Bellatrix Exploration Ltd. Announces Third Quarter 2012 Financial Results
TSX, NYSE MKT: BXE
CALGARY, Nov. 8, 2012 /CNW/ - Bellatrix Exploration Ltd. ("Bellatrix" or
the "Company") (TSX, NYSE MKT: BXE) announces its financial and
operating results for the three and nine months ended September 30,
2012.
Forward-Looking Statements
This press release, including the report to shareholders, contains
forward-looking statements. Please refer to our cautionary language on
forward-looking statements and the other matters set forth at the
beginning of the management's discussion and analysis (the "MD&A")
attached to this press release.
HIGHLIGHTS
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Three months ended September 30,
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Nine months ended September 30,
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2012
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2011
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2012
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2011
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FINANCIAL (unaudited)
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(CDN$000s except share and per share amounts)
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Revenue (before royalties and risk management (1))
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48,126
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49,145
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157,031
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143,124
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Funds flow from operations (2) |
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26,613
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23,964
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81,173
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64,117
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Per basic share (6) |
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$0.25
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$0.22
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$0.76
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$0.62
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Per diluted share (6) |
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$0.23
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$0.21
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$0.70
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$0.58
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Cash flow from operating activities
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24,807
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28,023
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77,321
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67,566
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Per basic share (6) |
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$0.23
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$0.26
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$0.72
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$0.66
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Per diluted share (6) |
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$0.22
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$0.24
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$0.67
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$0.61
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Net profit before non-cash impairment loss, unrealized
gain (loss) on commodity contracts, and gain (loss) on
property dispositions (5) |
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5,233
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4,168
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14,448
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9,167
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Per basic share (6) |
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$0.05
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$0.04
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$0.13
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$0.09
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Per diluted share (6) |
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$0.05
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$0.04
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$0.13
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$0.09
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Net profit (loss)
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(615)
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820
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18,520
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7,648
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Per basic share (6) |
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($0.01)
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$0.01
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$0.17
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$0.07
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Per diluted share (6) |
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($0.01)
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$0.01
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$0.17
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$0.07
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Exploration and development
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39,818
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44,093
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132,104
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128,354
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Corporate and property acquisitions
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22
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134
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196
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3,945
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Capital expenditures - cash
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39,840
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44,227
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132,300
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132,299
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Property dispositions - cash
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(4,325)
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(4,140)
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(6,670)
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(4,181)
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Non-cash items
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(1,756)
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3,457
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(1,612)
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4,410
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Total capital expenditures - net
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33,759
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43,544
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124,018
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132,528
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Long-term debt
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104,642
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37,379
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104,642
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37,379
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Convertible debentures (3) |
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50,269
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48,692
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50,269
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48,692
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Adjusted working capital deficiency (3) |
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11,308
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15,265
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11,308
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15,265
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Total net debt (3) |
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166,219
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101,336
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166,219
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101,336
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Total assets
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627,835
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546,309
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627,835
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546,309
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Total shareholders' equity
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370,235
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360,846
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370,235
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360,846
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OPERATING
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Three months ended September 30,
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Nine months ended September 30,
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2012
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2011
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2012
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2011
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Average daily sales volumes
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Crude oil, condensate and NGLs
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(bbls/d)
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5,204
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4,413
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5,713
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4,242
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Natural gas
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(mcf/d)
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61,796
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44,546
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61,654
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41,710
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Total oil equivalent
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(boe/d)
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15,503
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11,837
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15,989
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11,194
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Average prices
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Light crude oil and condensate
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($/bbl)
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84.98
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88.91
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87.74
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91.42
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NGLs
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($/bbl)
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28.62
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51.74
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38.90
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53.10
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Heavy oil
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($/bbl)
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63.95
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64.19
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69.17
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66.13
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Crude oil, condensate and NGLs
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($/bbl)
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70.37
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80.78
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74.96
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83.37
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Crude oil, condensate and NGLs (including risk management (1))
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($/bbl)
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70.72
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82.38
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72.83
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80.85
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Natural gas
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($/mcf)
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2.45
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3.91
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2.26
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3.97
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Natural gas (including risk management (1))
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($/mcf)
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3.38
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4.33
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2.96
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4.23
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Total oil equivalent
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($/boe)
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33.38
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44.82
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35.51
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46.39
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Total oil equivalent (including risk management (1))
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($/boe)
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37.22
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47.02
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37.44
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46.41
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Statistics
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Operating netback (4) |
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($/boe)
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18.29
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23.89
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19.85
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24.71
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Operating netback (4) (including risk management (1))
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($/boe)
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22.13
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26.09
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21.78
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24.72
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Transportation
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($/boe)
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0.90
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1.34
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0.86
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1.35
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Production expenses
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($/boe)
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7.96
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11.71
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8.66
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11.85
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General & administrative
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($/boe)
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2.38
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3.14
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2.26
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2.81
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Royalties as a % of sales after transportation
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19%
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18%
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18%
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19%
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COMMON SHARES
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Common shares outstanding
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107,606,884
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107,391,298
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107,606,884
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107,391,298
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Share options outstanding
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9,499,007
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7,830,931
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9,499,007
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7,830,931
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Shares issuable on conversion of convertible debentures (7) |
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9,821,429
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9,821,429
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9,821,429
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9,821,429
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Diluted common shares outstanding
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126,927,320
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125,043,658
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126,927,320
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125,043,658
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Diluted weighted average shares - net profit (6) |
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107,527,718
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109,392,760
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109,111,492
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105,115,006
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Diluted weighted average shares - funds flow from operations
and cash flow from operating activities (2) (6) |
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117,927,891
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119,214,189
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118,932,921
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114,936,435
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SHARE TRADING STATISTICS
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TSX
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(CDN$, except volumes) based on intra-day trading
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High
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4.26
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5.48
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5.67
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6.19
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Low
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2.95
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3.35
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2.45
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3.35
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Close
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3.99
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3.37
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3.99
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3.37
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Average daily volume
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321,383
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416,772
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499,495
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559,103
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NYSE MKT(8) |
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(US$, except volumes) based on intra-day trading
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High
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4.36
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-
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4.36
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-
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Low
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3.75
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-
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3.75
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-
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Close
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4.07
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-
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4.07
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-
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Average daily volume
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23,601
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-
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23,601
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-
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(1) The Company has entered into various commodity price risk management
contracts which are considered to be economic hedges. Per unit metrics
after risk management include only the realized portion of gains or
losses on commodity contracts.
The Company does not apply hedge accounting to these contracts. As
such, these contracts are revalued to fair value at the end of each
reporting date. This results in recognition of unrealized gains or
losses over the term of these contracts which is reflected each
reporting period until these contracts are settled, at which time
realized gains or losses are recorded. These unrealized gains or
losses on commodity contracts are not included for purposes of per unit
metrics calculations disclosed.
(2) The highlights section contains the term "funds flow from operations"
which should not be considered an alternative to, or more meaningful
than cash flow from operating activities as determined in accordance
with generally accepted accounting principles ("GAAP") as an indicator
of the Company's performance. Therefore reference to the non-GAAP terms
of funds flow from operations, or funds flow from operations per share
may not be comparable with the calculation of similar measures for
other entities. Management uses funds flow from operations to analyze
operating performance and leverage and considers funds flow from
operations to be a key measure as it demonstrates the Company's ability
to generate the cash necessary to fund future capital investments and
to repay debt. The reconciliation between cash flow from operating
activities and funds flow from operations can be found in the MD&A.
Funds flow from operations per share is calculated using the weighted
average number of common shares for the period.
(3) Net debt and total net debt are considered non-GAAP terms. The
Company's calculation of total net debt includes the liability
component of convertible debentures and excludes deferred liabilities,
long-term commodity contract liabilities, decommissioning liabilities,
long-term finance lease obligations and the deferred tax liability.
Net debt and total net debt include the net working capital deficiency
(excess) before short-term commodity contract assets and liabilities
and current finance lease obligations. Net debt also excludes the
liability component of convertible debentures. A reconciliation between
total liabilities under GAAP and total net debt and net debt as
calculated by the Company is found in the MD&A.
(4) Operating netbacks is considered a non-GAAP term. Operating netbacks
are calculated by subtracting royalties, transportation, and operating
costs from revenues before other income.
(5) Net profit before non-cash impairment loss, unrealized gain (loss) on
commodity contracts, and gain (loss) on property dispositions is
considered a non-GAAP term. Net profit before non-cash impairment loss,
unrealized gain (loss) on commodity contracts, and gain (loss) on
property dispositions is calculated as net profit (loss) per the
Consolidated Statement of Comprehensive Income, excluding the non-cash
impairment loss, unrealized gain or loss on commodity contracts, and
gain or loss on property dispositions, net of the deferred tax impact
on these adjustments. The Company's reconciliation between net profit
(loss) and net profit before non-cash impairment loss, unrealized gain
(loss) on commodity contracts, and gain (loss) on property dispositions
is found in the MD&A.
(6) Basic weighted average shares for the three and nine months ended
September 30, 2012 were 107,527,718 (2011: 107,391,070) and 107,479,907
(2011: 102,664,721), respectively.
In computing weighted average diluted earnings per share for the three
months ended September 30, 2012, a total of nil (2011: 2,001,690)
common shares were added to the denominator as a consequence of
applying the treasury stock method to the Company's outstanding share
options and a total of 9,821,429 (2011: 9,821,429) common shares
issuable on conversion of convertible debentures were excluded from the
denominator as they were not dilutive, resulting in diluted weighted
average common shares of 107,527,718 (2011: 109,392,760).
In computing weighted average diluted earnings per share for the nine
months ended September 30, 2012, a total of 1,631,585 (2011: 2,450,285)
common shares were added to the denominator as a consequence of
applying the treasury stock method to the Company's outstanding share
options, and a total of 9,821,429 (2011: 9,281,429) common shares
issuable on conversion of convertible debentures were excluded from the
denominator as they were not dilutive, resulting in diluted weighted
average common shares of 109,111,492 (2011: 105,115,006).
In computing weighted average diluted net profit before non-cash
impairment loss, unrealized gain (loss) on commodity contracts, and
gain (loss) on property dispositions per share for the three and nine
months ended September 30, 2012, a total of 578,744 (2011: 2,001,690)
and 1,631,585 (2011: 2,450,285) common shares, respectively, were added
to the denominator as a consequence of applying the treasury stock
method to the Company's outstanding share options as they were
dilutive, and a total of 9,821,429 (2011: 9,821,429) common shares
issuable on conversion of convertible debentures were excluded from the
denominator as they were not dilutive, resulting in diluted weighted
average shares of 108,106,462 (2011: 109,392,760) and 109,111,492
(2011: 105,115,006).
In computing weighted average diluted cash flow from operating
activities and funds flow from operations for the three and nine months
ended September 30, 2012, a total of 578,744 (2011: 2,001,690) and
1,631,585 (2011: 2,450,285) common shares were added to the denominator
as a consequence of applying the treasury stock method to the Company's
outstanding share options and a total of 9,821,429 (2011: 9,821,429)
common shares issuable on conversion of convertible debentures were
also added to the denominator as they were dilutive, resulting in
diluted weighted average common shares of 117,927,891 (2011:
119,214,189) and 118,932,921 (2011: 114,936,435), respectively. As a
consequence, a total of $0.8 million (2011: $0.7 million) and $2.3
million (2011: $2.2 million) for interest accretion expense (net of
income tax effect) were added to the numerator for the respective
periods.
(7) Shares issuable on conversion of convertible debentures are calculated
by dividing the $55.0 million principal amount of the convertible
debentures by the conversion price of $5.60 per share.
(8) The Company's common shares commenced trading on the NYSE MKT on
September 24, 2012.
REPORT TO SHAREHOLDERS
Bellatrix posted revenues of $48.1 million with funds flow from
operations of $26.6 million ($0.25 per basic share) in the third
quarter of 2012. Compelling reductions in lease operating costs and G&A
to historically low levels facilitated net profit of $5.2 million
($0.05 per basic share) in the quarter before non-cash impairment loss,
unrealized gain (loss) on commodity contracts and gain (loss) on
property dispositions, net of associated deferred tax impacts.
The third quarter of 2012 was also defined by two elements outside of
our control, commodity prices and the weather. Commodity, namely
natural gas, pricing had a significantly negative impact on revenues
and cash flow which the Company was able to partially counterbalance
with a combination of commodity hedges, increased production rates and
with abatements in lease operating costs and corporate G&A. As it
concerns the weather, the Company was forced to acquiesce to the
unpredictable, protracted, radical weather conditions throughout West
Central Alberta, which resulted in meaningful production restrictions
occurring simultaneously with considerable delays in the third quarter
drilling program. However, as a direct result of industry leading
production performance from the wells drilled this year, Bellatrix
still expects to meet its 2012 average annual and exit production
guidance despite the aforementioned challenges.
Third quarter 2012 sales volumes averaged 15,503 boe/d (weighted 34% to oil, condensate and NGLs and 66% to natural gas).
Production for the month of October, based on field estimates, equates
to 18,300 boe/d (weighted 34% to oil, condensate and NGLs and 66% to natural gas).
Field production estimates for the end of October are 19,000 boe/d carrying the same weighting as the month's average.
On September 20, 2012, Bellatrix received approval for listing of its
common shares on the NYSE MKT, and its common shares commenced trading
on September 24, 2012 under the symbol "BXE". Bellatrix is pleased to
obtain a listing on the NYSE MKT and believes that it will result in
improved liquidity for all of Bellatrix's shareholders and greater
future access to U.S. capital markets.
Operational highlights for the three and nine months ended September 30,
2012 include:
-
During the first nine months of 2012, Bellatrix posted a 100% success
rate drilling and/or participating in 24 gross (20.15 net) wells
resulting in 18 gross (15.15 net) Cardium oil wells, 2.0 gross (2.0
net) Cardium condensate rich gas wells, 1.0 gross (1.0 net) Duvernay
gas well and 3.0 gross (2.0 net) Notikewin/Falher liquids rich gas
wells. Bellatrix drilled 9 gross (7.71 net) wells consisting of 7 gross
(6.21 net) Cardium oil wells and 2 gross (1.5 net) liquids rich
Notikewin/Falher gas wells in the third quarter of 2012.
-
In the Brazeau area of West Central Alberta, the Company recently
completed a long reach Cardium horizontal oil well (50% WI) to a total
depth of 5,014 m with a 2,767 m horizontal leg. Average production
volumes over the initial 30 days of production, based on field
estimates, equated to 1,062 boe/d, 70% oil and liquids with 30% gas.
-
The average sales volumes for Q3 2012 were negatively affected by
protracted spring breakup conditions, scheduled plant turnarounds, a
series of intense localized storms resulting in an unusually high
number of occurrences of unscheduled downtime and prolonged wet
conditions delaying the third quarter drilling, completion and tie-in
program. Power outages caused by power poles being struck by lightning,
hail and intense rain shorted out transformers. In addition a violent
rainstorm shorted out electrical panels that created significant
downtime for a major midstream operator that processes a portion of our
production. However, Bellatrix continues to expect it will meet its
previously announced 2012 calendar year guidance of average daily
production of 16,500 to 17,000 boe/d and an exit rate of 19,000 boe/d
to 19,500 boe/d.
-
Q3 2012 sales volumes averaged 15,503 boe/d (weighted 34% to oil, condensate and NGLs and 66% to
natural gas). This represents a 31% increase from the third quarter 2011 average
sales volumes of 11,837 boe/d and a 6% decrease from second quarter
2012 average sales volumes of 16,569 boe/d.
-
Production expenses plummeted to a new low of $7.96 per boe in the third quarter as a direct result of the Company staff's
dedication to the long-term corporate strategic goal of being a low
cost operator.
To see the Operating Costs per BOE graph, please click, http://files.newswire.ca/958/BellatrixGraph.pdf
-
In the third quarter of 2012 the Company spent $39.8 million on capital projects which included the aforementioned drilling program coupled with
commissioning a 30 mmcf/d compression facility in the Ferrier area,
installation of 7.2 miles of a 10 inch high pressure gas line with a 4
inch condensate line and a 2 inch fuel gas line, a total of 14.3 miles
of 10 and 8 inch gathering system trunk lines and 4.5 miles of 6 inch
gathering system lines to tie in the wells drilled in the quarter.
-
An initial capital budget of $180 million has been set for fiscal 2013.
Based on the timing of proposed expenditures, downtime for anticipated
plant turnarounds, resolution of infrastructure constraints and normal
production declines, execution of the 2013 budget is anticipated to
provide 2013 average daily production of approximately 20,000 boe/d to 21,000
boe/d and an exit rate of approximately 21,500 boe/d to 22,500 boe/d.
-
During Q3 2012, Bellatrix closed on the disposition of a minor non-core
property interest in the Wainwright area, Alberta for $4.25 million
after adjustments. This non-operated unit heavy oil property had
production of approximately 59 boe/d. The net proceeds were initially
used to reduce the Company's bank indebtedness and ultimately will be
directed towards the development of its Cardium oil resource program.
-
As at September 30, 2012, Bellatrix had approximately 197,428 net undeveloped acres of land in Alberta, British Columbia and Saskatchewan.
Financial highlights for the three and nine months ended September 30,
2012 include:
-
Q3 2012 revenue was $48.1 million, 2% lower than the $49.1 million recorded in Q3 2011. The decrease in
revenues between quarters was due to reduced liquids and natural gas
prices experienced in Q3 2012, largely offset by the impact of
increased sales volumes between periods. Revenue for the first nine
months of 2012 was $157.0 million, up 10% from $143.1 million in the
same period in 2011.
