Wrangler West Reports 2012 First Quarter Operating and Financial Results

    




 CALGARY, May 23, 2012 /CNW/ - Wrangler West Energy Corp. ("Wrangler West" or the "Company")  announces today's filing on SEDAR (www.sedar.com) of the Company's unaudited Financial Statements and related  Management's Discussion and Analysis ("MD&A") for the three months  ended March 31, 2012 with comparative data for the three months ended  March 31, 2011 and the year ended December 31, 2011.( )All referenced documents may be viewed at www.sedar.com. 

  





                    

                        Three months ended March 31

                                 2012                2011            % Change

    OPERATIONAL                                                              
    HIGHLIGHTS

    Production                                                               

    Crude oil and                                     247                   
    NGL (bbls/d)                  139                                    (44)

    Natural gas                 4,077               4,704                   
    (mcf/d)                                                              (13)

    Total                                           1,031                   
    production                    818                                    (21)
    (boe/d)

    Prices                                                                   

    Crude oil and               86.58               78.39                    
    NGL ($/bbl)                                                            10

    Natural gas                                      3.92                   
    ($/mcf)                      2.26                                    (42)

    Per boe ($)                                                              

    Petroleum and               25.95               36.66                   
    natural gas                                                          (29)
    revenue

    Royalties                                      (5.39)                   
                               (4.11)                                    (24)

    Operating                 (13.98)             (15.38)                   
    expenses                                                              (9)

    Netback                                         15.89                   
                                 7.86                                    (51)

    General and                (3.72)              (3.31)                    
    administrative                                                         12

    Interest                                       (0.63)                   
                               (0.44)                                    (30)

    Funds flow                                      11.95                   
    from                         3.70                                    (69)
    operations

    Share-based                                                              
    payments                   (0.34)                   -                   -

    Depletion and             (16.28)             (16.09)                    
    depreciation                                                            1

    Gain on sale                                     0.02               (100)
    of assets                       -

    Accretion                                      (0.20)                    
                               (0.20)                                       -

    Deferred                                         1.08                 193
    income tax                   3.16
    benefit

    Net loss                                       (3.24)                 207
                               (9.96)

    FINANCIAL                                                                
    HIGHLIGHTS ($
    thousand)

    Petroleum and               1,932               3,401                   
    natural gas                                                          (43)
    revenue

    Royalties                                       (500)                   
                                (306)                                    (39)

    Operating                 (1,041)             (1,427)                   
    expenses                                                             (27)

    General and                                     (307)                   
    administrative              (277)                                    (10)

    Interest                                                                
                                 (33)                (59)                (44)

    Funds flow                                      1,108                   
    from                          275                                    (75)
    operations

    Share-based                                                              
    payments                     (25)                   -                   -

    Depletion and             (1,212)             (1,493)                   
    depreciation                                                         (19)

    Gain on sale                                                        (100)
    of assets                       -                   2

    Accretion                                                               
                                 (15)                (18)                (17)

    Deferred                                          101                 133
    income tax                    235
    benefit

    Net loss                                        (300)                 147
                                (742)

    Funds flow                                                               
    from
    operations -

      basic and                                      0.17                   
      diluted                    0.04                                    (76)
      ($/share)

    Net loss -                                     (0.05)                 120
    basic and                  (0.11)
    diluted
    ($/share)

                                                                             

    Total assets               26,942              34,172                   
    ($ thousand)                                                         (21)






  

 Wrangler West converts petroleum and natural gas reserves and volumes to  a common unit of measure on a basis of six thousand cubic feet ("mcf")  of natural gas equals one barrel ("bbl") of oil.  Disclosure using  barrels of oil equivalent ("boe") may be misleading, particularly if  used in isolation. The basis for the boe conversion ratio of 6 mcf  equals one bbl is an energy equivalency conversion method, primarily  applicable at the burner tip.  This conversion rate does not represent  a value equivalency at the wellhead. The Company calculates boe per day  based on total production for the period divided by the number of days  during the period. 

 Wrangler West Energy Corp. ("Wrangler West" or the "Company") presents  operating and financial results for the three months ended March 31,  2012.  Wrangler West is a Canadian junior oil and natural gas  exploration company focused on generating shareholder value by  exploring for, developing and producing natural gas and crude oil from  properties located in the Province of Alberta. 

 2012 First Quarter Highlights 




        --  $1.9 million of revenue

        --  $0.3 million of funds flow from operations

        --  $0.5 million in capital expenditures





 2012 First Quarter Review 

 For the 2012 first quarter, Wrangler West produced 818 barrels of oil  equivalent ("boe") per day, a 21 percent decrease compared to the same  period one year ago.  The lower production reflects the Company's  previously announced asset disposition and natural production declines  from the corporate reserves base.  Wrangler West's production profile  remains 80 percent natural gas. 

