. Year-to-date, the Company has repurchased $3.5 million of its 2028 Unsecured Notes.
Strategic Alternatives Review Processes: In May 2024, the Company launched a strategic alternatives review for its standalone and growing Colombian Infrastructure Business, which could result in a potential spin-off to Frontera shareholders, a total or partial sale or other business combination of Frontera's Colombian Infrastructure Business, and/or a strategic investment, therein by a third party. Frontera has retained Goldman Sachs & Co. LLC as financial advisor and may retain other advisors to assist the Board in evaluating the various strategic, business, and financial alternatives.
In our Guyana exploration business, the Joint Venture and the Government of Guyana have engaged in regular, constructive and collaborative conversations throughout the Joint Venture's tenure on the Corentyne block, including discussions regarding conditions and timing under which further activities could be performed by the Joint Venture in the Corentyne block. The Joint Venture, with support from investment bank and capital markets experts Houlihan Lokey, continues to actively pursue strategic options to unlock the potential of the Corentyne block.
These processes are central to the Company's efforts to streamline the business and unlock the value from the sum of its parts. Frontera believes the value of these assets is not reflected in the Company's current share price and these processes aim to drive value for shareholders. There can be no guarantee that these strategic alternatives review processes will result in a transaction.
Frontera's Three Core Businesses
Frontera's three core businesses include: (1) its Colombia and Ecuador Upstream Onshore business, (2) its standalone and growing Colombian Infrastructure business, and (3) its potentially transformational Guyana Exploration business offshore Guyana.
Colombia & Ecuador Upstream Onshore
Colombia
During the second quarter of 2024, Frontera produced 38,257 boe/d from its Colombian operations (consisting of 24,839 bbl/d of heavy crude oil, 10,928 bbl/d of light and medium crude oil, 4,019 mcf/d of conventional natural gas and 1,785 boe/d of natural gas liquids).
In the second quarter of 2024, the Company drilled 28 development wells at its Quifa SW, Cajua and CPE-6 fields and well interventions at 32 others.
Currently, the Company has 3 drilling rigs and 4 intervention rigs active at its Quifa, CPE-6, Cravoviejo, Corcel-Guatiquia and Arrendajo blocks in Colombia.
Quifa Block: Quifa SW and Cajua
At Quifa, second quarter 2024 production averaged 17,371 bbl/d of heavy crude oil (including both Quifa and Cajua). The Company drilled 22 wells in the block during the second quarter of 2024. The Company also invested in facilities for a second injector well in 2024.
Year to date, the Company has handled an average of approximately 1.6 million barrels of water per day in Quifa.
During the quarter, Frontera and Ecopetrol entered into a two-year contract to treat and dispose water from the Quifa Block at the SAARA facility. Following the deal with Ecopetrol, Frontera restarted operations at the SAARA facility, currently processing approximately 50,000 barrels of water per day.
CPE-6
At CPE-6, second quarter 2024 production averaged approximately 6,947 bbl/d of heavy crude oil, increasing 12% from 6,228 bbl/d during the first quarter of 2024. The Company drilled 6 development wells. Additionally, the Company invested to expand and improve water-handling capacity at the CPE-6 block.
The Company's current water handling capacity in CPE-6 is approximately 300 thousand bwpd, on track to increase to 360 thousand bwpd by year-end.
Other Colombia Developments
At Guatiquia, production during the second quarter 2024 averaged 5,539 bbl/d of light and medium crude compared with 5,610 bbl/d in the first quarter of 2024.
In the Cubiro block production averaged 1,491 bbl/d of light and medium crude oil in the second quarter of 2024 compared with 1,461 bbl/d in the first quarter 2024.
At VIM-1 (Frontera 50% W.I., non-operator), production averaged 1,856 boe/d of light and medium crude oil in the second quarter of 2024 compared to approximately 1,579 boe/d of light and medium crude oil in the first quarter of 2024. Additionally, the Company invested in the expansion of the gas compression facilities to increase processing capacity from 20,000 to 30,000 Mcf/day in the block.
At the Sabanero block, the Company invested in the central processing facility funded primarily through an reimbursement from insurance claims related to the Sabanero block.
Colombia Exploration Assets
In the VIM-1 block, pre-drilling activity finished at the Hidra-1 exploratory well, and rig mobilization and spudding of the well expected for the third quarter of 2024. In the Llanos-119 block, the Company acquired 80 sqkm of 3D seismic during the second quarter of 2024 and also engaged in pre-seismic and social and environmental studies in the Llanos-99 block.