-
Funds flow from operations for Q3 2012 was $26.6 million ($0.25 per basic share), up 11% from $24.0 million ($0.22 per basic
share) in Q3 2011, in spite of the lower commodity prices experienced
in Q3 2012. Funds flow from operations for the first nine months of
2012 was $81.2 million ($0.76 per basic share), up 27% from $64.1
million ($0.62 per basic share) in the same period in 2011.
-
For the three and nine months ended September 30, 2012, net profit
before non-cash impairment loss, unrealized gain (loss) on commodity
contracts and gain (loss) on property dispositions, net of associated
deferred tax impacts, was $5.2 million and $14.4 million, compared to $4.2 million and $9.2 million in 2011 periods,
respectively.
-
The net profit for the first nine months of 2012 was $18.5 million,
inclusive of non-cash impairment loss, unrealized gain (loss) on
commodity contracts and gain (loss) on property dispositions, net of
associated deferred tax impacts, compared to a net profit of $7.6
million in the same period in 2011.
-
The Company posted a net loss for Q3 2012 of $0.6 million inclusive of
non-cash impairment loss, unrealized gain (loss) on commodity contracts
and gain (loss) on property dispositions, net of associated deferred
tax impacts, compared to a net profit of $0.8 million for Q3 2011.
-
Crude oil, condensate and NGLs produced 71% and 75% of revenue for the three and nine month periods ended September
30, 2012, respectively.
-
Production expenses for Q3 2012 fell to $7.96/boe ($11.4 million), compared to $11.71/boe ($12.7 million) for Q3 2011 and
$8.80/boe ($13.3 million) for Q2 2012. The decrease was due to
increased production which is a result of 2011 and 2012 drilling in
areas with lower production expenses, as well as reduced processing
fees in certain areas and continued field optimization projects.
-
Operating netbacks after including risk management for Q3 2012 were $22.13/boe, down from $26.09/boe in Q3 2011. Operating netbacks before risk
management for Q3 2012 were $18.29/boe, down from $23.89/boe in Q3 2011
and up from $16.42/boe in Q2 2012. The decreased netback for Q3 2012
compared to Q3 2011 was primarily the result of reduced commodity
prices, despite a reduction in transportation, royalties and production
expenses. The Q3 2012 netback reflects slightly increased overall
commodity prices and reduced expenses compared to Q2 2012.
-
Bellatrix spent $39.8 million on capital projects during Q3 2012 compared to $44.2 million in Q3 2011. For the first
nine months of 2012 as well as 2011, Bellatrix spent $132.3 million on
capital projects.
-
After dispositions Bellatrix spent $35.5 million on capital projects
during Q3 2012 and $125.6 million for the first nine months of 2012.
-
G&A expenses for Q3 2012 decreased to $2.38/boe ($3.4 million), compared to $3.14/boe ($3.4 million) for Q3 2011. G&A
expenses for the nine months ended September 30, 2012 were $2.26/boe
($9.9 million), compared to $2.81/boe ($8.6 million) in the same period
of 2011.
-
Total net debt as of September 30, 2012 was $166.2 million, including the liability component of convertible debentures.
-
As at September 30, 2012, Bellatrix had $104.6 million drawn on its
total $200 million credit facility.
OUTLOOK
During the fourth quarter of 2012 the Company expects to drill an
estimated 6 gross (4.85 net) Cardium oil wells which includes a second
long reach Cardium horizontal well (programmed to drill to a total
depth of 5,511 m including a horizontal length of 3,048 m) in the
Brazeau area. With reductions in industry activity levels Bellatrix,
through negotiation, has been able to reduce our average cost base per well by 10% and expects to carry these savings through the winter of 2012/13. The
Company is also moving to pad drilling wherever plausible in our continuing effort to bring down the capital cost per well
improving our already industry leading F & D costs and recycle ratios.
In an effort to mitigate the effects of the recent extended spring
breakup conditions which has had a significant impact on Q3 production
during the past couple of years, the Company is maturing drilling pads
that will provide access during this unpredictable inclement period for
drilling, completing and tie in of new wells.
Bellatrix continues to focus on growth by development of its core
Cardium and Notikewin/Falher assets utilizing its large inventory of
geological prospects. The Company has developed an inventory of 644 net remaining Cardium locations and 354 net Notikewin/Falher locations representing a net remaining investment of $3.95 billion based on current drilling costs. As at September 30, 2012, Bellatrix
has approximately 197,428 net undeveloped acres and including all opportunities has in excess of 1,525 net exploitation
drilling opportunities identified, with capital requirements of $6.98
billion, based on current drilling costs, representing over 40 years of drilling inventory based on current annual cash flow. The Company continues to focus on
adding Cardium and Notikewin prospective lands.
As always we are dedicated to providing our shareholders with sustainable growth in value.
Raymond G. Smith, P. Eng.
President and CEO
November 7, 2012
MANAGEMENT'S DISCUSSION AND ANALYSIS
November 7, 2012 - The following Management's Discussion and Analysis of
financial results ("MD&A") as provided by the management of Bellatrix
Exploration Ltd. ("Bellatrix" or the "Company") should be read in
conjunction with the unaudited interim consolidated financial
statements of the Company for the three and nine months ended September
30, 2012, and the audited consolidated financial statements of the
Company for the years ended December 31, 2011 and 2010 and the related
Management's Discussion and Analysis of financial results as disclosure
which is unchanged from such Management's Discussion and Analysis may
not be repeated herein. This commentary is based on information
available to, and is dated as of, November 7, 2012. The financial data
presented is in Canadian dollars, except where indicated otherwise.
CONVERSION: The term barrels of oil equivalent ("boe") may be
misleading, particularly if used in isolation. A boe conversion ratio
of six thousand cubic feet of natural gas to one barrel of oil
equivalent (6 mcf/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. Given that the value ratio based on
the current price of crude oil as compared to natural gas is
significantly different from the energy equivalency of 6:1, utilizing a
conversion on a 6:1 basis may be misleading as an indication of value.
All boe conversions in this report are derived from converting gas to
oil in the ratio of six thousand cubic feet of gas to one barrel of
oil.
INITIAL PRODUCTION RATES: Initial production rates disclosed herein may
not necessarily be indicative of long-term performance or ultimate
recovery.
NON-GAAP MEASURES: This Management's Discussion and Analysis and the
accompanying report to shareholders contain the term "funds flow from
operations" which should not be considered an alternative to, or more
meaningful than "cash flow from operating activities" as determined in
accordance with generally accepted accounting principles ("GAAP") as an
indicator of the Company's performance. Therefore reference to funds
flow from operations or funds flow from operations per share may not be
comparable with the calculation of similar measures for other entities.
Management uses funds flow from operations to analyze operating
performance and leverage and considers funds flow from operations to be
a key measure as it demonstrates the Company's ability to generate the
cash necessary to fund future capital investments and to repay debt.
The reconciliation between cash flow from operating activities and
funds flow from operations can be found in this Management's Discussion
and Analysis. Funds flow from operations per share is calculated using
the weighted average number of shares for the period.
This Management's Discussion and Analysis and the accompanying report to
shareholders also contains other terms such as net profit before
non-cash impairment loss, unrealized gain (loss) on commodity
contracts, and gain (loss) on property dispositions, total net debt,
and operating netbacks, which are not recognized measures under GAAP.
Net profit before non-cash impairment loss, unrealized gain (loss) on
commodity contracts, and gain (loss) on property dispositions is
calculated as net profit (loss) per the Consolidated Statement of
Comprehensive Income, excluding the non-cash impairment loss, net
unrealized gain or loss on commodity contracts, and gain or loss on
property dispositions net of the deferred tax impact on these
adjustments. Total net debt is calculated as long-term debt plus the
liability component of the convertible debentures and the net working
capital deficiency (excess) before short-term commodity contract assets
and liabilities and current finance lease obligations. Net debt is
calculated as long-term debt plus the net working capital deficiency
(excess) before short-term commodity contract assets and liabilities
and current finance lease obligations. Operating netbacks are
calculated by subtracting royalties, transportation, and operating
expenses from revenues before other income. Management believes these
measures are useful supplemental measures of firstly, the total amount
of current and long-term debt and secondly, the amount of revenues
received after transportation, royalties and operating expenses.
Readers are cautioned, however, that these measures should not be
construed as an alternative to other terms such as current and
long-term debt or net income determined in accordance with GAAP as
measures of performance. Bellatrix's method of calculating these
measures may differ from other entities, and accordingly, may not be
comparable to measures used by other companies.
Additional information relating to the Company, including the
Bellatrix's Annual Information Form, is available on SEDAR at www.sedar.com.
FORWARD LOOKING STATEMENTS: Certain information contained herein and in
the accompanying report to shareholders may contain forward looking
statements including management's assessment of future plans and
operations, drilling plans and the timing thereof, commodity price risk
management strategies, 2012 capital expenditure budget, the nature of
expenditures and the method of financing thereof, expected 2012 average
production and exit rate, anticipated liquidity of the Company and
various matters that may impact such liquidity, expected 2012 operating
expenses and general and administrative expenses, 2013 capital
expenditure budget and the nature of capital expenditures and the
timing and method of financing thereof, expected 2013 average
production and exit rate, expected costs to satisfy drilling
commitments and method of funding drilling commitments, commodity
prices and expected volatility thereof, estimated amount and timing of
incurring decommissioning liabilities, plans to utilize pad drilling,
and use of funds from property dispositions may constitute
forward-looking statements under applicable securities laws and
necessarily involve risks including, without limitation, risks
associated with oil and gas exploration, development, exploitation,
production, marketing and transportation, loss of markets, volatility
of commodity prices, currency fluctuations, imprecision of reserve
estimates, environmental risks, competition from other producers,
inability to retain drilling rigs and other services, incorrect
assessment of the value of acquisitions, failure to realize the
anticipated benefits of acquisitions, delays resulting from or
inability to obtain required regulatory approvals and ability to access
sufficient capital from internal and external sources. Events or
circumstances may cause actual results to differ materially from those
predicted, as a result of the risk factors set out and other known and
unknown risks, uncertainties, and other factors, many of which are
beyond the control of Bellatrix. In addition, forward-looking
statements or information are based on a number of factors and
assumptions which have been used to develop such statements and
information but which may prove to be incorrect and which have been
used to develop such statements and information in order to provide
shareholders with a more complete perspective on Bellatrix's future
operations. Such information may prove to be incorrect and readers are
cautioned that the information may not be appropriate for other
purposes. Although the Company believes that the expectations
reflected in such forward-looking statements or information are
reasonable, undue reliance should not be placed on forward-looking
statements because the Company can give no assurance that such
expectations will prove to be correct. In addition to other factors
and assumptions which may be identified herein, assumptions have been
made regarding, among other things: the impact of increasing
competition; the general stability of the economic and political
environment in which the Company operates; the timely receipt of any
required regulatory approvals; the ability of the Company to obtain
qualified staff, equipment and services in a timely and cost efficient
manner; drilling results; the ability of the operator of the projects
which the Company has an interest in to operate the field in a safe,
efficient and effective manner; the ability of the Company to obtain
financing on acceptable terms; field production rates and decline
rates; the ability to replace and expand oil and natural gas reserves
through acquisition, development of exploration; the timing and costs
of pipeline, storage and facility construction and expansion and the
ability of the Company to secure adequate product transportation;
future commodity prices; currency, exchange and interest rates; the
regulatory framework regarding royalties, taxes and environmental
matters in the jurisdictions in which the Company operates; and the
ability of the Company to successfully market its oil and natural gas
products. Readers are cautioned that the foregoing list is not
exhaustive of all factors and assumptions which have been used. As a
consequence, actual results may differ materially from those
anticipated in the forward-looking statements. Additional information
on these and other factors that could effect Bellatrix's operations and
financial results are included in reports on file with Canadian and US
securities regulatory authorities and may be accessed through the SEDAR
website (www.sedar.com, and at Bellatrix's website www.bellatrixexploration.com). Furthermore, the forward-looking statements contained herein are
made as at the date hereof and Bellatrix does not undertake any
obligation to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by applicable
securities laws.
The reader is further cautioned that the preparation of financial
statements in accordance with GAAP requires management to make certain
judgments and estimates that affect the reported amounts of assets,
liabilities, revenues and expenses. Estimating reserves is also
critical to several accounting estimates and requires judgments and
decisions based upon available geological, geophysical, engineering and
economic data. These estimates may change, having either a negative or
positive effect on net earnings as further information becomes
available, and as the economic environment changes.
Overview and Description of the Business
Bellatrix Exploration Ltd. ("Bellatrix" or the "Company") is a Western
Canadian based growth oriented oil and gas company engaged in the
exploration for, and the acquisition, development and production of oil
and natural gas reserves in the provinces of Alberta, British Columbia
and Saskatchewan.
Bellatrix is the continuing corporation resulting from the
reorganization (the "Reorganization") effective November 1, 2009
pursuant to a plan of arrangement involving, among others, True Energy
Trust (the "Trust" or "True"), Bellatrix and security holders of the
Trust.
Bellatrix's common shares and convertible debentures are listed on the
Toronto Stock Exchange under the symbols BXE and BXE.DB.A,
respectively, and the common shares of Bellatrix trade on the NYSE MKT
under the symbol BXE.
Third Quarter 2012 Financial and Operational Results
Disposition
During the third quarter of 2012, Bellatrix closed on the disposition of
a minor non-core property interest in the Wainwright area, Alberta for
$4.25 million after adjustments. This non-operated unit heavy oil
property had production of approximately 59 boe/d. The net proceeds
from the disposition were initially used to reduce the Company's bank
indebtedness, and ultimately will be directed towards the development
of the Company's Cardium oil resource program.
Sales Volumes
Sales volumes for the three months ended September 30, 2012 averaged
15,503 boe/d compared to 11,837 boe/d for the same period in 2011,
representing a 31% increase. Total crude oil, condensate and NGLs
averaged approximately 34% of sales volumes for the three months ended
September 30, 2012, compared to 37% of sales volumes in the same period
in 2011. Sales volumes for the nine months ended September 30, 2012
averaged 15,989 boe/d, compared to 11,194 boe/d for the same period in
2011, representing a 43% increase. The increase in sales was primarily
a result of a year over year increased capital program and the
associated drilling success achieved in the Cardium and Notikewin
resource plays. Capital expenditures for the nine months ended
September 30, 2012 were $132.3 million, compared to $132.3 million for
the same period in 2011.
Third quarter 2012 sales volumes decreased by 6% from second quarter
2012 average sales volumes of 16,569 boe/d. The average sales volumes
for the third quarter of 2012 were negatively affected by protracted
spring breakup conditions, scheduled plant turnarounds, a series of
intense localized storms resulting in an unusually high number of
occurrences of unscheduled downtime, and prolonged wet conditions
delaying the third quarter drilling, completion, and tie-in program.
Power outages caused by power poles being struck by lightning, hail,
and intense rain shorted out transformers. In addition, a violent rain
storm shorted out electrical panels which created significant downtime
for a major midstream operator that processes a portion of the
Company's production. However, the Company continues to expect it will
meet its previously announced 2012 calendar year guidance of average
daily production of 16,500 to 17,000 boe/d, and an exit rate of 19,000
boe/d to 19,500 boe/d.
Sales Volumes
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Three months ended
September 30,
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Nine months ended
September 30,
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2012
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2011
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2012
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2011
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Light oil and condensate
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(bbls/d)
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3,672
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3,365
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4,025
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3,245
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NGLs
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(bbls/d)
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1,240
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803
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1,377
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684
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Heavy oil
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(bbls/d)
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292
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245
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311
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313
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Total crude oil, condensate and NGLs
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(bbls/d)
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5,204
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4,413
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5,713
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4,242
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Natural gas
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(mcf/d)
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61,796
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44,546
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61,654
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41,710
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Total boe/d
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(6:1)
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15,503
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11,837
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15,989
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11,194
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During the first nine months of 2012, Bellatrix posted a 100% success
rate drilling and/or participating in 24 gross (20.15 net) wells,
resulting in 18 gross (15.15 net) Cardium oil wells, 2.0 gross (2.0
net) Cardium condensate-rich gas wells, 1.0 gross (1.0 net) Duvernay
gas well, and 3.0 gross (2.0 net) Notikewin/Falher liquids-rich gas
wells. Bellatrix drilled 9 gross (7.71 net) wells consisting of 7
gross (6.21 net) Cardium oil wells and 2 gross (1.5 net) liquids-rich
Notikewin/Falher gas wells in the third quarter of 2012.
By comparison, Bellatrix drilled or participated in 42 gross (27.19 net)
wells during the first nine months of 2011, including 31 gross (22.35
net) oil wells and 11 gross (4.84 net) liquids-rich natural gas wells.
For the three months ended September 30, 2012, crude oil, condensate and
NGL sales volumes increased by approximately 18%, averaging 5,204 bbl/d
compared to 4,413 bbl/d in the third quarter of 2011. For the nine
months ended September 30, 2012, crude oil, condensate and NGL sales
volumes increased by approximately 35%, averaging 5,713 bbl/d compared
to 4,242 bbl/d in the same period in 2011. The weighting towards crude
oil, condensate and NGLs decreased slightly in the third quarter of
2012 at 34%, compared to 37% in the same period in 2011. The reduction
in liquids weighting quarter over quarter was a direct result of adding
the dry gas producing Duvernay well during the second quarter of 2012,
as well as bringing on several other high-productivity gas wells.
The weighting towards crude oil, condensate and NGLs for the nine months
ended September 30, 2012 was 36%, compared to 38% for the same period
in 2011.
Sales of natural gas averaged 61.8 Mmcf/d for the three months ended
September 30, 2012, compared to 44.5 Mmcf/d in the same period in 2011,
an increase of approximately 39%. The weighting towards natural gas
sales volumes averaged approximately 66% for the third quarter of 2012,
compared to 63% in the 2011 third quarter. For the nine months ended
September 30, 2012, sales of natural gas averaged 61.7 Mmcf/d, an
increase of approximately 48% from average sales volumes of 41.7 Mmcf/d
realized in the comparative 2011 period.