 In the 2012 first quarter, Wrangler West experienced a ten-year low in  the AECO spot price for natural gas.  Continued deterioration of  natural gas prices forced the Company's decision to minimize capital  expenditures and reduce expenses wherever possible.  Capital  expenditures during 2012 first quarter were focused on 3D seismic and  land acquisitions.  Wrangler West's focus is to remain cash flow  positive and maintain a conservative approach to capital spending.  We  expect this austerity program to remain entrenched as we develop our  inventory of drillable oil prospects. 

 Early 2012 Industry Conditions 

 Subsequent to 2012 first quarter, natural gas prices have recovered  modestly from their ten-year bottom in April 2012.  However, the  current economics for natural gas exploration do not justify a drilling  budget.  Some producers have shut in marginal production in response to  shockingly low natural gas prices. Weather analysts have commented the  2012 summer could be hot and dry.  If they are correct, the upcoming  summer cooling season could be a welcome draw on natural gas storage  levels which are currently double their historical five-year average. 

 Early 2012 Outlook 

 Wrangler West recently received regulatory approval to expand the  waterflood project at Riviere.  This initiative was accomplished after  the Company acquired 100 percent working interest in the Wabamun A  crude oil pool.  Our plan is to inject into an existing horizontal well  and we expect to commence the required workover of the well after  spring break-up. The project is designed to achieve pressure support  through injection of produced water.  This represents a long-term  solution intended to enhance recovery from this oil pool. 

 Volatility throughout world financial markets continues to undermine  investor confidence.  Global events, like the worldwide debt crisis,  integrate quickly and deeply into all financial markets and make it  difficult to forecast and manage day-to-day business activities. 

 As the natural gas oversupply situation unfolds throughout 2012 summer,  Wrangler West is committed to maintaining a defensive position.  Operational efficiencies can occur during the summer season due to  lower expenses in the absence of adverse weather conditions.  Looking  toward the 2012 summer drilling season, oilfield activity levels and  equipment availability appear quite favourable for achieving  competitive pricing which could lead to expansion of Wrangler West's  exploration budget. 

 During 2012, Wrangler West expects to continue to focus on organic  growth using the drill bit.  We have prepared and organized three  oil-prone opportunities on 15 sections of land.  Drilling of each  prospect will be conditional on well-by-well success.  We will be  watching closely for improvement in natural gas prices as we  conservatively manage both cash flow and the Company's available credit  facility. 

  





                             

    WRANGLER WEST ENERGY CORP.                                             

    STATEMENTS OF FINANCIAL                                                
    POSITION

    (Stated in thousands of                                                
    dollars) (unaudited)

                                    March 31, 2012        December 31, 2011

    Assets                                                                 

    Current assets                                                         

      Accounts receivable     $                        $                   
                                               471                      756

      Prepaid expenses                                                     
                                               160                      212

                                                                           
                                               631                      968

                                                                           

    Property, plant and                                                    
    equipment                               26,311                   26,995

                            $               26,942   $               27,963

                                                                           

    Liabilities and                                                        
    shareholders' equity

    Current liabilities                                                    

      Bank indebtedness          $                        $                
                                             4,074                    3,156

      Accounts payable and                                                 
      accrued liabilities                      983                    1,999

                                                                           
                                             5,057                    5,155

                                                                           

    Decommissioning                                                        
    obligations                              2,376                    2,369

                                                                           

    Deferred income tax                                                    
                                             2,569                    2,804

                                                                           
                                            10,002                   10,328

                                                                           

    Shareholders' equity                                                   

      Common shares                                                        
                                            12,402                   12,402

      Contributed surplus                                                  
                                             4,787                    4,740

      Retained earnings                                                    
      (deficit)                              (249)                      493

                                                                           
                                            16,940                   17,635

                                                                           

                            $               26,942   $               27,963

                                                    

                                                    






  





    WRANGLER WEST ENERGY CORP.                                             

    STATEMENTS OF OPERATIONS AND COMPREHENSIVE                             
    LOSS

    (Stated in thousands of dollars, except                                
    per share amounts) (unaudited)

                                                Three months ended March 31

                                          2012                         2011

    Revenue                                                                

      Petroleum and    $                 1,932     $                  3,401
      natural gas
      sales

      Royalties                                                           
                                         (306)                        (500)

                                         1,626                        2,901

                                                                           

    Expenses                                                               

      Operating                          1,041                        1,427

      General and                                                          
      administrative                       277                          307

      Share-based                                                          
      payments                              25                            -

      Depletion and                      1,212                        1,493
      depreciation

      Gain on sale                                                         
      of assets                              -                          (2)

    Results from                                                          
    operating                            (929)                        (324)
    activities

                                                                           

    Finance                                                                

      Interest and                                                         
      accretion                             48                           77

                                                                           

    Loss before                                                           
    income tax                           (977)                        (401)

                                                                           

    Deferred income                                                       
    tax benefit                          (235)                        (101)

                                                                           

    Net loss and     $                   (742)   $                    (300)
    comprehensive
    loss

                                                                           

    Net loss per                                                           
    share