Ecuador
In Ecuador, second quarter 2024 production averaged approximately 1,655 bbl/d of light and medium crude oil compared to 1,478 bbl/d in the prior quarter. In the Perico block, the Company completed the Perico Norte 6 well and the Perico Centro 2 well.
In the Espejo block, the Espejo Sur- B3 well, was drilled during the second quarter of 2024, reaching a total depth 10,090 feet MD. Integration of core, and logging while drilling (LWD) and pressure data interpreted 17 feet of net pay in the Lower U Sand, currently producing approximately 500 bbl/d gross. In Espejo Norte A-1 (previously Espejo Centro-1) the well was spud on July 28, 2024, and drilling operations are on-going; the main target is M1 Sand and the secondary target is Lower U Sand.
2. Infrastructure Colombia
Frontera's Infrastructure Colombia Segment includes the Company's 35% equity interest in the ODL pipeline through Frontera's wholly owned subsidiary, PIL and the Company's 99.97% interest in Puerto Bahia. Starting in 2024, the Infrastructure Colombia Segment also include the Company's reverse osmosis water treatment facility (SAARA) and its palm oil plantation (ProAgrollanos).
The Company continues to execute on its strategic priorities supporting the long-term growth and sustainability of its businesses. Subsequent to the quarter, Puerto Bahia began construction of its strategic Reficar Connection Project, which it expects will become operational in December 2024.
Additionally, on July 22, 2024, Frontera announced that its subsidiary, Puerto Bahia and GASCO had entered into a Framework Collaboration Agreement to jointly pursue a LPG project at the Puerto Bahia port. The estimated cost of the project is expected to be approximately $50 to $60 million, which will be shared between Puerto Bahia and GASCO. Puerto Bahia's contributions are expected to be largely in-kind, and the project is expected to be in service by 2027.
During the quarter, Frontera and Ecopetrol entered into a two-year contract to treat and dispose water from the Quifa Block at Frontera's SAARA facility. This agreement is set to significantly improve water disposal operations and drive crude oil production capacity at the Quifa Block. By the end of 2024, the company aims to increase processing capacity at SAARA to 250,000 barrels per day, which support higher production levels from the Quifa block. During the month of June, the plant realized its first gross revenues associated to the water treatment collaboration agreement with the Quifa Block. In connection with this agreement, SAARA is committed to enhancing the infrastructure necessary to provide additional irrigation source water for the ProAgrollanos palm oil plantation.
Infrastructure Colombia Segment Results
Adjusted Infrastructure EBITDA in the second quarter of 2024 was $27.8 million, compared with $25.7 million during the first quarter of 2024. The increase was mainly due to improved performance at Puerto Bahia driven by higher liquids volumes and cost optimizations, and greater sales volumes and revenues Proagrollanos during the quarter.
Three months | ||
($M) | 2024 | 2023 |
Adjusted Infrastructure Revenue (1) | 43,055 | 42,989 |
Adjusted Infrastructure Operating Cost (1) | (11,998) | (11,589) |
Adjusted Infrastructure General and Administrative (1) | (3,234) | (2,888) |
Adjusted Infrastructure EBITDA (1) | 27,823 | 28,512 |
(1) | Non-IFRS financial measure |
Segment capital expenditures for the three months ended June 30, 2024, were $3.5 million mainly related to investments in the SAARA project and investments at Puerto Bahia including (i) general cargo terminal upgrades and expansion, (ii) tank major maintenance, and (iii) right of way and engineering expenditure associated to the Reficar Connection Project.