For the remainder of 2012, Bellatrix will continue to be active in
drilling its two core resource plays, the Cardium oil and Notikewin
condensate-rich gas, utilizing horizontal drilling multi-fracturing
technology. The Company's 2012 capital expenditure budget is between
$140 to $150 million. Based on the timing of proposed expenditures,
downtime for anticipated plant turnarounds, resolution of
infrastructure constraints and normal production declines, execution of
the 2012 budget is anticipated to provide average daily production of
approximately 16,500 to 17,000 boe/d. The Company is maintaining its
previously announced 2012 exit rate guidance of approximately 19,000
boe/d to 19,500 boe/d.
Commodity Prices
Average Commodity Prices
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Three months ended
September 30,
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Nine months ended
September 30,
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2012
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2011
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%
Change
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2012
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2011
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%
Change
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Exchange rate (US$/CDN$)
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1.0053
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1.0197
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(1)
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0.9981
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1.0224
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(2)
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Crude oil:
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|
|
|
|
WTI (US$/bbl)
|
|
|
|
92.20
|
|
|
89.54
|
|
|
3
|
|
|
|
96.16
|
|
|
95.48
|
|
|
1
|
Edmonton par - light oil ($/bbl)
|
|
|
|
84.79
|
|
|
92.45
|
|
|
(8)
|
|
|
|
87.29
|
|
|
94.32
|
|
|
(7)
|
Bow River - medium/heavy oil ($/bbl)
|
|
|
|
72.51
|
|
|
71.90
|
|
|
1
|
|
|
|
76.50
|
|
|
75.25
|
|
|
2
|
Hardisty Heavy - heavy oil ($/bbl)
|
|
|
|
58.08
|
|
|
62.11
|
|
|
(6)
|
|
|
|
64.69
|
|
|
66.23
|
|
|
(2)
|
Bellatrix's average prices ($/bbl)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Light crude oil and condensate
|
|
|
|
84.98
|
|
|
88.91
|
|
|
(4)
|
|
|
|
87.74
|
|
|
91.42
|
|
|
(4)
|
|
NGLs
|
|
|
|
28.62
|
|
|
51.74
|
|
|
(45)
|
|
|
|
38.90
|
|
|
53.10
|
|
|
(27)
|
|
Heavy crude oil
|
|
|
|
63.95
|
|
|
64.19
|
|
|
-
|
|
|
|
69.17
|
|
|
66.13
|
|
|
5
|
|
Total crude oil and NGLs
|
|
|
|
70.37
|
|
|
80.78
|
|
|
(13)
|
|
|
|
74.96
|
|
|
83.37
|
|
|
(10)
|
|
Total crude oil and NGLs (including risk management (1))
|
|
|
|
70.72
|
|
|
82.38
|
|
|
(14)
|
|
|
|
72.83
|
|
|
80.85
|
|
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NYMEX (US$/mmbtu)
|
|
|
|
2.89
|
|
|
4.05
|
|
|
(29)
|
|
|
|
2.58
|
|
|
4.21
|
|
|
(39)
|
AECO daily index (CDN$/mcf)
|
|
|
|
2.28
|
|
|
3.66
|
|
|
(38)
|
|
|
|
2.11
|
|
|
3.76
|
|
|
(44)
|
AECO monthly index (CDN$/mcf)
|
|
|
|
2.19
|
|
|
3.72
|
|
|
(41)
|
|
|
|
2.18
|
|
|
3.74
|
|
|
(42)
|
Bellatrix's average price ($/mcf)
|
|
|
|
2.45
|
|
|
3.91
|
|
|
(37)
|
|
|
|
2.26
|
|
|
3.97
|
|
|
(43)
|
Bellatrix's average price (including risk management(1)) ($/mcf)
|
|
|
|
3.38
|
|
|
4.33
|
|
|
(22)
|
|
|
|
2.96
|
|
|
4.23
|
|
|
(30)
|
(1) Per unit metrics including risk management include realized gains or
losses on commodity contracts and exclude unrealized gains or losses on
commodity contracts.
For light oil and condensate, Bellatrix recorded an average $84.98/bbl
before commodity price risk management contracts during the third
quarter of 2012, 4% lower than the average price received in the
comparative 2011 period. In comparison, the Edmonton par price
decreased by 8% over the same period. For light oil and condensate,
Bellatrix recorded an average $87.74/bbl before commodity price risk
management contracts during the nine months ended September 30, 2012,
4% lower than the average price received in the comparative 2011
period. In comparison, the Edmonton par price decreased by 7% over the
same period. The average WTI crude oil benchmark price remained
relatively unchanged in the first nine months of 2012 compared to the
same period in 2011. The average US$/CDN$ foreign exchange rate was
0.9981 for the nine months ended September 30, 2012, a decrease of 2%
compared to an average rate of 1.0224 in the same period in 2011.
For NGLs, Bellatrix recorded an average $28.62/bbl during the third
quarter of 2012, a 45% decrease from the $51.74/bbl received in the
comparative 2011 period. For the nine months ended September 30, 2012,
Bellatrix received an average NGL price of $38.90/bbl, a 27% decrease
from the $53.10/bbl received in the comparative 2011 period. The
decrease in NGL pricing between the 2012 and 2011 periods is largely
attributable to changes in NGL market supply conditions between the
periods.
For heavy crude oil, Bellatrix received an average price before
commodity risk management contracts of $63.95/bbl in the 2012 third
quarter, relatively consistent with prices realized in the third
quarter of 2011. For the nine months ended September 30, 2012,
Bellatrix received an average price of $69.17/bbl for heavy crude oil,
a 5% increase when compared to the same period in 2011. In comparison,
the Bow River reference price increased by 1%, and the Hardisty Heavy
reference price decreased by 6% between the third quarter of 2011 and
the third quarter of 2012. Between the first nine months of 2011 and
the first nine months of 2012, the Bow River reference price increased
by 2%, and the Hardisty Heavy reference price decreased by 2%. The
majority of Bellatrix's heavy crude oil density ranges between 11 and
16 degrees API, consistent with the Hardisty Heavy reference price.
Bellatrix's natural gas sales are priced with reference to the daily or
monthly AECO indices. During the third quarter of 2012, the AECO daily
reference price decreased by 38%, and the AECO monthly reference price
decreased by approximately 41% compared to the third quarter of 2011.
Bellatrix's natural gas average sales price before commodity price risk
management contracts for the third quarter of 2012 decreased by 37%
compared to the same period in 2011. During the nine months ended
September 30, 2012, the AECO daily reference price decreased by
approximately 44% and the AECO monthly reference price decreased by
approximately 42%, compared to the nine months ended September 30,
2011. Bellatrix's natural gas average sales price before commodity
price risk management contracts for the nine months ended September 30,
2012 decreased by 43% compared to the same period in 2011. Bellatrix's
natural gas average price after including commodity price risk
management contracts for the three and nine months ended September 30,
2012 was $3.38/mcf and $2.96/mcf, compared to $4.33/mcf and $4.23/mcf
for the three and nine months ended September 30, 2011, respectively.
Revenue
Revenue before other income, royalties and commodity price risk
management contracts for the three months ended September 30, 2012 was
$47.6 million, 2% lower than the $48.8 million in the third quarter of
2011. The decrease in revenues between quarters was due to reduced
liquids and natural gas prices experienced in the third quarter of
2012, largely offset by the impact of increased sales volumes between
the periods. Revenue before other income, royalties and commodity
price risk management contracts for the nine month period ended
September 30, 2012 was $155.6 million, 10% higher than the $141.8
million realized in the comparative 2011 period.
Revenue before other income, royalties and commodity price risk
management contracts for crude oil and NGLs for the three and nine
months ended September 30, 2012 increased from the comparative 2011
periods by approximately 3% and 21%, respectively, resulting from
higher sales volumes, partially offset by lower light crude oil,
condensate and NGL prices when compared to the same periods in 2011.
In the third quarter of 2012, total crude oil, condensate and NGL
revenues contributed 71% of total revenue (before other) compared to
67% in the same period in 2011. For the nine months ended September
30, 2012, total crude oil, condensate and NGL revenues contributed 75%
of total revenue (before other), compared to 68% in the same period in
2011. Light crude oil, condensate and NGL revenues in the three and
nine months ended September 30, 2012 comprised 95% of total crude oil,
condensate and NGL revenues (before other) for those periods, compared
to 96% and 94% composition realized in the three month and nine month
periods ended September 30, 2011, respectively.
Natural gas revenue before other income, royalties and commodity price
risk management contracts for the third quarter of 2012 decreased by
approximately 13% compared to the third quarter of 2011 as a result of
a 37% decrease in realized gas prices before risk management, offset by
an approximate 39% increase in sales volumes between the periods.
Natural gas revenue before other income, royalties and commodity price
risk management contracts for the first nine months of 2012 decreased
by approximately 15% compared to the nine months ended September 30,
2011 as a result of a 43% decrease in realized gas prices before risk
management offset by an approximate 48% increase in sales volumes
between the periods.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Light crude oil and condensate
|
|
|
|
|
|
28,706
|
|
|
|
|
27,527
|
|
|
|
96,766
|
|
|
|
80,987
|
NGLs
|
|
|
|
|
|
3,264
|
|
|
|
|
3,822
|
|
|
|
14,676
|
|
|
|
9,920
|
Heavy oil
|
|
|
|
|
|
1,724
|
|
|
|
|
1,443
|
|
|
|
5,886
|
|
|
|
5,662
|
Crude oil and NGLs
|
|
|
|
|
|
33,694
|
|
|
|
|
32,792
|
|
|
|
117,328
|
|
|
|
96,569
|
Natural gas
|
|
|
|
|
|
13,914
|
|
|
|
|
16,022
|
|
|
|
38,239
|
|
|
|
45,191
|
Total revenue before other
|
|
|
|
|
|
47,608
|
|
|
|
|
48,814
|
|
|
|
155,567
|
|
|
|
141,760
|
Other (1) |
|
|
|
|
|
518
|
|
|
|
|
331
|
|
|
|
1,464
|
|
|
|
1,364
|
Total revenue before royalties and risk management
|
|
|
|
|
|
48,126
|
|
|
|
|
49,145
|
|
|
|
157,031
|
|
|
|
143,124
|
(1) Other revenue primarily consists of processing and other third party
income.
Commodity Price Risk Management
The Company has a formal commodity price risk management policy which
permits management to use specified price risk management strategies
including fixed price contracts, collars and the purchase of floor
price options and other derivative financial instruments and physical
delivery sales contracts to reduce the impact of price volatility for a
maximum of eighteen months beyond the transaction date. The program is
designed to provide price protection on a portion of the Company's
future production in the event of adverse commodity price movement,
while retaining significant exposure to upside price movements. By
doing this, the Company seeks to provide a measure of stability to
funds flow from operations, as well as to ensure Bellatrix realizes
positive economic returns from its capital development and acquisition
activities. The Company plans to continue its commodity price risk
management strategies focusing on maintaining sufficient cash flow to
fund Bellatrix's capital expenditure program. Any remaining production
is realized at market prices.
A summary of the financial commodity price risk management volumes and
average prices by quarter currently outstanding as of November 7, 2012
is shown in the following tables:
Natural gas
Average Volumes (GJ/d)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2012
|
Fixed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,478
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Price ($/GJ AECO C)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2012
|
Fixed
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3.52
|
Crude oil and liquids
Average Volumes (bbls/d)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2012
|
Call option
|
|
|
|
|
|
|
|
|
|
|
|
|
833
|
Fixed
|
|
|
|
|
|
|
|
|
|
|
|
|
3,000
|
Total bbls/d
|
|
|
|
|
|
|
|
|
|
|
|
|
3,833
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2013
|
|
|
Q2 2013
|
|
|
Q3 2013
|
|
|
Q4 2013
|
Call option
|
|
|
|
3,000
|
|
|
3,000
|
|
|
3,000
|
|
|
3,000
|
Fixed
|
|
|
|
1,500
|
|
|
1,500
|
|
|
1,500
|
|
|
1,500
|
Total bbls/d
|
|
|
|
4,500
|
|
|
4,500
|
|
|
4,500
|
|
|
4,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Price ($/bbl WTI)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4 2012
|
Call option (ceiling price) (US$/bbl)
|
|
|
|
|
|
|
|
|
|
|
|
|
110.00
|
Fixed price (CDN$/bbl)
|
|
|
|
|
|
|
|
|
|
|
|
|
92.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 2013
|
|
|
Q2 2013
|
|
|
Q3 2013
|
|
|
Q4 2013
|
Call option (ceiling price) (US$/bbl)
|
|
|
|
110.00
|
|
|
110.00
|
|
|
110.00
|
|
|
110.00
|
Fixed price (CDN$/bbl)
|
|
|
|
94.50
|
|
|
94.50
|
|
|
94.50
|
|
|
94.50
|
Included in the above natural gas table are fixed price contracts of an
average of $4.10/GJ at 30,000 GJ/d from April 1, 2012 to October 31,
2012 which were funded by selling call options of 3,000 bbl/d at
US$110.00 for the 2013 calendar year.
As of September 30, 2012, the fair value of Bellatrix's outstanding
commodity contracts is a net unrealized liability of $1.1 million as
reflected in the financial statements. The fair value or
mark-to-market value of these contracts is based on the estimated
amount that would have been received or paid to settle the contracts as
at September 30, 2012 and will be different from what will eventually
be realized. Changes in the fair value of the commodity contracts are
recognized in the Consolidated Statements of Comprehensive Income
within the financial statements.
The following is a summary of the gain (loss) on commodity contracts for
the three and nine months ended September 30, 2012 and 2011 as
reflected in the Consolidated Statements of Comprehensive Income in the
financial statements:
Commodity contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
|
|
Crude Oil
& Liquids
|
|
|
|
|
Natural
Gas
|
|
|
|
Q3 2012
Total
|
|
|
|
Q3 2011
Total
|
Realized cash gain (loss) on contracts
|
|
|
|
|
|
166
|
|
|
|
|
5,306
|
|
|
|
5,472
|
|
|
|
2,392
|
Unrealized gain (loss) on contracts (1) |
|
|
|
|
|
(1,662)
|
|
|
|
|
(5,101)
|
|
|
|
(6,763)
|
|
|
|
8,556
|
Total gain on commodity contracts
|
|
|
|
|
|
(1,496)
|
|
|
|
|
205
|
|
|
|
(1,291)
|
|
|
|
10,948
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commodity contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
|
|
Crude Oil
& Liquids
|
|
|
|
|
Natural
Gas
|
|
|
|
YTD 2012
Total
|
|
|
|
YTD 2011
Total
|
Realized cash gain (loss) on contracts
|
|
|
|
|
|
(3,326)
|
|
|
|
|
11,779
|
|
|
|
8,453
|
|
|
|
75
|
Unrealized gain (loss) on contracts (1) |
|
|
|
|
|
11,053
|
|
|
|
|
(1,560)
|
|
|
|
9,493
|
|
|
|
10,776
|
Total gain on commodity contracts
|
|
|
|
|
|
7,727
|
|
|
|
|
10,219
|
|
|
|
17,946
|
|
|
|
10,851
|
(1) Unrealized gain (loss) on commodity contracts represent non-cash
adjustments for changes in the fair value of these contracts during the
period.
Royalties
For the three months ended September 30, 2012, total royalties were $8.9
million compared to $8.6 million incurred in the third quarter of
2011. Overall royalties as a percentage of revenue (after
transportation costs) in the third quarter of 2012 were 19%, compared
with 18% in the 2011 third quarter. For the nine months ended
September 30, 2012, total royalties were $26.9 million compared to
$25.9 million incurred in the same period in 2011. Overall royalties
as a percentage of revenue (after transportation costs) for the nine
months ended September 30, 2012 were 18%, compared with 19% in the same
period in 2011.