      Basic and      $                  (0.11)   $                   (0.05)
      diluted

                                                  

                                                  






  





    STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY                                            

    (Stated in thousands of dollars and shares) (unaudited)

                                                                                            

                       Number of                                    Retained           Total
                          common         Common    Contributed      earnings   shareholders'
                          shares         shares        surplus     (deficit)          equity

    Balance at             6,466    $    12,402    $     4,740   $       493  $       17,635
    January 1,
    2012

      Share-based                                                                           
      payments                 -              -             47             -              47

      Net loss                                                                             
                               -              -              -         (742)           (742)

    Balance at             6,466    $    12,402    $     4,787  $      (249)   $      16,940
    March 31,
    2012

                                                                                            

                                                                                            

    Balance at             6,466    $    12,402    $     4,538   $     2,297   $      19,237
    January 1,
    2011

      Net loss                                                                             
                               -              -              -         (300)           (300)

    Balance at             6,466    $    12,402    $     4,538    $    1,997   $      18,937
    March 31,
    2011

                                                                

                                                                






  





    WRANGLER WEST ENERGYCORP.                                                

    STATEMENTS OF CASH                                                       
    FLOWS

    (Stated in                                                               
    thousands of
    dollars)
    (unaudited)

                                                                             

                                                  Three months ended March 31

                                             2012                        2011

    Cash provided by                                                         
    (used in):

                                                                             

    Operating                                                                

        Net loss        $                   (742)    $                  (300)

        Items not                                                            
        involving
        cash:

          Depletion                         1,212                       1,493
          and
          depreciation

          Accretion                                                          
                                               15                          18

          Share-based                                                        
          payments                             25                           -

          Gain on sale                                                       
          of assets                             -                         (2)

          Deferred                                                          
          income tax                        (235)                       (101)
          benefit

                                              275                       1,108

        Change in                             227                            
        non-cash                                                          179
        operating
        working
        capital

                                              502                       1,287

                                                                             

    Financing                                                                

        Increase in                           918                            
        bank                                                              763
        indebtedness

                                                                             

    Investing                                                                

        Property,                                                           
        plant and                           (514)                       (864)
        equipment
        expenditures

        Proceeds on                                                          
        sale of assets                          -                          26

        Change in                                                           
        non-cash                            (906)                     (1,212)
        investing
        working
        capital

                                          (1,420)                           
                                                                      (2,050)

                                                                             

    Cash and cash      $                        -    $                       
    equivalents,                                                            -
    beginning and end
    of period

                                                                             

    Supplementary cash                                                       
    flow information

        Interest paid                                                       
                                             (42)                        (57)

        Income tax                                                           
        refund                                  -                          74






  

 Additional Information Wrangler West files additional shareholder and public information on  SEDAR accessible at www.sedar.com. This includes the Statement of Reserves Data and Other Oil and Gas  Information Form NI 51-101 F1, F2, F3 and F4 effective December 31,  2011.  Alternatively, to obtain copies of published corporate  information, contact Crista L. Ferguson, Chief Financial Officer,  Wrangler West Energy Corp., 1950, 444 Fifth Avenue SW, Calgary,  Alberta, Canada  T2P 2T8 (telephone [phone] or e-mail [e-mail]). 

 Reader Advisory This news release may contain forward-looking statements ("FLS") related  to potential new crude oil and natural gas drilling, tie-ins,  production operations, sources and use of capital, asset purchases or  dispositions and expected future operations. Although Wrangler West  believes the expectations reflected in these FLS are reasonable, undue  reliance should not be placed on the FLS because the Company can give  no assurance they will prove to be correct. Since FLS address future  events and conditions, by their very nature, they involve inherent  risks and uncertainties. A more detailed discussion of FLS is provided  in Wrangler West's Management's Discussion and Analysis for the year  ended December 31, 2011 which is filed on SEDAR (www.sedar.com).  The FLS contained in this news release are made as of the date  hereof and Wrangler West undertakes no obligation to update publicly or  revise any FLS or information, whether as a result of new information,  future events or otherwise, unless so required by applicable securities  laws. 

 Corporate Profile Wrangler West is a Canadian junior crude oil and natural gas producer  which explores for and develops crude oil and natural gas production  assets in the Province of Alberta. Since inception, the Company's  mandate has been to use the drill bit to add shareholder value.  Disciplined management of operations and the production portfolio  creates sufficient funds flow to support ongoing operations. Wrangler  West intends to continue to reinvest funds flow from operations and  other available capital to protect current, and add future, value.   Wrangler West common shares trade on the TSX Venture Exchange under the  symbol "WX". 

 Neither the TSX Venture Exchange nor its Regulation Services Provider  (as defined in the policies of the TSX Venture Exchange) accepts  responsibility for the adequacy or accuracy of this news release. 

   

   

   

   

Wrangler West Energy Corp.


CONTACT:  Wrangler West Energy Corp.Steven F. JohnsonPresident and Chief Executive [e-mail]:  [phone] 


    

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