Three months ended | ||
($M) | 2024 | 2023 |
Revenue | 12,894 | 12,883 |
Costs | (7,598) | (8,015) |
General and Administrative expenses | (1,389) | (1,540) |
Depletion, depreciation and amortization | (1,962) | (1,534) |
Restructuring, severance and other costs | (732) | (700) |
Infrastructure (loss) income from operations | 1,213 | 1,094 |
Share of Income from associates - ODL | 13,407 | 14,345 |
Infrastructure Colombia Segment Income | 14,620 | 15,439 |
Infrastructure Colombia Segment cash flow from operating activities | 29,922 | 20,129 |
Capital Expenditures Infrastructure Colombia segment (1) | 3,467 | 1,456 |
(1) | Non-IFRS financial measures (equivalent to a "non-GAAP financial measures", as defined in NI 52-112). Refer to the "Non-IFRS and Other Financial Measures'' section on page 22 of the MD&A. |
The following table shows the volumes pumped per injection point in ODL:
Three months ended | ||
(bbl/d) | 2024 | 2023 |
At Rubiales Station | 172,163 | 170,474 |
At Jagüey and Palmeras Station | 77,033 | 73,016 |
Total | 249,196 | 243,490 |
The following table shows throughput for the liquids port facility at Puerto Bahia:
Three months ended | ||
(bbl/d) | 2024 | 2023 |
FEC volumes | 13,353 | 14,267 |
Third party volumes | 48,445 | 59,447 |
Total | 61,798 | 73,714 |
The following table shows the barrels of water per day treated and irrigated in SAARA and field performance indicators for Proagrollanos:
Three months | |||
2024 | 2023 | ||
Fresh fruit bunch from palm oil (produced - sold) | (tons) | 8,895 | 7,582 |
Production per hectare per year (1) | (tons/ ha/year) | 7.42 | 6.64 |
Palm oil fruit price | ($/ton) | 166 | 162 |
Volumes of reverse osmosis water treated | (bwpd) | 22,097 | 43,375 |
Volumes of water irrigated in palm oil cultivation | (bwpd) | 14,398 | 33,855 |
(1) | Tons per hectare per are calculated using the total production for the last twelve months ended June 30. |
Hedging Update
As part of its risk management strategy, Frontera uses derivative commodity instruments to manage exposure to price volatility by hedging a portion of its oil production. The Company's strategy aims to protect 40-60% of its estimated net after royalties' production using a combination of instruments, capped and non-capped, to protect the revenue generation and cash position of the Company, while maximizing the upside, thereby allowing the Company to take a more dynamic approach to the management of its hedging portfolio.
The following table summarizes Frontera's hedging position as of August 7, 2024.
Term | Type of | Positions (bbl/d) | Strike Prices Put/Call |
Jul 24 | Put | 14,581 | 75.00 |
Aug 24 | Put | 13,871 | 76.50 |
Sep 24 | Put | 13,667 | 78.00 |
3Q-2024 | Total Average | 14,043 | |
Oct 24 | Put | 13,613 | 78.00 |
Nov 24 | Put | 14,067 | 78.00 |
4Q-2024 | Total Average | 9,174 |
The Company is exposed to foreign currency fluctuations primarily arising from expenditures that are incurred in COP and its fluctuation against the USD. As of August 7, 2024, the Company had the following foreign currency derivatives contracts:
Term | Type of Instrument | Open Interest (US$ MM) | Strike Prices Put/Call | Hedging Ratio |
3Q-2024 | Zero Cost Collars | 60 | 4,010/ 4,172 | 40 % |
4Q-2024 | Zero Cost Collars | 30 | 4,100/ 4,484 | 20 % |
Aug 2024 | Forward (1) | 12 | 4,044.00 | |
Oct 2024 | Forward (2) | 17 | 4,386.00 | |
Oct 2024 | Forward (1) | 9 | 4,078.00 | |
Dec 2024 | Forward (1) | 9 | 4,115.00 |
(1) | Hedges associated with ODL's declared capital distributions |
(2) | Hedge associated with the repayment in COP of the Bancolombia working capital loan |
CRA 2016 Settlement
On July 12, 2024, Frontera entered into Minutes of Settlement with the Canadian Minister of National Revenue to resolve a dispute in connection with the Company´s 2016 restructuring process and relating to, among other things, the fair market value of the Company's Common Shares as at November 2, 2016, the computation of the net capital losses and the computation of non-capital losses of the Company in respect of its taxation year ending December 31, 2016 (the "Settlement").
The Settlement may result in a decrease in the net capital losses of the Company, as last reported in the 2023 Annual Consolidated Financial Statements, and an increase in the computed amount of the historical paid-up capital in respect of the Common Shares, which could impact the quantum of dividends deemed to have been received by certain shareholders of Frontera in respect of the repurchase of Common Shares pursuant to the Company's substantial issuer bid that was completed on August 11, 2022. The Company is currently assessing the impact of the Settlement on the computation of the historical paid-up capital in respect of the Common Shares and will provide an update to affected shareholders once such assessment has been completed.
Second Quarter 2024 Conference Call Details
A Conference call for investors and analysts will be held on Thursday, August 8, 2024, at 11:00 a.m. Eastern Time. Participants will include Gabriel de Alba, Chairman of the Board of Directors, Orlando Cabrales, Chief Executive Officer, Rene Burgos, Chief Financial Officer, and other members of the senior management team.
Analysts and investors are invited to participate using the following dial-in numbers:
RapidConnect URL: | https://emportal.ink/467YJgY |
Participant Number (Toll Free North America): | 1-888-664-6383 |
Participant Number (Toll Free Colombia): | 01-800-518-4036 |
Participant Number (International): | 1-416-764-8650 |
Conference ID: | 70673304 |
Webcast Audio: | www.fronteraenergy.ca |
A replay of the conference call will be available until 11:59 p.m. Eastern Time on August 15, 2024.