The Company's heavy oil properties consist of principally the Frog Lake
Alberta assets which are subject to high crown royalty rates. Certain
light oil wells are now incurring higher royalty rates as they come off
the initial royalty incentive rates. The Company's royalty percentage
for natural gas royalties continues to decline due to increased
production from recently drilled wells which take advantage of Alberta
royalty incentive programs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royalties by Commodity Type
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Light crude oil, condensate and NGLs
|
|
|
|
|
|
7,378
|
|
|
|
6,353
|
|
|
|
24,510
|
|
|
|
16,942
|
|
$/bbl
|
|
|
|
|
|
16.33
|
|
|
|
16.57
|
|
|
|
16.56
|
|
|
|
15.80
|
|
Average light crude oil, condensate and
NGLs royalty rate (%)
|
|
|
|
|
|
24
|
|
|
|
21
|
|
|
|
22
|
|
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Heavy Oil
|
|
|
|
|
|
837
|
|
|
|
418
|
|
|
|
2,775
|
|
|
|
2,642
|
|
$/bbl
|
|
|
|
|
|
31.16
|
|
|
|
18.54
|
|
|
|
32.57
|
|
|
|
30.92
|
|
Average heavy oil royalty rate (%)
|
|
|
|
|
|
51
|
|
|
|
29
|
|
|
|
49
|
|
|
|
47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural Gas
|
|
|
|
|
|
664
|
|
|
|
1,815
|
|
|
|
(367)
|
|
|
|
6,338
|
|
$/mcf
|
|
|
|
|
|
0.12
|
|
|
|
0.44
|
|
|
|
(0.02)
|
|
|
|
0.56
|
|
Average natural gas royalty rate (%)
|
|
|
|
|
|
5
|
|
|
|
12
|
|
|
|
(1)
|
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
8,879
|
|
|
|
8,586
|
|
|
|
26,918
|
|
|
|
25,922
|
$/boe
|
|
|
|
|
|
6.23
|
|
|
|
7.88
|
|
|
|
6.14
|
|
|
|
8.48
|
Average total royalty rate (%)
|
|
|
|
|
|
19
|
|
|
|
18
|
|
|
|
18
|
|
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royalties by Type
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Crown royalties
|
|
|
|
|
|
2,744
|
|
|
|
2,776
|
|
|
|
8,663
|
|
|
|
9,461
|
Indian Oil and Gas Canada royalties
|
|
|
|
|
|
1,907
|
|
|
|
2,763
|
|
|
|
4,802
|
|
|
|
6,089
|
Freehold & GORR
|
|
|
|
|
|
4,228
|
|
|
|
3,047
|
|
|
|
13,453
|
|
|
|
10,372
|
Total
|
|
|
|
|
|
8,879
|
|
|
|
8,586
|
|
|
|
26,918
|
|
|
|
25,922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Production
|
|
|
|
|
|
|
|
11,360
|
|
|
|
12,748
|
|
|
|
37,938
|
|
|
|
36,226
|
Transportation
|
|
|
|
|
|
|
|
1,282
|
|
|
|
1,462
|
|
|
|
3,760
|
|
|
|
4,138
|
General and administrative
|
|
|
|
|
|
|
|
3,397
|
|
|
|
3,423
|
|
|
|
9,882
|
|
|
|
8,590
|
Interest and financing charges (1) |
|
|
|
|
|
|
|
2,476
|
|
|
|
1,730
|
|
|
|
7,006
|
|
|
|
5,299
|
Share-based compensation
|
|
|
|
|
|
|
|
945
|
|
|
|
568
|
|
|
|
2,505
|
|
|
|
2,083
|
(1) Does not include financing charges in relation to the Company's
accretion of decommissioning liabilities.
Expenses per boe
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($ per boe)
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Production
|
|
|
|
|
|
|
|
|
|
|
7.96
|
|
|
|
11.71
|
|
|
|
8.66
|
|
|
|
11.85
|
Transportation
|
|
|
|
|
|
|
|
|
|
|
0.90
|
|
|
|
1.34
|
|
|
|
0.86
|
|
|
|
1.35
|
General and administrative
|
|
|
|
|
|
|
|
|
|
|
2.38
|
|
|
|
3.14
|
|
|
|
2.26
|
|
|
|
2.81
|
Interest and financing charges
|
|
|
|
|
|
|
|
|
|
|
1.74
|
|
|
|
1.59
|
|
|
|
1.60
|
|
|
|
1.73
|
Share-based compensation
|
|
|
|
|
|
|
|
|
|
|
0.66
|
|
|
|
0.52
|
|
|
|
0.57
|
|
|
|
0.68
|
Production Expenses
For the three and nine months ended September 30, 2012, production
expenses totaled $11.4 million ($7.96/boe) and $37.9 million
($8.66/boe), respectively, compared to $12.7 million ($11.71/boe) and
$36.2 million ($11.85/boe) recorded in the same periods in 2011. For
the three months ended September 30, 2012, production expenses
decreased overall and on a per boe basis when compared to the same
period in 2011. The decrease in production expenses on a boe basis in
the 2012 third quarter is primarily due to increased production, which
is a result of drilling in both 2011 and the first nine months of 2012
in areas with lower production expenses, as well as reduced processing
fees in certain areas and continued field optimization projects.
Bellatrix is targeting operating costs of approximately $54.0 million
($8.75/boe) for the 2012 year in total, which is a reduction from the
$11.53/boe operating costs incurred for the 2011 year. This is based
upon assumptions of estimated 2012 average production of approximately
16,500 boe/d to 17,000 boe/d, continued field optimization work and
planned capital expenditures in producing areas which are anticipated
to have lower operating costs.
Production Expenses by Commodity Type
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
|
2011
|
Light crude oil, condensate and NGLs
|
|
|
|
|
|
4,745
|
|
|
|
|
5,238
|
|
|
|
15,375
|
|
|
|
|
14,553
|
$/bbl
|
|
|
|
|
|
10.50
|
|
|
|
|
13.66
|
|
|
|
10.39
|
|
|
|
|
13.57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Heavy oil
|
|
|
|
|
|
373
|
|
|
|
|
782
|
|
|
|
1,268
|
|
|
|
|
2,016
|
$/bbl
|
|
|
|
|
|
13.88
|
|
|
|
|
34.69
|
|
|
|
14.88
|
|
|
|
|
23.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas
|
|
|
|
|
|
6,242
|
|
|
|
|
6,728
|
|
|
|
21,295
|
|
|
|
|
19,657
|
$/mcf
|
|
|
|
|
|
1.10
|
|
|
|
|
1.64
|
|
|
|
1.26
|
|
|
|
|
1.73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
11,360
|
|
|
|
|
12,748
|
|
|
|
37,938
|
|
|
|
|
36,226
|
$/boe
|
|
|
|
|
|
7.96
|
|
|
|
|
11.71
|
|
|
|
8.66
|
|
|
|
|
11.85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
11,360
|
|
|
|
|
12,748
|
|
|
|
37,938
|
|
|
|
|
36,226
|
Processing and other third party income (1) |
|
|
|
|
|
(518)
|
|
|
|
|
(331)
|
|
|
|
(1,464)
|
|
|
|
|
(1,364)
|
Total after deducting processing and other
third party income
|
|
|
|
|
|
10,842
|
|
|
|
|
12,417
|
|
|
|
36,474
|
|
|
|
|
34,862
|
$/boe
|
|
|
|
|
|
7.60
|
|
|
|
|
11.40
|
|
|
|
8.33
|
|
|
|
|
11.41
|
(1) |
Processing and other third party income is included within petroleum and
natural gas sales on the
Consolidated Statements of Comprehensive Income.
|
Transportation
Transportation expenses for the three and nine months ended September
30, 2012 were $1.3 million ($0.90/boe) and $3.8 million ($0.86/boe),
respectively, compared to $1.5 million ($1.34/boe) and $4.1 million
($1.35/boe) in the same periods in 2011. The decrease in per boe costs
is reflective of a higher volume of oil production being shipped
through pipelines rather than through trucking at a higher cost, as
well as reduced gas transportation fees resulting from the acquisition
of an ownership interest in certain gathering and processing facilities
in the first half of 2011.
Operating Netback
Field Operating Netback - Corporate (before risk management)
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($/boe)
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Sales
|
|
|
|
|
|
|
|
|
33.38
|
|
|
|
|
44.82
|
|
|
|
|
35.51
|
|
|
|
|
46.39
|
Transportation
|
|
|
|
|
|
|
|
|
(0.90)
|
|
|
|
|
(1.34)
|
|
|
|
|
(0.86)
|
|
|
|
|
(1.35)
|
Royalties
|
|
|
|
|
|
|
|
|
(6.23)
|
|
|
|
|
(7.88)
|
|
|
|
|
(6.14)
|
|
|
|
|
(8.48)
|
Production expense
|
|
|
|
|
|
|
|
|
(7.96)
|
|
|
|
|
(11.71)
|
|
|
|
|
(8.66)
|
|
|
|
|
(11.85)
|
Field operating netback
|
|
|
|
|
|
|
|
|
18.29
|
|
|
|
|
23.89
|
|
|
|
|
19.85
|
|
|
|
|
24.71
|
For the third quarter of 2012, corporate field operating netback (before
commodity price risk management contracts) was $18.29/boe compared to
$23.89/boe in the third quarter of 2011. The reduced netback was
primarily the result of reduced commodity prices, offset by reduced
transportation, royalty and production expenses. After including
commodity price risk management contracts, the corporate field
operating netback for the third quarter of 2012 was $22.13/boe compared
to $26.09/boe in the 2011 third quarter. Per unit metrics including
risk management include realized gains or losses on commodity contracts
and exclude unrealized gains or losses on commodity contracts.
For the nine months ended September 30, 2012, corporate field operating
netback (before commodity price risk management contracts) was
$19.85/boe compared to $24.71/boe in the first nine months of 2011.
The reduced netback was primarily the result of reduced commodity
prices, despite reductions in transportation, royalty and production
expenses. After including commodity price risk management contracts,
the corporate field operating netback for the first nine months of 2012
was $21.78/boe compared to $24.72/boe in the same period in 2011.
Field Operating Netback - Crude Oil, Condensate and NGLs (before risk
management)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($/bbl)
|
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
70.37
|
|
|
|
|
80.77
|
|
|
|
|
74.96
|
|
|
|
|
83.39
|
Transportation
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.40)
|
|
|
|
|
(1.96)
|
|
|
|
|
(1.13)
|
|
|
|
|
(1.99)
|
Royalties
|
|
|
|
|
|
|
|
|
|
|
|
|
(17.16)
|
|
|
|
|
(16.68)
|
|
|
|
|
(17.43)
|
|
|
|
|
(16.91)
|
Production expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(10.69)
|
|
|
|
|
(14.83)
|
|
|
|
|
(10.63)
|
|
|
|
|
(14.31)
|
Field operating netback
|
|
|
|
|
|
|
|
|
|
|
|
|
41.12
|
|
|
|
|
47.30
|
|
|
|
|
45.77
|
|
|
|
|
50.18
|
Field operating netback for crude oil, condensate and NGLs averaged
$41.12/bbl for the three months ended September 30, 2012, a decrease of
13% from $47.30/bbl realized in the comparative 2011 period. In the
third quarter of 2012, Bellatrix's combined crude oil and NGLs average
price (before risk management) decreased by approximately 13% compared
to the third quarter of 2011. The commodity price decrease in
conjunction with a slight increase in royalties was partially offset by
reductions in production, and transportation expenses, resulting in the
overall decrease to the field operating netback for crude oil,
condensate and NGLs. After including commodity price risk management
contracts, field operating netback for crude oil and NGLs for the three
months ended September 30, 2012 decreased to $41.48/boe compared to
$48.91/boe in the same period in 2011.
Field operating netback for crude oil, condensate and NGLs averaged
$45.77/bbl for the nine months ended September 30, 2012, a decrease of
9% from $50.18/bbl realized in the comparative 2011 period. In the
first nine months of 2012, Bellatrix's combined crude oil and NGLs
average price (before risk management) decreased by approximately 10%
compared to the same period in 2011. The commodity price decrease was
partially offset by reductions in production, royalties, and
transportation expenses, resulting in the overall decrease to the field
operating netback for crude oil, condensate and NGLs. After including
commodity price risk management contracts, field operating netback for
crude oil and NGLs for the nine months ended September 30, 2012
decreased to $43.64/boe compared to $47.65/boe in the same period in
2011.
Field Operating Netback - Natural Gas (before risk management)
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($/mcf)
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Sales
|
|
|
|
|
|
|
|
|
|
|
2.45
|
|
|
|
|
3.91
|
|
|
|
|
2.26
|
|
|
|
|
3.97
|
Transportation
|
|
|
|
|
|
|
|
|
|
|
(0.11)
|
|
|
|
|
(0.16)
|
|
|
|
|
(0.12)
|
|
|
|
|
(0.16)
|
Royalties
|
|
|
|
|
|
|
|
|
|
|
(0.12)
|
|
|
|
|
(0.44)
|
|
|
|
|
0.02
|
|
|
|
|
(0.56)
|
Production expense
|
|
|
|
|
|
|
|
|
|
|
(1.10)
|
|
|
|
|
(1.64)
|
|
|
|
|
(1.26)
|
|
|
|
|
(1.73)
|
Field operating netback
|
|
|
|
|
|
|
|
|
|
|
1.12
|
|
|
|
|
1.67
|
|
|
|
|
0.90
|
|
|
|
|
1.52
|
Field operating netback for natural gas in the third quarter of 2012
year decreased by 33% to $1.12/mcf, compared to $1.67/mcf realized in
the third quarter of 2011, reflecting depressed natural gas prices,
offset somewhat by lower production, transportation and royalty
expenses. After including commodity price risk management contracts,
field operating netback for natural gas for the three months ended
September 30, 2012 increased to $2.06/mcf, which compared to $2.09/mcf
in the third quarter of 2011.
Field operating netback for natural gas in the nine months ended
September 30, 2012 year decreased by 41% to $0.90/mcf, compared to
$1.52/mcf realized in the third quarter of 2011, reflecting depressed
natural gas prices, offset somewhat by lower production, transportation
and royalty expenses. After including commodity price risk management
contracts, field operating netback for natural gas for the nine months
ended September 30, 2012 increased to $1.60/mcf, which compared to
$1.79/mcf in the same period in 2011.
General and Administrative
General and administrative ("G&A") expenses (after capitalized G&A and
recoveries) for the three and nine month periods ended September 30,
2012 were $3.4 million ($2.38/boe) and $9.9 million ($2.26/boe),
respectively, compared to $3.4 million ($3.14/boe) and $8.6 million
($2.81/boe) for the same periods in 2011. G&A expenses remained
consistent on an overall basis in the third quarter of 2012 compared to
the same period in 2011. For the nine months ended September 30, 2012,
G&A expenses were slightly higher in comparison to the same period in
2011 which is reflective of higher compensation and base costs and
lower recoveries, offset partially by higher capitalized G&A. On a boe
basis, G&A for the third quarter of 2012 decreased by approximately 24%
when compared to the third quarter of 2011. The decrease was primarily
as a result of higher average sales volumes in the 2012 period, despite
higher overall costs.
For 2012, the Company is anticipating G&A expenses after capitalization
to be approximately $14.0 million ($2.27/boe) based on estimated 2012
average production volumes of approximately 16,500 boe/d to 17,000
boe/d. This compares to actual 2011 G&A costs of $2.83/boe.
General and Administrative Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Gross expenses
|
|
|
|
|
|
5,111
|
|
|
|
|
4,419
|
|
|
|
|
15,104
|
|
|
|
|
13,547
|
Capitalized
|
|
|
|
|
|
(1,045)
|
|
|
|
|
(867)
|
|
|
|
|
(3,206)
|
|
|
|
|
(2,620)
|
Recoveries
|
|
|
|
|
|
(669)
|
|
|
|
|
(129)
|
|
|
|
|
(2,016)
|
|
|
|
|
(2,337)
|
G&A expenses
|
|
|
|
|
|
3,397
|
|
|
|
|
3,423
|
|
|
|
|
9,882
|
|
|
|
|
8,590
|
G&A expenses, per unit ($/boe)
|
|
|
|
|
|
2.38
|
|
|
|
|
3.14
|
|
|
|
|
2.26
|
|
|
|
|
2.81
|
Interest and Financing Charges
Bellatrix recorded $2.5 million and $7.0 million of interest and
financing charges related to bank debt and its debentures for the three
and nine month periods ended September 30, 2012, compared to $1.7
million and $5.3 million in the three and nine month periods ended
September 30, 2011, respectively. The increase in interest and
financing charges between these periods was primarily due to greater
interest and accretion charges in relation to the Company's outstanding
debentures in conjunction with higher interest charges related to the
Company's long-term debt as the Company carried a higher average debt
balance in the 2012 periods compared to the same periods in 2011.
Bellatrix's total net debt at September 30, 2012 of $166.2 million
includes the $50.3 million liability portion of its $55 million
principal amount of 4.75% convertible unsecured subordinated debentures
(the "4.75% Debentures"), $104.6 million of bank debt and the net
balance of the working capital deficiency. Total net debt of $101.3
million as of September 30, 2011 reflected a temporary reduction in
bank indebtedness following the completion of a $55 million equity
issuance in May 2011. The 4.75% Debentures have a maturity date of
April 30, 2015.
Interest and Financing Charges (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Interest and financing charges
|
|
|
|
|
|
2,476
|
|
|
|
|
1,730
|
|
|
|
|
7,006
|
|
|
|
|
5,299
|
Interest and financing charges ($/boe)
|
|
|
|
|
|
1.74
|
|
|
|
|
1.59
|
|
|
|
|
1.60
|
|
|
|
|
1.73
|
(1) |
Does not include financing charges in relation to the Company's
accretion of decommissioning liabilities
|
|
|
Debt to Funds Flow from Operations Ratio
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt to funds flow from operations (1)ratio (annualized) (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds flow from operations (1) (annualized)
|
|
|
|
|
|
106,452
|
|
|
|
98,856
|
|
|
|
108,231
|
|
|
|
85,489
|
Total net debt (2) at period end
|
|
|
|
|
|
166,219
|
|
|
|
101,336
|
|
|
|
166,219
|
|
|
|
101,336
|
Total net debt to periods funds flow from operations ratio
(annualized) (3) |
|
|
|
|
|
1.6x
|
|
|
|
1.1x
|
|
|
|
1.5x
|
|
|
|
1.2x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net debt (2) (excluding convertible debentures) at period end
|
|
|
|
|
|
115,950
|
|
|
|
52,644
|
|
|
|
115,950
|
|
|
|
52,644
|
Net debt to periods funds flow from operations
ratio (annualized) (3) |
|
|
|
|
|
1.1x
|
|
|
|
0.6x
|
|
|
|
1.1x
|
|
|
|
0.6x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt to funds flow from operations (1)ratio (trailing) (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds flow from operations (1) (trailing)
|
|
|
|
|
|
112,643
|
|
|
|
80,459
|
|
|
|
112,643
|
|
|
|
80,459
|
Total net debt (2) to funds flow from operations (trailing)
|
|
|
|
|
|
1.5x
|
|
|
|
1.3x
|
|
|
|
1.5x
|
|
|
|
1.3x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net debt (2) (excluding convertible debentures) to funds flow
from operations for the period
|
|
|
|
|
|
1.0x
|
|
|
|
0.7x
|
|
|
|
1.0x
|
|
|
|
0.7x
|
(1) |
As detailed previously in this Management's Discussion and Analysis,
funds flow from operations is a term that
does not have any standardized meaning under GAAP. Funds flow from
operations is calculated as cash flow from
operating activities, less decommissioning costs incurred and changes in
non-cash working capital incurred. Refer
to the reconciliation of cash flow from operating activities to funds
flow from operations appearing elsewhere herein.
|
(2) |
Net debt and total net debt are considered non-GAAP terms. The
Company's calculation of total net debt includes
the liability component of convertible debentures and excludes deferred
liabilities, long-term commodity contract
liabilities, decommissioning liabilities, long-term finance lease
obligation and the deferred tax liability. Net debt and
total net debt include the net working capital deficiency (excess)
before short-term commodity contract assets and
liabilities and current finance lease obligation. Net debt also
excludes the liability component of convertible debentures.
