NiMin Energy Corp. Announces 2011 Second Quarter Results
Aug 12, 2011
OTC Disclosure News Service
Carpinteria, CA –
NiMin Energy Corp. (TSX:NNN) (OTCBB and OTCQX:NEYYF) (the “Company” or “NiMin”) today announced the financial results prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for the quarter ended June 30, 2011. Copies of these documents may be obtained via the Company’s website at www.niminenergy.com and via SEDAR at www.sedar.com Additionally, we also file reports with the United States Securities and Exchange Commission (“SEC”) available at www.sec.gov. All references to dollar values refer to U.S. dollars unless otherwise stated.
Net income/(loss) for the quarter ended June 30, 2011 was $3.83 million, as compared to ($2.46) million for the quarter ended June 30, 2010. Earnings/(loss) per share for the quarter ended June 30, 2011 was $0.06, as compared to ($0.05) for the quarter ended June 30, 2010. The Company had an unrealized gain on crude oil derivative contracts of $2.03 million during the quarter ended June 30, 2011, as compared to an unrealized gain of $1 million for the same period in 2010. Additionally, the Company had a change in the fair value of its warrants resulting in a non-cash gain of $3.18 million, as compared to a non-cash gain of $242,174 in the same period in 2010.
For the three months ended June 30, 2011, NiMin recorded net revenues of $5.70 million, as compared to $3.24 million for the same period in 2010. This 76% increase in net revenues was due to an increase in production volumes and an increase in commodity prices received by the Company. Operating costs in the second quarter of 2011 increased to $2.91 million from $1.70 million for the same period in 2010. The increase in operating expenses in 2011 is due to higher production volumes and severance taxes, costs associated with the Krotz Springs Field and its maintenance due to the flooding in southern Louisiana, and a number of expected annual maintenance costs concentrated during the quarter at the Company’s properties in California and Wyoming. General administrative (“GA”) expenses in the second quarter decreased to $1.58 million from $2.40 million for the same period in 2010. Deducting stock-based compensation costs, a non-cash accounting entry, the GA expenses in the second quarter of 2011 were $938,760, as compared to the $1.63 million reported in the same period in 2010. Depreciation, depletion, amortization, and accretion in the second quarter of 2011, a non-cash accounting entry, decreased to $778,955 from $888,420 reported for the same period in 2010. This decrease is mainly due to an increase in the Company’s total proved reserves as a result of an increase in the development of the Wyoming Assets.
Highlights for the quarter ended June 30, 2011 include:
- Increased revenues during the second quarter by 76%.
· Drilled 7 wells in Wyoming and 2 wells in California, 3 of which were producing at the end of the quarter. The remaining wells are expected to be online during the third quarter.
· Exited the quarter at approximately 1,200 barrels of oil equivalent per day.
· Completed phase I and II of the facility expansion at Willow Draw Field in Wyoming.
NiMin’s CEO and Chairman, Mr. Clancy Cottman, said, “Our second quarter results demonstrate the continued strength of our business and the successful execution of our strategic plan. The wells we’ve added this quarter are performing at or above our expectations, contributing to our financial results. We’re continuing to drill new wells in Wyoming, which we expect to be on-line by the end of the third quarter and bolster production. Also, we are evaluating new opportunities to drill in California and further develop the Pleito Creek Field, which has significant conventional and enhanced oil recovery development upside.”
The Company will host a conference call at 3:00pm Eastern time (12:00pm Pacific) on Friday, August 12, 2011. During this call the management team will discuss the Company’s results for the three and six months ended June 30, 2011. The conference leader will be Mr. Clancy Cottman, CEO and Chairman of NiMin. Also on the call will be Mr. Jonathan Wimbish, CFO, and Mr. Scott Dobson, Vice President of Operations. Interested parties in the United States can access the conference call by dialing (877) 407-0782; parties outside the U.S. should dial (201) 689-8567 five to ten minutes prior to the start time. The call will also be webcast live on the Company’s web site at www.niminenergy.com. A replay of the call will be available by calling toll free (877) 660-6853 or for international calls (201) 612-7415 using account number 286 and conference ID #377439. The replay will be available until August 27, 2011.
Jonathan Wimbish, CFA
NiMin Energy Corp.
Chief Financial Officer
+1 (805) 566-2900
Dan Gagnier/Jared Levy
Sard Verbinnen Co
+1 (212) 687-8080
About NiMin Energy
NiMin is a California based independent oil and gas exploration and production company with principal operations in the Bighorn Basin of Wyoming, the San JoaquinBasin in California and South Louisiana onshore areas of the U.S.
This news release contains forward-looking statements and information (“forward-looking statements“) within the meaning of applicable securities laws, including the implementation of NiMin’s strategic plan, NiMin’s aggressive drilling and development program during 2011. Although NiMin believes that the expectations reflected in its forward-looking statements are reasonable, such statements have been based upon currently available information to NiMin. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in forward-looking statements. Risks include, but are not limited to: the risks associated with the oil and gas industry (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price, price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in more detail in our Annual Information Form and other documents available at www.sedar.com and www.sec.gov. Readers are cautioned to not place undue reliance on forward-looking statements. The statements in this press release are made as of the date of this release, and, except as required by applicable law, NiMin does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement. NiMin undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the NiMin, Legacy or their respective financial or operating results or, as applicable, their securities. The net present value of future net revenue attributable to NiMin’s reserves do not represent fair market value. Barrels of oil equivalent (“boe”) may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet (“mcf”): one barrel (“bbl”) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
The material differences between reserve quantities disclosed under National Instrument (“NI”) 51-101 and those disclosed under the U.S. SEC guidelines and the United States Financial Accounting Standards Board (the “U.S. Rules”) is that NI 51-101 requires the determination of reserve quantities to be based in forecast pricing assumptions whereas the U.S. Rules require the determination of reserve quantities to be based on constant price assumptions calculated using a 12 month average price for the year (sum of the benchmark price on the first calendar day of each month in the year divided by 12).
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