Encore Toll free Dial-in Number: | 1-416-764-8677 |
International Dial-in Number: | 1-888-390-0541 |
Encore ID: | 673304 |
About Frontera:
Frontera Energy Corporation is a Canadian public company involved in the exploration, development, production, transportation, storage and sale of oil and natural gas in South America, including related investments in both upstream and midstream facilities. The Company has a diversified portfolio of assets with interests in 23 exploration and production blocks in Colombia, Ecuador and Guyana, and pipeline and port facilities in Colombia. Frontera is committed to conducting business safely and in a socially, environmentally and ethically responsible manner.
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Advisories:
Cautionary Note Concerning Forward-Looking Statements
This news release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, the Company's strategic alternatives review process for its Colombian Infrastructure business and its interests in the Corentyne block in Guyana including a possible farm down, the Company's belief that the value of its assets is not reflected in the current stock price and the ability of such strategic processes to drive value for shareholders, the Company's goal of enhancing shareholder value by returning capital to security holders, the Company's current intentions regarding commencement of the SIB, the amount of capital returned to shareholders under the SIB, the timing of completion of the SIB, the terms of the SIB and the Company's intention to announce further details regarding the SIB, the Company's intent to consider future shareholder initiatives, the timing of the completion of the connection project between Puerto Bahia and Reficar, the future water handling capacity in CPE-6, the Company's exploration and development plans and objectives, including its drilling plans and seismic acquisition campaign and the timing thereof, estimates and/or assumptions in respect of the Company's capital expenditure program (including Company's guidance), production levels, profitability, costs, future income generation capacity, cash levels (including the timing and ability to release restricted cash), regulatory approval, and the Company's hedging program and its ability to mitigate the impact of changes in oil prices) are forward-looking statements.
These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: the ability of the Company to successfully conclude on a timely basis or at all one or both of its strategic review processes; volatility in market prices for oil and natural gas; uncertainties associated with estimating and establishing oil and natural gas reserves and resources; liabilities inherent with the exploration, development, exploitation and reclamation of oil and natural gas; uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; increases or changes to transportation costs; expectations regarding the Company's ability to raise capital and to continually add reserves through acquisition and development; the Company's ability to access additional financing; the ability of the Company to maintain its credit ratings; the ability of the Company to: meet its financial obligations and minimum commitments, fund capital expenditures and comply with covenants contained in the agreements that govern indebtedness; political developments in the countries where the Company operates; the uncertainties involved in interpreting drilling results and other geological data; geological, technical, drilling and processing problems; timing on receipt of government approvals; fluctuations in foreign exchange or interest rates and stock market volatility and the other risks disclosed under the heading "Risk Factors" and elsewhere in the Company's annual information form dated March 7, 2024 filed on SEDAR+ at www.sedarplus.ca.
Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
This news release contains future oriented financial information and financial outlook information (collectively, "FOFI") (including, without limitation, statements regarding expected average production), and are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraph. The FOFI has been prepared by management to provide an outlook of the Company's activities and results, and such information may not be appropriate for other purposes. The Company and management believe that the FOFI has been prepared on a reasonable basis, reflecting management's reasonable estimates and judgments, however, actual results of operations of the Company and the resulting financial results may vary from the amounts set forth herein. Any FOFI speaks only as of the date on which it is made, and the Company disclaims any intent or obligation to update any FOFI, whether as a result of new information, future events or results or otherwise, unless required by applicable laws.
No offer or Solicitation
The SIB referred to in this news release has not yet commenced. This news release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Common Shares. The solicitation and the offer to buy Common Shares will only be made pursuant to a formal offer to purchase and issuer bid circular, a letter of transmittal, a notice of guaranteed delivery and other related documents to be filed with the applicable Canadian securities regulatory authorities. The offer to purchase pursuant to the SIB will not be made to, nor will tenders be accepted from or on behalf of, holders of Common Shares in any jurisdiction in which the making or acceptance of offers to sell Common Shares would not be in compliance with the laws of that jurisdiction.
Non-IFRS Financial Measures
This press release contains various "non-IFRS financial measures" (equivalent to "non-GAAP financial measures", as such term is defined in NI 52-112), "non-IFRS ratios" (equivalent to "non-GAAP ratios", as such term is defined in NI 52-112), "supplementary financial measures" (as such term is defined in NI 52-112) and "capital management measures" (as such term is defined in NI 52-112), which are described in further detail below. Such measures do not have standardized IFRS definitions. The Company's determination of these non-IFRS financial measures may differ from other reporting issuers and they are therefore unlikely to be comparable to similar measures presented by other companies. Furthermore, these financial measures should not be considered in isolation or as a substitute for measures of performance or cash flows as prepared in accordance with IFRS. These financial measures do not replace or supersede any standardized measure under IFRS. Other companies in our industry may calculate these measures differently than we do, limiting their usefulness as comparative measures.