Total net debt and net debt are non-GAAP measures; refer to the
following reconciliation of total liabilities to total net
debt and net debt.
|
(3) |
Total net debt and net debt to periods funds flow from operations ratio
(annualized) is calculated based upon third
quarter funds flow from operations annualized.
|
(4) |
Trailing periods funds flow from operations ratio annualized is based on
the twelve-month periods ended September 30,
2012 and September 30, 2011.
|
|
|
Reconciliation of Total Liabilities to Total Net Debt and Net Debt
|
|
|
|
|
|
|
|
|
As at September 30,
|
($000s)
|
|
|
|
|
|
|
|
2012
|
|
|
|
2011
|
Total liabilities per financial statements
|
|
|
|
|
|
|
|
257,600
|
|
|
|
185,463
|
|
Current liabilities included within working capital calculation
|
|
|
|
|
|
|
|
(54,967)
|
|
|
|
(54,511)
|
|
Deferred liability - flow-through shares
|
|
|
|
|
|
|
|
-
|
|
|
|
(434)
|
|
Commodity contract liability
|
|
|
|
|
|
|
|
(692)
|
|
|
|
(199)
|
|
Decommissioning Liabilities
|
|
|
|
|
|
|
|
(42,784)
|
|
|
|
(42,918)
|
|
Finance lease obligation
|
|
|
|
|
|
|
|
(4,246)
|
|
|
|
(1,330)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Working Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
(42,705)
|
|
|
|
(45,445)
|
|
Current liabilities
|
|
|
|
|
|
|
|
54,967
|
|
|
|
54,511
|
|
Current portion of finance lease
|
|
|
|
|
|
|
|
(507)
|
|
|
|
(151)
|
|
Net commodity contract asset (liability)
|
|
|
|
|
|
|
|
(447)
|
|
|
|
6,350
|
|
|
|
|
|
|
|
|
11,308
|
|
|
|
15,265
|
Total net debt
|
|
|
|
|
|
|
|
166,219
|
|
|
|
101,336
|
Convertible debentures
|
|
|
|
|
|
|
|
(50,269)
|
|
|
|
(48,692)
|
Net debt
|
|
|
|
|
|
|
|
115,950
|
|
|
|
52,644
|
Share-Based Compensation
Non-cash share-based compensation expense for the three months ended
September 30, 2012 was an expense of $0.9 million compared to $0.6
million in the same period in 2011. The increase in non-cash
share-based compensation expense between the third quarter of 2011 and
the third quarter of 2012 is primarily a result of higher Deferred
Share Unit Plan expenses of $0.4 million, compared to a net recovery of
$0.1 million recognized in the comparative 2011 period which was the
result of the revaluation of outstanding Deferred Share Units to a
lower unit price for that quarter.
Non-cash share-based compensation expense for the nine months ended
September 30, 2012 was an expense of $2.5 million compared to $2.1
million in the same period in 2011. The overall increase in non-cash
share-based compensation expense between the first nine months of 2011
and the first nine months of 2012 is primarily a result of a larger
number of outstanding share options expensed during the period and
greater Deferred Share Unit Plan expenses of $0.8 million (2011: $0.6
million), offset partially by higher capitalized share-based
compensation of $1.2 million (2011: $0.9 million).
Depletion and Depreciation
Depletion and depreciation expenses for the three and nine month periods
ended September 30, 2012 were $18.0 million ($12.59/boe) and $57.1
million ($13.04/boe), compared to $15.8 million ($14.52/boe) and $45.8
million ($14.98/boe) recognized in the three and nine month periods
ended September 30, 2011, respectively. For both the three and nine
month periods ended September 30, 2012, the decrease in depletion and
depreciation expense, on a per boe basis, was primarily a result of an
increase in the reserve base used for the depletion calculation,
partially offset by a higher cost base and increased future development
costs.
For the three months ended September 30, 2012 Bellatrix has included a
total of $371.9 million (2011: $159.8 million) for future development
costs in the depletion calculation and excluded from the depletion
calculation a total of $34.8 million (2011: $34.9 million) for
estimated salvage.
Depletion and Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s, except where noted)
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Depletion and Depreciation
|
|
|
|
|
|
|
|
|
17,953
|
|
|
|
|
15,815
|
|
|
|
|
57,125
|
|
|
|
|
45,764
|
Per unit ($/boe)
|
|
|
|
|
|
|
|
|
12.59
|
|
|
|
|
14.52
|
|
|
|
|
13.04
|
|
|
|
|
14.98
|
Impairment of Assets
In accordance with IFRS, the Company calculates an impairment test when
there are indicators of impairment. The impairment test is performed
at the asset or cash generating unit ("CGU") level. IAS 36 -
"Impairment of Assets" ("IAS 36") is a one step process for testing and
measuring impairment of assets. Under IAS 36, the asset or CGU's
carrying value is compared to the higher of: value-in-use and fair
value less costs to sell. Value in use is defined as the present value
of the future cash flows expected to be derived from the asset or CGU.
As at September 30, 2012, Bellatrix reviewed and determined there were
no impairment indicators requiring an impairment test to be performed.
When performed, the impairment test will be based upon the higher of
value-in-use and estimated fair market values for the Company's
properties, including but not limited to an updated external reserve
engineering report which incorporates a full evaluation of reserves on
an annual basis or internal reserve updates at quarterly periods, and
the latest commodity pricing deck. Estimating reserves is very
complex, requiring many judgments based on available geological,
geophysical, engineering and economic data. Changes in these judgments
could have a material impact on the estimated reserves. These
estimates may change, having either a negative or positive effect on
net earnings as further information becomes available and as the
economic environment changes.
Income Taxes
Deferred income taxes arise from differences between the accounting and
tax basis of the Company's assets and liabilities. For the nine months
ended September 30, 2012, the Company recognized a deferred income tax
expense of $6.8 million compared to a deferred income tax expense of
$4.8 million in the first nine months of 2011.
At September 30, 2012, the Company had a total deferred tax asset
balance of $4.4 million.
At September 30, 2012, Bellatrix had approximately $560 million in tax
pools available for deduction against future income as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
|
|
Rate %
|
|
|
|
|
|
2012
|
|
|
|
|
|
2011
|
Intangible resource pools:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canadian exploration expenses
|
|
|
|
|
|
100
|
|
|
|
|
|
45,900
|
|
|
|
|
|
43,000
|
|
Canadian development expenses
|
|
|
|
|
|
30
|
|
|
|
|
|
375,200
|
|
|
|
|
|
322,000
|
|
Canadian oil and gas property expenses
|
|
|
|
|
|
10
|
|
|
|
|
|
22,300
|
|
|
|
|
|
24,000
|
|
Foreign resource expenses
|
|
|
|
|
|
10
|
|
|
|
|
|
800
|
|
|
|
|
|
1,000
|
Attributed Canadian Royalty Income
|
|
|
|
|
|
(Alberta) 100
|
|
|
|
|
|
16,100
|
|
|
|
|
|
16,000
|
Undepreciated capital cost (1) |
|
|
|
|
|
6 - 55
|
|
|
|
|
|
86,300
|
|
|
|
|
|
79,000
|
Non-capital losses (expire through 2027)
|
|
|
|
|
|
100
|
|
|
|
|
|
10,000
|
|
|
|
|
|
10,000
|
Financing costs
|
|
|
|
|
|
20 S.L.
|
|
|
|
|
|
3,300
|
|
|
|
|
|
4,000
|
|
|
|
|
|
|
|
|
|
|
|
|
559,900
|
|
|
|
|
|
499,000
|
(1) Approximately $80 million of undepreciated capital cost pools are class
41, which is claimed at a 25% rate.
Cash Flow from Operating Activities, Funds Flow from Operations and Net
Profit
As detailed previously in this MD&A, funds flow from operations is a
term that does not have any standardized meaning under GAAP. Funds
flow from operations is calculated as cash flow from operating
activities before decommissioning costs incurred and changes in
non-cash working capital incurred.
Reconciliation of Cash Flow from Operating Activities and Funds Flow
from Operations
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Cash flow from operating activities
|
|
|
|
|
|
24,807
|
|
|
|
|
28,023
|
|
|
|
|
77,321
|
|
|
|
|
67,566
|
Decommissioning costs incurred
|
|
|
|
|
|
196
|
|
|
|
|
(87)
|
|
|
|
|
559
|
|
|
|
|
383
|
Change in non-cash working capital
|
|
|
|
|
|
1,610
|
|
|
|
|
(3,972)
|
|
|
|
|
3,293
|
|
|
|
|
(3,832)
|
Funds flow from operations
|
|
|
|
|
|
26,613
|
|
|
|
|
23,964
|
|
|
|
|
81,173
|
|
|
|
|
64,117
|
Bellatrix's cash flow from operating activities of $24.8 million ($0.23
per basic share and $0.22 per diluted share) for the three months ended
September 30, 2012 decreased approximately 11% from the $28.0 million
($0.26 per basic share and $0.24 per diluted share) generated in the
comparative 2011 period. Bellatrix generated funds flow from
operations of $26.6 million ($0.25 per basic share and $0.23 per
diluted share) for the three months ended September 30, 2012, an
increase of 11% from $24.0 million ($0.22 per basic share and $0.21 per
diluted share) for the comparative 2011 period.
Bellatrix's cash flow from operating activities of $77.3 million ($0.72
per basic share and $0.67 per diluted share) for the nine months ended
September 30, 2012 increased approximately 14% from the $67.6 million
($0.66 per basic share and $0.61 per diluted share) generated in the
comparative 2011 period. Bellatrix generated funds flow from
operations of $81.2 million ($0.76 per basic share and $0.70 per
diluted share) for the nine months ended September 30, 2012, an
increase of 27% from $64.1 million ($0.62 per basic share and $0.58 per
diluted share) for the comparative 2011 period.
The increase between the three and nine month periods ended September
30, 2012 and the comparative 2011 periods was principally due to higher
net realized gains on the Company's commodity risk management
contracts, despite lower operating netbacks due to significantly
reduced commodity prices and financing expenses experienced during the
2012 periods, and slightly higher general and administrative expenses
for the nine month period.
Bellatrix maintains a commodity price risk management program to provide
a measure of stability to funds flow from operations. Unrealized
mark-to-market gains or losses are non-cash adjustments to the current
fair market value of the contract over its entire term and are included
in the calculation of net profit.
As previously noted in this MD&A, net profit before the unrealized gain
on commodity contracts and gain (loss) on property dispositions is a
non-GAAP measure. A reconciliation between this measure and net loss
per the Consolidated Statement of Comprehensive Income is provided
below.
For the three months ended September 30, 2012, net profit before
non-cash impairment loss, unrealized gain (loss) on commodity
contracts, and gain (loss) on property dispositions, net of associated
deferred tax impacts, was $5.2 million compared to a net profit of $4.2
million in the third quarter of 2011. For the nine months ended
September 30, 2012, net profit before non-cash impairment loss,
unrealized gain (loss) on commodity contracts, and gain (loss) on
property dispositions, net of associated deferred tax impacts, was
$14.4 million compared to a net profit of $9.2 million in the nine
months ended September 30, 2011.
Reconciliation of Net Profit (Loss) to Net Profit Before Non-Cash
Impairment Loss, Unrealized Gain (Loss) on Commodity Contracts, and Gain (Loss) on Property Dispositions
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Net profit (loss) per financial statements
|
|
|
|
|
|
(615)
|
|
|
|
|
820
|
|
|
|
|
18,520
|
|
|
|
|
7,648
|
Items subject to reversal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment loss on property, plant and equipment
|
|
|
|
|
|
-
|
|
|
|
|
14,551
|
|
|
|
|
-
|
|
|
|
|
14,551
|
|
Unrealized (gain) loss on commodity contracts
|
|
|
|
|
|
6,763
|
|
|
|
|
(8,556)
|
|
|
|
|
(9,493)
|
|
|
|
|
(10,776)
|
|
Loss (gain) on property dispositions
|
|
|
|
|
|
1,035
|
|
|
|
|
(1,531)
|
|
|
|
|
4,063
|
|
|
|
|
(1,750)
|
|
Deferred tax impact of above items
|
|
|
|
|
|
(1,950)
|
|
|
|
|
(1,116)
|
|
|
|
|
1,358
|
|
|
|
|
(506)
|
Net profit before non-cash impairment loss, unrealized
gain (loss) on commodity contracts, and gain (loss) on
property dispositions
|
|
|
|
|
|
5,233
|
|
|
|
|
4,168
|
|
|
|
|
14,448
|
|
|
|
|
9,167
|
A net loss of $0.6 million ($0.01 per basic share and $0.01 per diluted
share) was recognized for the three months ended September 30, 2012,
compared to a net profit of $0.8 million ($0.01 per basic share and
$0.01 per diluted share) in the third quarter of 2011. The net loss
recorded in the three months ended September 30, 2012 compared to the
net profit recognized for the same period in 2011 is primarily a
consequence of higher depletion and depreciation expense, an unrealized
loss on commodity contracts compared to an unrealized gain in the
comparative 2011 period, and a total net loss on property dispositions
compared to a net gain in the 2011 period, partially offset by higher
cash flows as noted above.
A net profit of $18.5 million ($0.17 per basic share and $0.17 per
diluted share) was recognized for the nine months ended September 30,
2012, compared to a net profit of $7.6 million ($0.07 per basic share
and $0.07 per diluted share) in the first nine months of 2011. The net
profit recorded in the nine months ended September 30, 2012 compared to
the same period in 2011 is primarily a consequence of higher cash flows
as noted above, offset somewhat by a higher depletion and depreciation
expense, a total net loss on property dispositions compared to a minor
gain on property dispositions in the comparative 2011 period, and a
higher deferred tax expense.
Cash Flow from Operating Activities, Funds Flow from Operations and Net
Profit (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Cash flow from operating activities
|
|
|
|
|
|
|
|
|
|
|
24,807
|
|
|
|
|
28,023
|
|
|
|
|
77,321
|
|
|
|
|
67,566
|
|
Basic ($/share)
|
|
|
|
|
|
|
|
|
|
|
0.23
|
|
|
|
|
0.26
|
|
|
|
|
0.72
|
|
|
|
|
0.66
|
|
Diluted ($/share)
|
|
|
|
|
|
|
|
|
|
|
0.22
|
|
|
|
|
0.24
|
|
|
|
|
0.67
|
|
|
|
|
0.61
|
Funds flow from operations
|
|
|
|
|
|
|
|
|
|
|
26,613
|
|
|
|
|
23,964
|
|
|
|
|
81,173
|
|
|
|
|
64,117
|
|
Basic ($/share)
|
|
|
|
|
|
|
|
|
|
|
0.25
|
|
|
|
|
0.22
|
|
|
|
|
0.76
|
|
|
|
|
0.62
|
|
Diluted ($/share)
|
|
|
|
|
|
|
|
|
|
|
0.23
|
|
|
|
|
0.21
|
|
|
|
|
0.70
|
|
|
|
|
0.58
|
Net profit (loss)
|
|
|
|
|
|
|
|
|
|
|
(615)
|
|
|
|
|
820
|
|
|
|
|
18,520
|
|
|
|
|
7,648
|
|
Basic ($/share)
|
|
|
|
|
|
|
|
|
|
|
(0.01)
|
|
|
|
|
0.01
|
|
|
|
|
0.17
|
|
|
|
|
0.07
|
|
Diluted ($/share)
|
|
|
|
|
|
|
|
|
|
|
(0.01)
|
|
|
|
|
0.01
|
|
|
|
|
0.17
|
|
|
|
|
0.07
|
Capital Expenditures
Bellatrix invested $39.8 million and $132.3 million in capital projects
during the three and nine month periods ended September 30, 2012,
compared to $44.2 million and $132.3 million in the three and nine
month periods ended September 30, 2011, respectively.
Capital Expenditures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
September 30,
|
|
|
|
|
Nine months ended
September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
|
2011
|
|
|
|
|
2012
|
|
|
|
|
2011
|
Lease acquisitions and retention
|
|
|
|
|
|
1,757
|
|
|
|
|
5,160
|
|
|
|
|
4,951
|
|
|
|
|
15,324
|
Geological and geophysical
|
|
|
|
|
|
254
|
|
|
|
|
72
|
|
|
|
|
296
|
|
|
|
|
390
|
Drilling and completion costs
|
|
|
|
|
|
28,286
|
|
|
|
|
34,762
|
|
|
|
|
98,424
|
|
|
|
|
96,855
|
Facilities and equipment
|
|
|
|
|
|
9,521
|
|
|
|
|
4,371
|
|
|
|
|
28,433
|
|
|
|
|
16,612
|
|
|
|
|
|
|
39,818
|
|
|
|
|
44,365
|
|
|
|
|
132,104
|
|
|
|
|
129,181
|
Drilling incentive credits
|
|
|
|
|
|
-
|
|
|
|
|
(272)
|
|
|
|
|
-
|
|
|
|
|
(827)
|
|
Exploration and development (1) |
|
|
|
|
|
39,818
|
|
|
|
|
44,093
|
|
|
|
|
132,104
|
|
|
|
|
128,354
|
Corporate (2) |
|
|
|
|
|
22
|
|
|
|
|
60
|
|
|
|
|
166
|
|
|
|
|
222
|
Property acquisitions
|
|
|
|
|
|
-
|
|
|
|
|
74
|
|
|
|
|
30
|
|
|
|
|
3,723
|
|
Total capital expenditures - cash
|
|
|
|
|
|
39,840
|
|
|
|
|
44,227
|
|
|
|
|
132,300
|
|
|
|
|
132,299
|
Property dispositions - cash
|
|
|
|
|
|
(4,325)
|
|
|
|
|
(4,140)
|
|
|
|
|
(6,670)
|
|
|
|
|
(4,181)
|
|
Total net capital expenditures - cash
|
|
|
|
|
|
35,515
|
|
|
|
|
40,087
|
|
|
|
|
125,630
|
|
|
|
|
128,118
|
Other - non-cash (3) |
|
|
|
|
|
(1,756)
|
|
|
|
|
3,457
|
|
|
|
|
(1,612)
|
|
|
|
|
4,410
|
Total net capital expenditures
|
|
|
|
|
|
33,759
|
|
|
|
|
43,544
|
|
|
|
|
124,018
|
|
|
|
|
132,528
|
(1) Excludes capitalized costs related to decommissioning liabilities
expenditures incurred during the period. (2) Corporate includes office furniture, fixtures and equipment. (3) Other includes non-cash adjustments for the current period's
decommissioning liabilities and share based compensation.
During the first nine months of 2012, Bellatrix posted a 100% success
rate drilling and/or participating in 24 gross (20.15 net) wells,
resulting in 18 gross (15.15 net) Cardium oil wells, 2.0 gross (2.0
net) Cardium condensate-rich gas wells, 1.0 gross (1.0 net) Duvernay
gas well, and 3.0 gross (2.0 net) Notikewin/Falher liquids-rich gas
wells. Bellatrix drilled 9 gross (7.71 net) wells consisting of 7
gross (6.21 net) Cardium oil wells and 2 gross (1.5 net) liquids-rich
Notikewin/Falher gas wells in the third quarter of 2012.
By comparison, Bellatrix drilled or participated in 42 gross (27.19 net)
wells during the first nine months of 2011, including 31 gross (22.35
net) oil wells and 11 gross (4.84 net) liquids-rich natural gas wells.
The $39.8 million capital program for the three months ended September
30, 2012 was financed from funds flow from operations and bank debt.
In the third quarter of 2012, the Company spent $39.8 million on capital
projects which included the aforementioned drilling program coupled
with commissioning a 30 mmcf/d compression facility in the Ferrier
area, installation of 7.2 miles of a 10 inch high-pressure gas line
with a 4 inch condensate line and a 2 inch fuel gas line, a total of
14.3 miles of 10 and 8 inch gathering system trunk lines, and 4.5 miles
of 6 inch gathering system lines to tie in the wells drilled in the
quarter.
The Company's capital program for 2012 is between $140 and $150 million
funded from the Company's cash flows and to the extent necessary, bank
indebtedness. The 2012 capital budget is expected to be directed
primarily towards horizontal drilling and completions activities in the
Cardium and Notikewin areas.
Decommissioning Liabilities
At September 30, 2012, Bellatrix has recorded decommissioning
liabilities of $42.8 million, compared to $45.1 million at December 31,
2011, for future abandonment and reclamation of the Company's
properties. For the nine months ended September 30, 2012,
decommissioning liabilities decreased by a net $2.3 million as a result
of a reduction of $3.0 million for liabilities reversed on dispositions
and a $0.7 million reduction for changes in estimates, offset by $0.9
million incurred on property acquisitions and development activities
and $0.5 million as a result of charges for the unwinding of the
discount rates used for fair valuing the liabilities. The $0.7 million
decrease as a result of changes in estimates is primarily due to a
discount rate variations at September 30, 2012 compared to December 31,
2011, in addition to other abandonment liability revisions.
Liquidity and Capital Resources
As an oil and gas business, Bellatrix has a declining asset base and
therefore relies on ongoing development and acquisitions to replace
production and add additional reserves. Future oil and natural gas
production and reserves are highly dependent on the success of
exploiting the Company's existing asset base and in acquiring
additional reserves. To the extent Bellatrix is successful or
unsuccessful in these activities, cash flow could be increased or
reduced.
Bellatrix is focused on growing oil and natural gas production from its
diversified portfolio of existing and emerging resource plays in
Western Canada. Bellatrix remains highly focused on key business
objectives of maintaining financial strength, optimizing capital
investments - attained through a disciplined approach to capital
spending, a flexible investment program and financial stewardship.
Natural gas prices are primarily driven by North American supply and
demand, with weather being the key factor in the short term. Bellatrix
believes that natural gas represents an abundant, secure, long-term
supply of energy to meet North American needs. Bellatrix's results are
affected by external market and risk factors, such as fluctuations in
the prices of crude oil and natural gas, movements in foreign currency
exchange rates and inflationary pressures on service costs. Market
conditions have resulted in Bellatrix experiencing primarily downward
trends in crude oil pricing for 2012 compared to 2011, and a more
significant downward trend in natural gas pricing, although natural gas
prices have recently started to recover in 2012.
Liquidity risk is the risk that Bellatrix will not be able to meet its
financial obligations as they become due. Bellatrix actively manages
its liquidity through daily and longer-term cash, debt and equity
management strategies. Such strategies encompass, among other factors:
having adequate sources of financing available through its bank credit
facilities, estimating future cash generated from operations based on
reasonable production and pricing assumptions, analysis of economic
risk management opportunities, and maintaining sufficient cash flows
for compliance with operating debt covenants. Bellatrix is fully
compliant with all of its operating debt covenants.
Bellatrix generally relies on operating cash flows and its credit
facilities to fund capital requirements and provide liquidity. Future
liquidity depends primarily on cash flow generated from operations,
existing credit facilities and the ability to access debt and equity
markets. From time to time, the Company accesses capital markets to
meet its additional financing needs and to maintain flexibility in
funding its capital programs. There can be no assurance that future
debt or equity financing, or cash generated by operations will be
available or sufficient to meet these requirements or for other
corporate purposes or, if debt or equity financing is available, that
it will be on terms acceptable to Bellatrix.
Credit risk is the risk of financial loss to Bellatrix if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from Bellatrix's trade receivables
from joint venture partners, petroleum and natural gas marketers, and
financial derivative counterparties.
A substantial portion of Bellatrix's accounts receivable are with
customers and joint interest partners in the petroleum and natural gas
industry and are subject to normal industry credit risks. Bellatrix
sells substantially all of its production to eight primary purchasers
under standard industry sale and payment terms. The most significant
60 day exposure to a single counterparty is currently approximately
$10.2 million. Purchasers of Bellatrix's natural gas, crude oil and
natural gas liquids are subject to a periodic internal credit review to
minimize the risk of non-payment. Bellatrix has continued to closely
monitor and reassess the creditworthiness of its counterparties,
including financial institutions. This has resulted in Bellatrix
reducing or mitigating its exposures to certain counterparties where it
is deemed warranted and permitted under contractual terms.
Bellatrix may be exposed to third party credit risk through its
contractual arrangements with its current or future joint venture
partners, marketers of its petroleum and natural gas production,
derivative counterparties and other parties. In the event such
entities fail to meet their contractual obligations to Bellatrix, such
failures may have a material adverse effect on the Company's business,
financial condition, results of operations and prospects. In addition,
poor credit conditions in the industry and of joint venture partners
may impact a joint venture partner's willingness to participate in
Bellatrix's ongoing capital program, potentially delaying the program
and the results of such program until Bellatrix finds a suitable
alternative partner.
Total net debt levels of $166.2 million at September 30, 2012 have
increased by $46.9 million from $119.3 million at December 31, 2011,
primarily as a consequence of an increase in a working capital
deficiency and bank debt as the Company executed the first nine months
of its 2012 capital program. Total net debt of $101.3 million as of
September 30, 2011 reflected a temporary reduction in bank indebtedness
following the completion of a $55 million equity issuance in May 2011.
Total net debt includes the liability component of the 4.75% Debentures
and excludes unrealized commodity contract assets and liabilities,
deferred taxes, finance lease obligations, deferred liabilities and
decommissioning liabilities.
Funds flow from operations represents 67% of the funding requirements
for Bellatrix's capital expenditures for the three months ended
September 30, 2012.
Effective May 25, 2012, the Company's borrowing base was increased from
$170 million to $200 million through November 30, 2012 and the
revolving period of the credit facility was extended from June 26, 2012
to June 25, 2013. The Company's credit facilities consist of a $15
million demand operating facility provided by a Canadian bank and a
$185 million extendible revolving term credit facility provided by two
Canadian banks and a Canadian financial institution. Amounts borrowed
under the credit facility bear interest at a floating rate based on the
applicable Canadian prime rate, U.S. base rate or LIBOR margin rate,
plus between 1.00% and 3.50%, depending on the type of borrowing and
the Company's debt to cash flow ratio. The credit facilities are
secured by a $400 million debenture containing a first ranking charge
and security interest. Bellatrix has provided a negative pledge and
undertaking to provide fixed charges over major petroleum and natural
gas reserves in certain circumstances. A standby fee is charged of
between 0.50% and 0.875% on the undrawn portion of the credit
facilities, depending on the Company's debt to cash flow ratio.
The revolving period for the revolving term credit facility will end on
June 25, 2013, unless extended for a further 364 day period. Should
the facility not be extended it will convert to a non-revolving term
facility with the full amount outstanding due 366 days after the last
day of the revolving period of June 25, 2013. The borrowing base will
be subject to re-determination on May 31 and November 30 in each year
prior to maturity, with the next semi-annual redetermination occurring
on November 30, 2012.
As at September 30, 2012, approximately $95.4 million or 48% of unused
and available bank credit under its credit facilities was available to
fund Bellatrix's ongoing capital spending and operational requirements.
Bellatrix currently has commitments associated with its credit
facilities outlined above and the commitments outlined under the
"Commitments" section. Bellatrix continually monitors its capital
spending program in light of the recent volatility with respect to
commodity prices and Canadian dollar exchange rates with the aim of
ensuring the Company will be able to meet future anticipated
obligations incurred from normal ongoing operations with funds flow
from operations and draws on Bellatrix's credit facility, as
necessary. Bellatrix has the ability to fund its 2012 capital program
of $140 to $150 million by utilizing cash flow, and to the extent
necessary, bank indebtedness.
As at October 31, 2012, Bellatrix had outstanding a total of 9,367,118
options exercisable at an average exercise price of $3.40 per share,
$55.0 million principal amount of 4.75% Debentures convertible into
common shares (at a conversion price of $5.60 per share) and
107,699,107 common shares.
Commitments
As at September 30, 2012, Bellatrix committed to drill 3 gross (1.5 net)
wells pursuant to farm-in agreements. Bellatrix expects to satisfy
these drilling commitments at an estimated cost of approximately $6.3
million. In addition, on February 1, 2011, Bellatrix entered into a
joint venture agreement which includes a minimum commitment for the
Company to drill 3 gross (3.0 net) wells per year from 2011 to 2015 for
a total estimated cost of approximately $52.5 million. As at September
30, 2012, 10 wells remained to be drilled under this commitment for a
total estimated cost of $35.0 million. On August 4, 2011, Bellatrix
entered into a joint venture agreement which includes a minimum
commitment for the Company to drill between 5 and 10 gross (net) wells
per year from 2011 to 2016 for a total of 40 gross (net) wells at an
estimated cost of approximately $140.0 million, with the first five
wells requiring completion by December of 2012. As at September 30,
2012, 34 wells remained to be drilled under this commitment for a total
estimated cost of $119.0 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liability ($000s)
|
|
|
|
|
|
|
|
|
< 1 Year
|
|
|
|
1-2 Years
|
|
|
|
2-5 Years
|
|
|
|
Thereafter
|
Accounts payable and accrued liabilities (1) |
|
|
|
|
|
$
|
|
|
52,593
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
Commodity contract liability
|
|
|
|
|
|
|
|
|
1,867
|
|
|
|
692
|
|
|
|
-
|
|
|
|
-
|
Bank debt - principal (2) |
|
|
|
|
|
|
|
|
-
|
|
|
|
104,642
|
|
|
|
-
|
|
|
|
-
|
Convertible debentures - principal
|
|
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
55,000
|
|
|
|
-
|
Convertible debentures - interest (3) |
|
|
|
|
|
|
|
|
2,613
|
|
|
|
2,613
|
|
|
|
1,517
|
|
|
|
-
|
Decommissioning liabilities (4) |
|
|
|
|
|
|
|
|
-
|
|
|
|
8,385
|
|
|
|
4,773
|
|
|
|
29,626
|
Finance lease obligation
|
|
|
|
|
|
|
|
|
507
|
|
|
|
533
|
|
|
|
1,615
|
|
|
|
2,098
|
Total
|
|
|
|
|
|
$
|
|
|
57,580
|
|
|
$
|
116,865
|
|
|
$
|
62,905
|
|
|
$
|
31,724
|
(1)
|
Includes $1.1 million of accrued coupon interest payable in relation to
the 4.75% Debentures and $0.1 million
of accrued interest payable in relation to the credit facilities is
included in Accounts Payable and Accrued Liabilities.
|
(2) |
Bank debt is based on a revolving term which is reviewed annually and
converts to a 366 day non-revolving
facility if not renewed. Interest due on the bank credit facility is
calculated based upon floating rates.
|
(3) |
The 4.75% Debentures outstanding at September 30, 2012 bear interest at
a coupon rate of 4.75%, which
currently requires total annual interest payments of $2.6 million.
|
(4) |
Amounts represent the inflated, undiscounted future abandonment and
reclamation expenditures anticipated
to be incurred over the life of the Company's properties (between 2013
and 2053).
|
Off-Balance Sheet Arrangements
The Company has certain fixed term lease agreements, including primarily
office space leases, which were entered into in the normal course of
operations. All leases have been treated as operating leases whereby
the lease payments are included in operating expenses or G&A expenses
depending on the nature of the lease. The lease agreements do not
currently provide for early termination. No asset or liability value
has been assigned to these leases in the balance sheet as of September
30, 2012.
Business Prospects and 2012 Year Outlook
Bellatrix continues to develop its core assets and conduct exploration
programs utilizing its large inventory of geological prospects. As at
September 30, 2012, Bellatrix has approximately 197,428 net undeveloped
acres and including all opportunities has in excess of 1,525 net
exploration drilling opportunities identified. The Company continues
to focus on adding Cardium and Notikewin prospective lands. As at
September 30, 2012, Bellatrix controls 44 gross (43 net) contiguous
sections of Duvernay rights.
For the remainder of 2012, Bellatrix will continue to be active in
drilling its two core resource plays, the Cardium oil and Notikewin
condensate rich gas, utilizing horizontal drilling multi fracturing
technology. The Company's 2012 capital expenditure budget is between
$140 to $150 million. Based on the timing of proposed expenditures,
downtime for anticipated plant turnarounds, resolution of
infrastructure constraints and normal production declines, execution of
the 2012 budget is anticipated to provide average daily production of
approximately 16,500 to 17,000 boe/d. The Company is maintaining its
previously announced 2012 exit rate guidance of approximately 19,000
boe/d to 19,500 boe/d.
For the fourth quarter of 2012 the Company expects to drill an estimated
6 gross (4.85 net) Cardium oil wells, which includes a second
long-reach Cardium horizontal well (programmed to drill to a total
depth of 5,511m including a horizontal length of 3,048m) in the Brazeau
area. With reductions in industry activity levels, Bellatrix, through
negotiation, has been able to reduce its cost base per well by 10%, and
expects to carry these savings through the winter of 2012/13. The
Company is also moving to pad drilling wherever plausible in its
continuing effort to bring down the capital cost per well, improving
its already industry leading F&D costs and recycle ratios.
An initial capital budget of $180 million has been set for fiscal
2013. The capital budget is expected to be funded from a combination
of cash flows and bank indebtedness. Based on the timing of proposed
expenditures, downtime for anticipated plant turnarounds, resolution of
infrastructure constraints, and normal production declines, execution
of the 2013 budget is anticipated to provide 2013 average daily
production of approximately 20,000 boe/d and an exit rate of
approximately 21,500 boe/d to 22,500 boe/d.
Business Risks and Uncertainties
The reader is advised that Bellatrix continues to be subject to various
types of business risks and uncertainties as described in the Company's
Management Discussion and Analysis for the year ended December 31,
2011, and the Company's Annual Information Form for the year ended
December 31, 2011.
Critical Accounting Estimates
The reader is advised that the critical accounting estimates, policies,
and practices described in the Company's Management Discussion and
Analysis for the year ended December 31, 2011 continue to be critical
in determining Bellatrix's unaudited financial results as of September
30, 2012. There were no changes in accounting policies during the nine
months ended September 30, 2012.
A summary of future accounting pronouncements is found in the Company's
Management Discussion and Analysis for the year ended December 31,
2011, available at www.sedar.com.
Legal, Environmental Remediation and Other Contingent Matters
The Company is involved in various claims and litigation arising in the
normal course of business. While the outcome of these matters is
uncertain and there can be no assurance that such matters will be
resolved in the Company's favor, the Company does not currently believe
that the outcome of adverse decisions in any pending or threatened
proceeding related to these and other matters or any amount which it
may be required to pay by reason thereof would have a material adverse
impact on its financial position or results of operations.