The Company discloses these financial measures, together with measures prepared in accordance with IFRS, because management believes they provide useful information to investors and shareholders, as management uses them to evaluate the operating performance of the Company. These financial measures highlight trends in the Company's core business that may not otherwise be apparent when relying solely on IFRS financial measures. Further, management also uses non-IFRS measures to exclude the impact of certain expenses and income that management does not believe reflect the Company's underlying operating performance. The Company's management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period and to prepare annual operating budgets and as a measure of the Company's ability to finance its ongoing operations and obligations.
Set forth below is a description of the non-IFRS financial measures, non-IFRS ratios, supplementary financial measures and capital management measures used in the MD&A.
Operating EBITDA
EBITDA is a commonly used non-IFRS financial measure that adjusts net income as reported under IFRS to exclude the effects of income taxes, finance income and expenses, and DD&A. Operating EBITDA is a non-IFRS financial measure that represents the operating results of the Company's primary business, excluding the following items: restructuring, severance and other costs, post-termination obligation, payments of minimum work commitments and, certain non-cash items (such as impairments, foreign exchange, unrealized risk management contracts, and share-based compensation) and gains or losses arising from the disposal of capital assets. In addition, other unusual or non-recurring items are excluded from operating EBITDA, as they are not indicative of the underlying core operating performance of the Company.
A reconciliation of Operating EBITDA to net loss (income) is as follows:
Three Months Ended June 30 | ||
($M) | 2024 | 2023 |
Net loss (income) | (2,846) | 80,207 |
Finance Income | (1,816) | (1,472) |
Finance expenses | 17,429 | 15,688 |
Income tax expense | 32,659 | 2,605 |
Depletion, depreciation and amortization | 63,188 | 81,389 |
Expense (recovery) of asset retirement obligation | 45 | (40,562) |
Expenses of impairment | 392 | 4,662 |
Post-termination obligation | (364) | 6,120 |
Shared-based compensation | 754 | 1,035 |
Restructuring, severance and other cost | 1,052 | 1,825 |
Share of income from associates | (13,407) | (14,345) |
Foreign exchange loss (gain) | 7,518 | (17,006) |
Other loss, net | 2,774 | 716 |
Unrealized loss (gain) on risk management contracts | 3,646 | (4,057) |
Non-controlling interests | (288) | (344) |
Gain on repurchased 2028 Unsecured Notes | (415) | — |
Operating EBITDA | 110,321 | 116,461 |
Capital Expenditures
Capital expenditures is a non-IFRS financial measure that reflects the cash and non-cash items used by the Company to invest in capital assets. This financial measure considers oil and gas properties, plant and equipment, infrastructure, exploration and evaluation assets expenditures which are items reconciled to the Company's Statements of Cash Flows for the period.
Three Months Ended June 30 | ||
($M) | 2024 | 2023 |
Consolidated Statements of Cash Flows | ||
Additions to oil and gas properties, infrastructure port, and plant and equipment | 87,033 | 66,166 |
Additions to exploration and evaluation assets | 10,467 | 88,924 |
Total Additions in Consolidated Statements of Cash Flows | 97,500 | 155,090 |
Non-cash adjustments (1) | (17,302) | (230) |
Total Capital Expenditures | 80,198 | 154,860 |
Capital Expenditures attributable to Infrastructure Colombia Segment | 3,467 | 1,456 |
Capital Expenditures attributable to other segments different to Infrastructure Colombia Segment | 76,731 | 153,404 |
Total Capital Expenditure | 80,198 | 154,860 |
(1) | Related to material inventory movements, capitalized non-cash items and other adjustments |
Infrastructure Colombia Calculations
Each of Adjusted Infrastructure Revenue, Adjusted Infrastructure Operating Costs and Adjusted Infrastructure General and Administrative, is a non-IFRS financial measure, and each is used to evaluate the performance of the Infrastructure Colombia Segment operations. Adjusted Infrastructure Revenue includes revenues of the Infrastructure Colombia Segment including ODL's revenue direct participation interest. Adjusted Infrastructure Operating Costs includes costs of the Infrastructure Colombia Segment including ODL's cost direct participation interest. Adjusted Infrastructure General and Administrative includes general and administrative costs of the Infrastructure Colombia Segment including ODL's general and administrative direct participation interest.
A reconciliation of each of Adjusted Infrastructure Revenue, Adjusted Infrastructure Operating Costs and Adjusted Infrastructure General and Administrative is provided below.
Three Months Ended June 30 | ||
($M) | 2024 | 2023 |
Revenue Infrastructure Colombia Segment | 12,894 | 12,883 |
Revenue from ODL | 86,174 | 86,017 |
Direct participation interest in the ODL | 35 % | 35 % |
Equity adjustment participation of ODL (1) | 30,161 | 30,106 |
Adjusted Infrastructure Revenues | 43,055 | 42,989 |
Operating Cost Infrastructure Colombia Segment | (7,598) | (8,015) |
Operating Cost from ODL | (12,572) | (10,212) |
Direct participation interest in the ODL | 35 % | 35 % |
Equity adjustment participation of ODL (1) | (4,400) | (3,574) |
Adjusted Infrastructure Operating Costs | (11,998) | (11,589) |
General and administrative Infrastructure Colombia Segment | (1,389) | (1,540) |
General and administrative from ODL | (5,270) | (3,850) |
Direct participation interest in the ODL | 35 % | 35 % |
Equity adjustment participation of ODL (1) | (1,845) | (1,348) |
Adjusted Infrastructure General and Administrative | (3,234) | (2,888) |
(1) | Revenues and expenses related to the ODL are accounted for using the equity method described in the Note 12 of the Interim Condensed Consolidated Financial Statements. |
Adjusted Infrastructure EBITDA
The Adjusted Infrastructure EBITDA is a non-IFRS financial measure used to assist in measuring the operating results of the Infrastructure Colombia Segment business.
Three months | ||
($M) | 2024 | 2023 |
Adjusted Infrastructure Revenue (1) | 43,055 | 42,989 |
Adjusted Infrastructure Operating Cost (1) | (11,998) | (11,589) |
Adjusted Infrastructure General and Administrative (1) | (3,234) | (2,888) |
Adjusted Infrastructure EBITDA (1) | 27,823 | 28,512 |
(1) | Non-IFRS financial measure |
Net Sales
Net sales is a non-IFRS financial measure that adjusts revenue to include realized gains and losses from oil risk management contracts while removing the cost of any volumes purchased from third parties. This is a useful indicator for management, as the Company hedges a portion of its oil production using derivative instruments to manage exposure to oil price volatility. This metric allows the Company to report its realized net sales after factoring in these oil risk management activities. The deduction of cost of purchases is helpful to understand the Company's sales performance based on the net realized proceeds from its own production, the cost of which is partially recovered when the blended product is sold. Net sales also exclude sales from port services, as it is not considered part of the oil and gas segment. Refer to the reconciliation in the "Sales" section on page 10 of the MD&A.
Operating Netback and Oil and Gas Sales, Net of Purchases
Operating netback is a non-IFRS financial measure and operating netback per boe is a non-IFRS ratio. Operating netback per boe is used to assess the net margin of the Company's production after subtracting all costs associated with bringing one barrel of oil to the market. It is also commonly used by the oil and gas industry to analyze financial and operating performance expressed as profit per barrel and is an indicator of how efficient the Company is at extracting and selling its product. For netback purposes, the Company removes the effects of any trading activities and results from its Infrastructure Colombia Segment from the per barrel metrics and adds the effects attributable to transportation and operating costs of any realized gain or loss on foreign exchange risk management contracts. Refer to the reconciliation in the "Operating Netback" section on page 9.
The following is a description of each component of the Company's operating netback and how it is calculated. Oil and gas sales, net of purchases, is a non-IFRS financial measure that is calculated using oil and gas sales less the cost of volumes purchased from third parties including its transportation and refining costs. Oil and gas sales, net of purchases per boe, is a non-IFRS ratio that is calculated using oil and gas sales, net of purchases, divided by the total sales volumes, net of purchases. A reconciliation of this calculation is provided below:
Three months ended June 30 | Six months ended June 30 | |||
2024 | 2023 | 2024 | 2023 | |
Purchased crude oil and products sales ($M)(1) | 224,646 | 227,923 | 433,689 | 425,014 |
Purchased crude net margin ($M) | (6,118) | (6,705) | (12,692) | (14,676) |
Oil and gas sales, net of purchases ($M) | 218,528 | 221,218 | 420,997 | 410,338 |
Sales volumes, net of purchases - (boe) | 2,868,593 | 3,257,709 | 5,615,246 | 5,996,168 |
Produced crude oil and gas sales ($/boe) | 78.31 | 69.96 | 77.23 | 70.88 |
Oil and gas sales, net of purchases ($/boe) | 76.18 | 67.91 | 74.97 | 68.43 |
(1) | Excludes sales from port services as they are not part of the oil and gas segment. For further information, refer to the "Infrastructure Colombia" section on page 18. |
Non-IFRS Ratios
Realized oil price, net of purchases, and realized gas price per boe
Realized oil price, net of purchases, and realized gas price per boe are both non-IFRS ratios. Realized oil price, net of purchases, per boe is calculated using oil sales net of purchases, divided by total sales volumes, net of purchases. Realized gas price is calculated using sales from gas production divided by the conventional natural gas sales volumes.