The Company reviews legal, environmental remediation and other
contingent matters to both determine whether a loss is probable based
on judgment and interpretation of laws and regulations and determine
that the loss can reasonably be estimated. When the loss is
determined, it is charged to earnings. The Company's management
monitor known and potential contingent matters and make appropriate
provisions by charges to earnings when warranted by the circumstances.
Controls and Procedures
Disclosure Controls and Procedures
The Company's Chief Executive Officer and Chief Financial Officer have
designed, or caused to be designed under their supervision, disclosure
controls and procedures to provide reasonable assurance that: (i)
material information relating to the Company is made known to the
Company's Chief Executive Officer and Chief Financial Officer by
others, particularly during the period in which the annual and interim
filings are being prepared; and (ii) information required to be
disclosed by the Company in its annual filings, interim filings or
other reports filed or submitted by it under securities legislation is
recorded, processed, summarized and reported within the time period
specified in securities legislation.
Internal Control over Financial Reporting
The Company's Chief Executive Officer and Chief Financial Officer have
designed, or caused to be designed under their supervision, internal
control over financial reporting to provide reasonable assurance
regarding the reliability of the Company's financial reporting and the
preparation of financial statements for external purposes in accordance
with GAAP.
The Company is required to disclose herein any change in the Company's
internal control over financial reporting that occurred during the
period beginning on July 1, 2012 and ended on September 30, 2012 that
has materially affected, or is reasonably likely to materially affect,
the Company's internal control over financial reporting. No material
changes in the Company's internal control over financial reporting were
identified during such period that has materially affected, or are
reasonably likely to materially affect, the Company's internal control
over financial reporting.
It should be noted that a control system, including the Company's
disclosure and internal controls and procedures, no matter how well
conceived, can provide only reasonable, but not absolute, assurance
that the objectives of the control system will be met and it should not
be expected that the disclosure and internal controls and procedures
will prevent all errors or fraud.
Sensitivity Analysis
The table below shows sensitivities to funds flow from operations as a
result of product price, exchange rate, and interest rate changes.
This is based on actual average prices received for the third quarter
of 2012 and average production volumes of 15,503 boe/d during that
period, as well as the same level of debt outstanding at September 30,
2012. Diluted weighted average shares are based upon the third quarter
of 2012. These sensitivities are approximations only, and not
necessarily valid under other significantly different production levels
or product mixes. Commodity price risk management activities can
significantly affect these sensitivities. Changes in any of these
parameters will affect funds flow as shown in the table below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds Flow from Operations (1) |
|
|
|
|
Funds Flow from Operations (1) |
|
|
|
|
|
|
(annualized)
|
|
|
|
|
Per Diluted Share
|
Sensitivity Analysis
|
|
|
|
|
|
($000s)
|
|
|
|
|
($)
|
Change of US $1/bbl WTI
|
|
|
|
|
|
1,400
|
|
|
|
|
0.01
|
Change of $0.10/ mcf
|
|
|
|
|
|
2,100
|
|
|
|
|
0.02
|
Change of US $0.01 CDN/ US exchange rate
|
|
|
|
|
|
1,000
|
|
|
|
|
0.01
|
Change in prime of 1%
|
|
|
|
|
|
1,000
|
|
|
|
|
0.01
|
(1)
|
The term "funds flow from operations" should not be considered an
alternative to, or more meaningful than cash flow from operating activities as determined in accordance with GAAP as an
indicator of the Company's performance. Therefore reference to diluted funds flow from operations or funds flow
from operations per share may not be comparable with the calculation of similar measures for other entities. Management
uses funds flow from operations to analyze operating performance and leverage and considers funds flow from
operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future
capital investments and to repay debt. The reconciliation between cash flow from operating activities and funds
flow from operations can be found elsewhere herein. Funds flow from operations per share is calculated using the weighted
average number of common shares for the period.
|
Selected Quarterly Consolidated Information
The following table sets forth selected consolidated financial
information of the Company for the first, second and third quarters in
2012, and for the quarters in 2011 and 2010. The adoption date of IFRS
of January 1, 2011 required restatement for comparative purposes, of
the Company's opening balance sheet as at January 1, 2010, all interim
quarterly periods in 2010 and for its year ended December 31, 2010.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2012 - Quarter ended (unaudited)
($000s, except per share amounts)
|
|
|
|
|
|
March 31
|
|
|
|
June 30
|
|
|
|
Sept. 30
|
|
|
|
|
Revenues before royalties and risk management
|
|
|
|
|
|
58,191
|
|
|
|
50,714
|
|
|
|
48,126
|
|
|
|
|
Cash flow from operating activities
|
|
|
|
|
|
24,056
|
|
|
|
28,458
|
|
|
|
24,807
|
|
|
|
|
Cash flow from operating activities per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.22
|
|
|
|
$0.24
|
|
|
|
$0.23
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
$0.21
|
|
|
|
$0.22
|
|
|
|
$0.22
|
|
|
|
|
Funds flow from operations (1) |
|
|
|
|
|
29,194
|
|
|
|
25,366
|
|
|
|
26,613
|
|
|
|
|
Funds flow from operations per share (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.27
|
|
|
|
$0.24
|
|
|
|
$0.25
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
$0.25
|
|
|
|
$0.22
|
|
|
|
$0.23
|
|
|
|
|
Net profit (loss)
|
|
|
|
|
|
9,172
|
|
|
|
9,963
|
|
|
|
(615)
|
|
|
|
|
Net profit (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.09
|
|
|
|
$0.09
|
|
|
|
($0.01)
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
$0.08
|
|
|
|
$0.09
|
|
|
|
($0.01)
|
|
|
|
|
Net capital expenditures (cash)
|
|
|
|
|
|
73,831
|
|
|
|
16,284
|
|
|
|
35,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2011 - Quarter ended (unaudited)
($000s, except per share amounts)
|
|
|
|
|
|
March 31
|
|
|
|
June 30
|
|
|
|
Sept. 30
|
|
|
|
Dec. 31
|
Revenues before royalties and risk management
|
|
|
|
|
|
40,535
|
|
|
|
53,444
|
|
|
|
49,145
|
|
|
|
59,194
|
Cash flow from operating activities
|
|
|
|
|
|
15,718
|
|
|
|
23,825
|
|
|
|
28,023
|
|
|
|
30,626
|
Cash flow from operating activities per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.16
|
|
|
|
$0.23
|
|
|
|
$0.26
|
|
|
|
$0.28
|
|
Diluted
|
|
|
|
|
|
$0.15
|
|
|
|
$0.22
|
|
|
|
$0.24
|
|
|
|
$0.26
|
Funds flow from operations (1) |
|
|
|
|
|
17,027
|
|
|
|
23,126
|
|
|
|
23,964
|
|
|
|
30,120
|
Funds flow from operations per share (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.17
|
|
|
|
$0.22
|
|
|
|
$0.22
|
|
|
|
$0.28
|
|
Diluted
|
|
|
|
|
|
$0.16
|
|
|
|
$0.21
|
|
|
|
$0.21
|
|
|
|
$0.26
|
Net profit (loss)
|
|
|
|
|
|
(5,487)
|
|
|
|
12,315
|
|
|
|
820
|
|
|
|
(13,597)
|
Net profit (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$(0.06)
|
|
|
|
$0.12
|
|
|
|
$0.01
|
|
|
|
$(0.13)
|
|
Diluted
|
|
|
|
|
|
$(0.06)
|
|
|
|
$0.11
|
|
|
|
$0.01
|
|
|
|
$(0.13)
|
Net capital expenditures (cash)
|
|
|
|
|
|
59,247
|
|
|
|
28,784
|
|
|
|
40,087
|
|
|
|
47,240
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010 - Quarter ended (unaudited)
($000s, except per share amounts)
|
|
|
|
|
|
March 31
|
|
|
|
June 30
|
|
|
|
Sept. 30
|
|
|
|
Dec. 31
|
Revenues before royalties and risk management
|
|
|
|
|
|
26,929
|
|
|
|
25,574
|
|
|
|
27,344
|
|
|
|
37,826
|
Cash flow from operating activities
|
|
|
|
|
|
13,456
|
|
|
|
6,065
|
|
|
|
13,466
|
|
|
|
11,285
|
Cash flow from operating activities per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.15
|
|
|
|
$0.07
|
|
|
|
$0.14
|
|
|
|
$0.12
|
|
Diluted
|
|
|
|
|
|
$0.15
|
|
|
|
$0.07
|
|
|
|
$0.14
|
|
|
|
$0.11
|
Funds flow from operations (1) |
|
|
|
|
|
10,198
|
|
|
|
10,610
|
|
|
|
16,342
|
|
|
|
15,892
|
Funds flow from operations per share (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.12
|
|
|
|
$0.11
|
|
|
|
$0.17
|
|
|
|
$0.16
|
|
Diluted
|
|
|
|
|
|
$0.11
|
|
|
|
$0.11
|
|
|
|
$0.17
|
|
|
|
$0.15
|
Net profit (loss)
|
|
|
|
|
|
3,969
|
|
|
|
(6,351)
|
|
|
|
(2,546)
|
|
|
|
(57)
|
Net profit (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$0.04
|
|
|
|
$(0.07)
|
|
|
|
$(0.03)
|
|
|
|
$(0.00)
|
|
Diluted
|
|
|
|
|
|
$0.04
|
|
|
|
$(0.07)
|
|
|
|
$(0.03)
|
|
|
|
$(0.00)
|
Net capital expenditures (cash)
|
|
|
|
|
|
18,393
|
|
|
|
17,656
|
|
|
|
30,416
|
|
|
|
25,716
|
(1) |
Refer to "Non-GAAP Measures" in respect of the term "funds flow from
operations" and "funds flow from operations per share".
|
|
|
BELLATRIX EXPLORATION LTD.
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS
As at September 30, 2012 and December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited, expressed in Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
|
2012
|
|
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable (note 12)
|
|
$
|
|
|
36,212
|
|
|
$
|
|
|
45,322
|
Deposits and prepaid expenses
|
|
|
|
|
5,073
|
|
|
|
|
|
3,626
|
Commodity contract asset (note 12)
|
|
|
|
|
1,420
|
|
|
|
|
|
2,979
|
|
|
|
|
|
42,705
|
|
|
|
|
|
51,927
|
Exploration and evaluation assets (note 3)
|
|
|
|
|
29,162
|
|
|
|
|
|
33,089
|
Property, plant and equipment (note 4)
|
|
|
|
|
551,616
|
|
|
|
|
|
484,301
|
Deferred taxes (note 8)
|
|
|
|
|
4,352
|
|
|
|
|
|
11,105
|
Total assets
|
|
$
|
|
|
627,835
|
|
|
$
|
|
|
580,422
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
|
|
52,593
|
|
|
$
|
|
|
62,421
|
Current portion of finance lease obligation
|
|
|
|
|
507
|
|
|
|
|
|
490
|
Commodity contract liability (note 12)
|
|
|
|
|
1,867
|
|
|
|
|
|
10,667
|
|
|
|
|
|
54,967
|
|
|
|
|
|
73,578
|
|
|
|
|
|
|
|
|
|
|
|
|
Commodity contract liability (note 12)
|
|
|
|
|
692
|
|
|
|
|
|
2,944
|
Long-term debt (note 5)
|
|
|
|
|
104,642
|
|
|
|
|
|
56,701
|
Convertible debentures
|
|
|
|
|
50,269
|
|
|
|
|
|
49,076
|
Finance lease obligation
|
|
|
|
|
4,246
|
|
|
|
|
|
4,627
|
Decommissioning liabilities
|
|
|
|
|
42,784
|
|
|
|
|
|
45,091
|
Total liabilities
|
|
|
|
|
257,600
|
|
|
|
|
|
232,017
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' capital
|
|
|
|
|
370,664
|
|
|
|
|
|
370,048
|
Equity component of convertible debentures
|
|
|
|
|
4,378
|
|
|
|
|
|
4,378
|
Contributed surplus
|
|
|
|
|
36,576
|
|
|
|
|
|
33,882
|
Deficit
|
|
|
|
|
(41,383)
|
|
|
|
|
|
(59,903)
|
Total shareholders' equity
|
|
|
|
|
370,235
|
|
|
|
|
|
348,405
|
Total liabilities and shareholders' equity
|
|
$
|
|
|
627,835
|
|
|
$
|
|
|
580,422
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS (note 11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the condensed consolidated financial
statements.
|
|
BELLATRIX EXPLORATION LTD.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
For the three months and nine months ended September 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited, expressed in Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30,
|
|
|
Nine months ended September 30,
|
($000s)
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum and natural gas sales
|
|
|
|
|
$
|
47,608
|
|
|
$
|
48,814
|
|
|
$
|
155,567
|
|
|
$
|
141,760
|
Other income
|
|
|
|
|
|
518
|
|
|
|
331
|
|
|
|
1,464
|
|
|
|
1,364
|
Royalties
|
|
|
|
|
|
(8,879)
|
|
|
|
(8,586)
|
|
|
|
(26,918)
|
|
|
|
(25,922)
|
Total revenues
|
|
|
|
|
|
39,247
|
|
|
|
40,559
|
|
|
|
130,113
|
|
|
|
117,202
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized gain on commodity contracts
|
|
|
|
|
|
5,472
|
|
|
|
2,392
|
|
|
|
8,453
|
|
|
|
75
|
Unrealized gain (loss) on commodity contracts
|
|
|
|
|
|
(6,763)
|
|
|
|
8,556
|
|
|
|
9,493
|
|
|
|
10,776
|
|
|
|
|
|
|
37,956
|
|
|
|
51,507
|
|
|
|
148,059
|
|
|
|
128,053
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
|
|
|
|
|
|
11,360
|
|
|
|
12,748
|
|
|
|
37,938
|
|
|
|
36,226
|
Transportation
|
|
|
|
|
|
1,282
|
|
|
|
1,462
|
|
|
|
3,760
|
|
|
|
4,138
|
General and administrative
|
|
|
|
|
|
3,397
|
|
|
|
3,423
|
|
|
|
9,882
|
|
|
|
8,590
|
Share-based compensation (note 6)
|
|
|
|
|
|
945
|
|
|
|
568
|
|
|
|
2,505
|
|
|
|
2,083
|
Depletion and depreciation (note 4)
|
|
|
|
|
|
17,953
|
|
|
|
15,815
|
|
|
|
57,125
|
|
|
|
45,764
|
Loss (gain) on property dispositions
|
|
|
|
|
|
1,035
|
|
|
|
(1,531)
|
|
|
|
4,063
|
|
|
|
(1,750)
|
Impairment loss on property, plant and equipment
|
|
|
|
|
|
-
|
|
|
|
14,551
|
|
|
|
-
|
|
|
|
14,551
|
|
|
|
|
|
|
35,972
|
|
|
|
47,036
|
|
|
|
115,273
|
|
|
|
109,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET PROFIT BEFORE FINANCE AND TAXES
|
|
|
|
|
|
1,984
|
|
|
|
4,471
|
|
|
|
32,786
|
|
|
|
18,451
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance expenses (note 9)
|
|
|
|
|
|
2,631
|
|
|
|
1,903
|
|
|
|
7,513
|
|
|
|
6,009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET PROFIT (LOSS) BEFORE TAXES
|
|
|
|
|
|
(647)
|
|
|
|
2,568
|
|
|
|
25,273
|
|
|
|
12,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TAXES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax expense (recovery) (note 8)
|
|
|
|
|
|
(32)
|
|
|
|
1,748
|
|
|
|
6,753
|
|
|
|
4,794
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET PROFIT (LOSS) AND COMPREHENSIVE INCOME
|
|
|
|
|
|
(615)
|
|
|
|
820
|
|
|
|
18,520
|
|
|
|
7,648
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit (loss) per share (note 10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
($0.01)
|
|
|
|
$0.01
|
|
|
|
$0.17
|
|
|
|
$0.07
|
Diluted
|
|
|
|
|
|
($0.01)
|
|
|
|
$0.01
|
|
|
|
$0.17
|
|
|
|
$0.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to the condensed consolidated financial
statements.
|
|
|
BELLATRIX EXPLORATION LTD.
|
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
|
For the nine months ended September 30,
|
(unaudited, expressed in Canadian dollars)
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' CAPITAL
|
|
|
|
|
|
|
|
|
|
Common shares
|
|
|
|
|
|
|
|
|
|
|
Balance, beginning of period
|
|
|
$
|
370,048
|
|
|
$
|
316,779
|
|
|
Issued for cash, net of transaction costs
|
|
|
|
-
|
|
|
|
52,734
|
|
|
Issued on exercise of share options
|
|
|
|
429
|
|
|
|
362
|
|
|
Contributed surplus transferred on exercised options
|
|
|
|
187
|
|
|
|
147
|
|
|
Balance, end of period
|
|
|
|
370,664
|
|
|
|
370,022
|
|
|
|
|
|
|
|
|
|
EQUITY COMPONENT OF CONVERTIBLE DEBENTURES
|
|
|
|
|
|
|
|
|
|
|
Balance, beginning and end of period
|
|
|
|
4,378
|
|
|
|
4,378
|
|
|
|
|
|
|
|
|
|
CONTRIBUTED SURPLUS (note 6)
|
|
|
|
|
|
|
|
|
|
|
Balance, beginning of period
|
|
|
|
33,882
|
|
|
|
30,489
|
|
|
Share-based compensation expense
|
|
|
|
3,053
|
|
|
|
2,473
|
|
|
Adjustment of share-based compensation expense for forfeitures of
unvested share options
|
|
|
|
(172)
|
|
|
|
(63)
|
|
|
Transfer to share capital for exercised options
|
|
|
|
(187)
|
|
|
|
(147)
|
|
|
Balance, end of period
|
|
|
|
36,576
|
|
|
|
32,752
|
|
|
|
|
|
|
|
|
|
DEFICIT
|
|
|
|
|
|
|
|
|
|
|
Balance, beginning of period
|
|
|
|
(59,903)
|
|
|
|
(53,954)
|
|
|
Net profit
|
|
|
|
18,520
|
|
|
|
7,648
|
|
|
Balance, end of period
|
|
|
|
(41,383)
|
|
|
|
(46,306)
|
|
|
|
|
|
|
|
|
|
TOTAL SHAREHOLDERS' EQUITY
|
|
|
$
|
370,235
|
|
|
$
|
360,846
|
See accompanying notes to the condensed consolidated financial
statements.
|
|
BELLATRIX EXPLORATION LTD.