Three months ended June 30 | Six months ended June 30 | |||
2024 | 2023 | 2024 | 2023 | |
Oil and gas sales, net of purchases ($M) (1) | 218,528 | 221,218 | 420,997 | 410,338 |
Crude oil sales volumes, net of purchases - (bbl) | 2,804,205 | 3,169,231 | 5,498,687 | 5,776,594 |
Conventional natural gas sales volumes - (mcf) | 366,869 | 504,166 | 665,013 | 1,249,960 |
Realized oil price, net of purchases ($/bbl) | 77.16 | 68.90 | 75.83 | 69.90 |
Realized conventional natural gas price ($/mcf) | 5.88 | 5.65 | 6.05 | 5.29 |
(1) | Non-IFRS financial measure. |
Net sales realized price
Net sales realized price is a non-IFRS ratio that is calculated using net sales (including oil and gas sales net of purchases, realized gains and losses from oil risk management contracts and less royalties). Net sales realized price per boe is a non-IFRS ratio which is calculated dividing each component by total sales volumes, net of purchases. A reconciliation of this calculation is provided below:
Three months | ||
($M) | 2024 | 2023 |
Oil and gas sales, net of purchases ($M) (1) | 218,528 | 221,218 |
(-) Premiums paid on oil price risk management contracts ($M) | (3,796) | (2,600) |
(-) Royalties ($M) | (5,774) | (9,837) |
Net Sales ($M) | 208,958 | 208,781 |
Sales volumes, net of purchases (boe) | 2,868,593 | 3,257,709 |
Oil and gas sales, net of purchases ($/boe) | 76.18 | 67.91 |
Premiums paid on oil price risk management contracts ($/boe) (2) | (1.32) | (0.80) |
Royalties ($/boe) (2) | (2.01) | (3.02) |
Net sales realized price ($/boe) | 72.85 | 64.09 |
(1) | Non-IFRS financial measure. |
(2) | Supplementary financial measure. |
Purchased crude net margin
Purchase crude net margin is a non-IFRS financial measure that is calculated using the purchased crude oil and products sales, less the cost of those volumes purchased from third parties including its transportation and refining costs. Purchase crude net margin per boe is a non-IFRS ratio that is calculated using the Purchase crude net margin, divided by the total sales volumes, net of purchases. A reconciliation of this calculation is provided below:
Three months ended June 30 | Six months ended June 30 | |||
2024 | 2023 | 2024 | 2023 | |
Purchased crude oil and products sales ($M) | 49,035 | 59,897 | 100,320 | 111,213 |
(-) Cost of purchases ($M) (1) | (55,153) | (66,602) | (113,012) | (125,889) |
Purchased crude net margin ($M) | (6,118) | (6,705) | (12,692) | (14,676) |
Sales volumes, net of purchases - (boe) | 2,868,593 | 3,257,709 | 5,615,246 | 5,996,168 |
Purchased crude net margin ($/boe) | (2.13) | (2.05) | (2.26) | (2.45) |
(1) | Cost of third-party volumes purchased for use and resale in the Company's oil operations, including its transportation and refining costs. |
Production costs (excluding energy cost), net of realized FX hedge impact, and production cost (excluding energy cost), net of realized FX hedge impact per boe
Production costs (excluding energy cost), net of realized FX hedge impact is a non-IFRS financial measure that mainly includes lifting costs, activities developed in the blocks, processes to put the crude oil and gas in sales condition and the realized gain or loss on foreign exchange risk management contracts attributable to production costs. Production cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using production cost (excluding energy cost), net of realized FX hedge impact divided by production (before royalties). A reconciliation of this calculation is provided below:
Three months | ||
2024 | 2023 | |
Production costs (excluding energy cost) ($M) | 41,401 | 37,171 |
(-) Realized gain on FX hedge attributable to production costs (excluding energy cost) ($M) (1) | (2,203) | (4,840) |
Production costs (excluding energy cost), net of realized FX hedge impact ($M) (2) | 39,198 | 32,331 |
Production (boe) | 3,631,992 | 3,826,459 |
Production costs (excluding energy cost), net of realized FX hedge impact ($/boe) | 10.79 | 8.45 |
(1) | See "(Loss) Gain on Risk Management Contracts" on page 14. |
(2) | Non-IFRS financial measure. |
Energy costs, net of realized FX hedge impact, and production cost, net of realized FX hedge impact per boe
Energy costs, net of realized FX hedge impact is a non-IFRS financial measure that describes the electricity consumption and the costs of localized energy generation and the realized gain or loss on foreign exchange risk management contracts attributable to energy costs. Energy cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using energy cost, net of realized FX hedge impact divided by production (before royalties). A reconciliation of this calculation is provided below:
Three months | ||
2024 | 2023 | |
Energy costs ($M) | 17,997 | 16,444 |
(-) Realized gain on FX hedge attributable to energy costs ($M) (1) | (770) | (1,369) |
Energy costs, net of realized FX hedge impact ($M) (2) | 17,227 | 15,075 |
Production (boe) | 3,631,992 | 3,826,459 |
Energy costs, net of realized FX hedge impact ($/boe) | 4.74 | 3.94 |
(1) | See "(Loss) Gain on Risk Management Contracts" on page 14. |
(2) | Non-IFRS financial measure. |
Transportation costs, net of realized FX hedge impact, and transportation costs, net of realized FX hedge impact per boe
Transportation costs, net of realized FX hedge impact is a non-IFRS financial measure, that includes all commercial and logistics costs associated with the sale of produced crude oil and gas such as trucking and pipeline, and the realized gain or loss on foreign exchange risk management contracts attributable to transportation costs. Transportation cost, net of realized FX hedge impact per boe is a non-IFRS ratio that is calculated using transportation cost, net of realized FX hedge impact divided by net production after royalties. A reconciliation of this calculation is provided below:
Three months | ||
2024 | 2023 | |
Transportation costs ($M) | 34,917 | 39,130 |
(-) Realized gain on FX hedge attributable to transportation costs ($M) (1) | (634) | (1,767) |
Transportation costs, net of realized FX hedge impact ($M) (2) | 34,283 | 37,363 |
Net Production (boe) | 3,139,955 | 3,431,246 |
Transportation costs, net of realized FX hedge impact ($/boe) | 10.92 | 10.89 |
(1) See "(Loss) Gain on Risk Management Contracts" on page 14. |
(2) Non-IFRS financial measure. |
Supplementary Financial Measures
Realized (loss) gain on oil risk management contracts per boe
Realized (loss) gain on oil risk management contracts includes the gain or loss during the period, as a result of the Company´s exposure in derivative contracts of crude oil. Realized (loss) gain on oil risk management contracts per boe is a supplementary financial measure that is calculated using Realized (loss) gain on risk management contracts divided by total sales volumes, net of purchases.
Royalties per boe
Royalties includes royalties and amounts paid to previous owners of certain blocks in Colombia and cash payments for PAP. Royalties per boe is a supplementary financial measure that is calculated using the royalties divided by total sales volumes, net of purchases.
NCIB weighted-average price per share
Weighted-average price per share under the 2023 NCIB is a supplementary financial measure that corresponds to the weighted-average price of common shares purchased under the 2023 NCIB during the period. It is calculated using the total amount of common shares repurchased in U.S. dollars divided by the number of common shares repurchased.
Capital Management Measures
Restricted cash short- and long-term
Restricted cash (short- and long-term) is a capital management measure, that sums the short-term portion and long-term portion of the cash that the Company has in term deposits that have been escrowed to cover future commitments and future abandonment obligations, or insurance collateral for certain contingencies and other matters that are not available for immediate disbursement.
Total cash
Total cash is a capital management measure to describe the total cash and cash equivalents restricted and unrestricted available, is comprised by the cash and cash equivalents and the restricted cash short and long-term.
Total debt and lease liabilities
Total debt and lease liabilities are capital management measures to describe the total financial liabilities of the Company and is comprised of the debt of the 2028 Unsecured Notes, loans, and liabilities from leases of various properties, power generation supply, vehicles and other assets.
Definitions:
bbl(s) | Barrel(s) of oil |
bbl/d | Barrel of oil per day |
boe | Refer to "Boe Conversion" disclosure above |
boe/d | Barrel of oil equivalent per day |
Mcf | Thousand cubic feet |
Net Production | Net production represents the Company's working interest volumes, net of royalties and internal consumption |
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SOURCE Frontera Energy Corporation
Copyright 2024 Canada NewsWire
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