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
|
For the three and nine months ended September 30,
|
(unaudited, expressed in Canadian dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30,
|
|
|
|
Nine months ended September 30,
|
($000s)
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOW FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit (loss)
|
|
$
|
(615)
|
|
|
$
|
820
|
|
|
$
|
18,520
|
|
|
$
|
7,648
|
Adjustments for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depletion and depreciation
|
|
|
17,953
|
|
|
|
15,815
|
|
|
|
57,125
|
|
|
|
45,764
|
|
|
Finance expenses (note 9)
|
|
|
564
|
|
|
|
549
|
|
|
|
1,700
|
|
|
|
1,803
|
|
|
Share-based compensation (note 6)
|
|
|
945
|
|
|
|
568
|
|
|
|
2,505
|
|
|
|
2,083
|
|
|
Unrealized (gain) loss on commodity contracts
|
|
|
6,763
|
|
|
|
(8,556)
|
|
|
|
(9,493)
|
|
|
|
(10,776)
|
|
|
Loss (gain) on property dispositions
|
|
|
1,035
|
|
|
|
(1,531)
|
|
|
|
4,063
|
|
|
|
(1,750)
|
|
|
Impairment loss on property, plant and equipment
|
|
|
-
|
|
|
|
14,551
|
|
|
|
-
|
|
|
|
14,551
|
|
|
Deferred tax expense (recovery) (note 8)
|
|
|
(32)
|
|
|
|
1,748
|
|
|
|
6,753
|
|
|
|
4,794
|
|
|
Decommissioning costs incurred
|
|
|
(196)
|
|
|
|
87
|
|
|
|
(559)
|
|
|
|
(383)
|
|
|
Change in non-cash working capital (note 7)
|
|
|
(1,610)
|
|
|
|
3,972
|
|
|
|
(3,293)
|
|
|
|
3,832
|
|
|
|
24,807
|
|
|
|
28,023
|
|
|
|
77,321
|
|
|
|
67,566
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOW FROM (USED IN) FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of share capital
|
|
|
193
|
|
|
|
3
|
|
|
|
429
|
|
|
|
55,365
|
|
|
Issue costs on share capital
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,088)
|
|
|
Advances from loans and borrowings
|
|
|
96,074
|
|
|
|
57,476
|
|
|
|
360,849
|
|
|
|
270,607
|
|
|
Repayment of loans and borrowings
|
|
|
(105,707)
|
|
|
|
(64,750)
|
|
|
|
(312,908)
|
|
|
|
(274,400)
|
|
|
Obligations under finance lease
|
|
|
(126)
|
|
|
|
(37)
|
|
|
|
(364)
|
|
|
|
(108)
|
|
|
|
(9,566)
|
|
|
|
(7,308)
|
|
|
|
48,006
|
|
|
|
48,376
|
|
|
Change in non-cash working capital (note 7)
|
|
|
(1,086)
|
|
|
|
546
|
|
|
|
(1,965)
|
|
|
|
639
|
|
|
|
(10,652)
|
|
|
|
(6,762)
|
|
|
|
46,041
|
|
|
|
49,015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOW FROM (USED IN) INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenditure on exploration and evaluation assets
|
|
|
(2,012)
|
|
|
|
(5,160)
|
|
|
|
(5,248)
|
|
|
|
(15,324)
|
|
|
Additions to property, plant and equipment
|
|
|
(37,828)
|
|
|
|
(39,067)
|
|
|
|
(127,052)
|
|
|
|
(116,975)
|
|
|
Proceeds on sale of property, plant and equipment
|
|
|
4,325
|
|
|
|
4,140
|
|
|
|
6,670
|
|
|
|
4,181
|
|
|
|
(35,515)
|
|
|
|
(40,087)
|
|
|
|
(125,630)
|
|
|
|
(128,118)
|
|
|
Change in non-cash working capital (note 7)
|
|
|
21,360
|
|
|
|
18,826
|
|
|
|
2,268
|
|
|
|
11,537
|
|
|
|
(14,155)
|
|
|
|
(21,261)
|
|
|
|
(123,362)
|
|
|
|
(116,581)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in cash
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, beginning of period
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, end of period
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
1,576
|
|
|
$
|
508
|
|
|
$
|
4,751
|
|
|
$
|
3,021
|
|
Taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
See accompanying notes to the condensed consolidated financial
statements.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited, expressed in Canadian dollars)
1. CORPORATE INFORMATION
Bellatrix Exploration Ltd. (the "Company" or "Bellatrix") is a growth
oriented, public exploration and production company. The Company
resulted from a reorganization (the "Reorganization) effective November
1, 2009 pursuant to a plan of arrangement (the "Arrangement")
involving, among others, True Energy Trust (the "Trust" or "True"),
Bellatrix Exploration Ltd. and securityholders of the Trust.
2. BASIS OF PREPARATION
a. Statement of compliance
These condensed consolidated financial statements ("interim financial
statements") were authorized by the Board of Directors on November 7,
2012. The Company prepared these interim financial statements in
accordance with IAS 34 Interim Financial Reporting. The interim
financial statements do not include all information and disclosures
normally provided in annual financial statements and should be read in
conjunction with the Company's 2011 audited annual financial
statements, available at www.sedar.com. The Company has prepared these interim financial statements using the
same accounting policies and critical accounting estimates applied in
the 2011 audited annual financial statements.
b. Basis of measurement
The condensed consolidated financial statements are presented in
Canadian dollars, the Company's functional currency, and have been
prepared on the historical cost basis except for derivative financial
instruments and liabilities for cash-settled share-based payment
arrangements measured at fair value. The condensed consolidated
financial statements have, in management's opinion, been properly
prepared using careful judgment and reasonable limits of materiality.
These condensed consolidated financial statements are prepared within
the framework of the same significant accounting policies, critical
judgments, accounting estimates, accounting policies and methods of
computation as the consolidated financial statements for the fiscal
year ended December 31, 2011. The condensed consolidated financial
statement note disclosures do not include all of those required by IFRS
applicable for annual financial statements. Accordingly, the condensed
consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto as at and for
the year ended December 31, 2011.
3. EXPLORATION AND EVALUATION ASSETS
($000s)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
|
|
|
|
|
|
|
|
Balance, December 31, 2010
|
|
|
|
|
$
|
|
18,535
|
Additions
|
|
|
|
|
|
|
16,839
|
Transfer to oil and natural gas properties
|
|
|
|
|
|
|
(1,817)
|
Disposals (1) |
|
|
|
|
|
|
(468)
|
Balance, December 31, 2011
|
|
|
|
|
|
|
33,089
|
Additions
|
|
|
|
|
|
|
5,248
|
Transfer to oil and natural gas properties
|
|
|
|
|
|
|
(7,446)
|
Disposals (1) |
|
|
|
|
|
|
(1,729)
|
Balance, September 30, 2012
|
|
|
|
|
$
|
|
29,162
|
(1) Disposals include swaps.
4. PROPERTY, PLANT AND EQUIPMENT
($000s)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil and natural gas properties
|
|
|
|
Office furniture and equipment
|
|
|
|
Total
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2010
|
|
|
$
|
484,600
|
|
|
$
|
2,236
|
|
|
$
|
486,836
|
Additions
|
|
|
|
173,595
|
|
|
|
267
|
|
|
|
173,862
|
Transfer from exploration and evaluation assets
|
|
|
|
1,817
|
|
|
|
-
|
|
|
|
1,817
|
Disposals (1) |
|
|
|
(2,697)
|
|
|
|
-
|
|
|
|
(2,697)
|
Balance, December 31, 2011
|
|
|
|
657,315
|
|
|
|
2,503
|
|
|
|
659,818
|
Additions
|
|
|
|
125,802
|
|
|
|
196
|
|
|
|
125,998
|
Transfer from exploration and evaluation assets
|
|
|
|
7,446
|
|
|
|
-
|
|
|
|
7,446
|
Disposals (1) |
|
|
|
(10,910)
|
|
|
|
-
|
|
|
|
(10,910)
|
Balance, September 30, 2012
|
|
|
$
|
779,653
|
|
|
$
|
2,699
|
|
|
$
|
782,352
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depletion, Depreciation and Impairment losses
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2010
|
|
|
$
|
86,482
|
|
|
$
|
774
|
|
|
$
|
87,256
|
Charge for time period
|
|
|
|
63,085
|
|
|
|
299
|
|
|
|
63,384
|
Impairment loss
|
|
|
|
28,039
|
|
|
|
194
|
|
|
|
28,233
|
Impairment reversal
|
|
|
|
(2,664)
|
|
|
|
-
|
|
|
|
(2,664)
|
Disposals (1) |
|
|
|
(692)
|
|
|
|
-
|
|
|
|
(692)
|
Balance, December 31, 2011
|
|
|
$
|
174,250
|
|
|
$
|
1,267
|
|
|
$
|
175,517
|
Charge for time period
|
|
|
|
56,933
|
|
|
|
192
|
|
|
|
57,125
|
Disposals (1) |
|
|
|
(1,906)
|
|
|
|
-
|
|
|
|
(1,906)
|
Balance, September 30, 2012
|
|
|
$
|
229,277
|
|
|
$
|
1,459
|
|
|
$
|
230,736
|
(1) Disposals include swaps.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carrying amounts
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2011
|
|
|
$
|
483,065
|
|
|
$
|
1,236
|
|
|
$
|
484,301
|
At September 30, 2012
|
|
|
$
|
550,376
|
|
|
$
|
1,240
|
|
|
$
|
551,616
|
Bellatrix has included $371.9 million (2011: $159.8 million) for future
development costs and excluded $34.8 million (2011: $34.9 million) for
estimated salvage from the depletion calculation for the three months
ended September 30, 2012.
For the nine month period ended September 30, 2012, the Company
capitalized $3.2 million (2011: $2.7 million) of general and
administrative expenses and $1.2 million (2011: $0.9 million) of
share-based compensation expense directly related to exploration and
development activities.
Bellatrix's credit facilities are secured against all of the assets of
the Corporation by a $400 million debenture containing a first ranking
floating charge and security interest. The Corporation has provided a
negative pledge and undertaking to provide fixed charges over major
petroleum and natural gas reserves in certain circumstances.
5. LONG-TERM DEBT
($000s)
|
|
|
|
September 30, 2012
|
|
|
|
December 31, 2011
|
Operating facility
|
|
|
|
$
|
3,642
|
|
|
|
$
|
5,701
|
Revolving term facility
|
|
|
|
|
101,000
|
|
|
|
|
51,000
|
Balance, end of period
|
|
|
|
$
|
104,642
|
|
|
|
$
|
56,701
|
As of September 30, 2012, the Company's credit facilities consist of a
$15 million demand operating facility provided by a Canadian bank and a
$185 million extendible revolving term credit facility provided by two
Canadian banks and a Canadian financial institution.
The revolving period for the revolving term credit facility will end on
June 25, 2013, unless extended for a further 364 - day period. Should
the facility not be extended it will convert to a non-revolving term
facility with the full amount outstanding due 366 days after the last
day of the revolving period of June 25, 2013. The borrowing base will
be subject to re-determination on May 31 and November 30 in each year
prior to maturity, with the next semi-annual redetermination occurring
on November 30, 2012.
As at September 30, 2012, the Company had outstanding letters of credit
totaling $0.8 million that reduce the amount otherwise available to be
drawn on the syndicated facility.
As at September 30, 2012 the Company had approximately $95.4 million, or
48% of unused and available bank credit under its credit facilities.
Bellatrix was fully compliant with all of its operating debt covenants.
6. SHARE-BASED COMPENSATION PLANS
a. Share Option Plan
During the nine month period ended September 30, 2012, Bellatrix granted
2,363,000 (2011: 2,324,000) share options and recorded share-based
compensation of $2.9 million related to its outstanding share options,
net of $0.2 million of forfeitures. $1.2 million of the share-based
compensation expense was capitalized to property, plant and equipment.
In addition, $0.8 million (note 6 b.) was expensed in relation to the
Director's Deferred Share Unit Plan, resulting in total net share-based
compensation of $2.5 million recognized as an expense for the first
nine months of 2012 (2011: $2.1 million).
The fair values of all share options granted are estimated on the date
of grant using the Black-Scholes option-pricing model. The weighted
average fair market value of share options granted during the three
month periods ended September 30, 2012 and 2011, and the weighted
average assumptions used in their determination are as noted below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
Inputs:
|
|
|
|
|
|
|
|
|
|
|
Share price
|
|
|
|
3.40
|
|
|
|
5.29
|
|
|
Exercise price
|
|
|
|
3.40
|
|
|
|
5.29
|
|
|
Risk free interest rate (%)
|
|
|
|
1.1
|
|
|
|
1.9
|
|
|
Option life (years)
|
|
|
|
2.8
|
|
|
|
3.7
|
|
|
Option volatility (%)
|
|
|
|
54
|
|
|
|
65
|
|
|
Results:
|
|
|
|
|
|
|
|
|
|
|
Weighted average fair value of each share option granted
|
|
|
|
1.23
|
|
|
|
2.55
|
Bellatrix calculates volatility based on historical share price.
Bellatrix incorporates an estimated forfeiture rate between 3% and 10%
(2011: 3% to 10%) for stock options that will not vest, and adjusts for
actual forfeitures as they occur.
The weighted average TSX share trading price for the three and nine
months ended September 30, 2012 was $3.54 (2011: $4.41), and $4.35
(2011: $5.19), respectively.
The following tables summarize information regarding Bellatrix's Share
Option Plan:
Share Options Continuity
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Exercise Price
|
|
|
|
Number
|
Balance, December 31, 2011
|
|
|
|
$
|
3.44
|
|
|
|
7,985,320
|
Granted
|
|
|
|
$
|
3.48
|
|
|
|
2,363,000
|
Exercised
|
|
|
|
$
|
2.15
|
|
|
|
(199,643)
|
Forfeited and cancelled
|
|
|
|
$
|
4.60
|
|
|
|
(649,670)
|
Balance, September 30, 2012
|
|
|
|
$
|
3.40
|
|
|
|
9,499,007
|
As of September 30, 2012, a total of 10,739,129 share options were
reserved, leaving an additional 1,240,122 available for future grants.
Share Options Outstanding, September 30, 2012
|
|
|
|
Outstanding
|
|
|
|
|
|
|
Exercisable
|
Exercise Price
|
|
|
At September 30, 2012
|
|
|
Weighted
Average
Exercise Price
|
|
|
Weighted
Average
Remaining
Contractual Life
|
|
|
At September 30, 20121
|
|
|
Exercise Price
|
$ 0.65 - $ 0.83
|
|
|
277,729
|
|
|
$ 0.69
|
|
|
1.5
|
|
|
277,729
|
|
|
$ 0.69
|
$ 0.84 - $ 1.50
|
|
|
832,279
|
|
|
$ 1.37
|
|
|
1.6
|
|
|
786,943
|
|
|
$ 1.38
|
$ 1.51 - $ 2.00
|
|
|
1,593,832
|
|
|
$ 1.88
|
|
|
1.5
|
|
|
1,529,493
|
|
|
$ 1.87
|
$ 2.01 - $ 3.94
|
|
|
4,268,501
|
|
|
$ 3.51
|
|
|
3.4
|
|
|
1,540,812
|
|
|
$ 3.55
|
$ 3.95 - $ 5.45
|
|
|
2,526,666
|
|
|
$ 5.13
|
|
|
3.8
|
|
|
751,976
|
|
|
$ 5.22
|
$ 0.65 - $ 5.45
|
|
|
9,499,007
|
|
|
$ 3.40
|
|
|
3.0
|
|
|
4,886,953
|
|
|
$ 2.77
|
b. Deferred Share Unit Plan
During the nine months ended September 30, 2012, the Company granted
246,225 Deferred Share Units ("DSUs") (2011: 156,934) and had 405,451
DSUs outstanding as at September 30, 2012. For the nine months ended
September 30, 2012, Bellatrix recorded approximately $0.8 million
(2011: $0.6 million) of share based compensation expense and had a
liability balance of $1.6 million relating to the Company's outstanding
DSUs.
7. SUPPLEMENTAL CASH FLOW INFORMATION
Change in Non-cash Working Capital
|
|
|
|
|
|
|
|
|
|
($000s)
|
|
|
|
Three months ended September 30,
|
|
|
|
Nine months ended September 30,
|
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
|
Changes in non-cash working capital items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
$
|
787
|
|
|
$
|
9,740
|
|
|
$
|
9,110
|
|
|
$
|
4,955
|
|
Deposits and prepaid expenses
|
|
|
|
677
|
|
|
|
753
|
|
|
|
(1,447)
|
|
|
|
667
|
|
Accounts payable and accrued liabilities
|
|
|
|
17,200
|
|
|
|
12,851
|
|
|
|
(10,653)
|
|
|
|
10,386
|
|
|
|
$
|
18,664
|
|
|
$
|
23,344
|
|
|
$
|
(2,990)
|
|
|
$
|
16,008
|
|
Changes related to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities
|
|
|
$
|
(1,610)
|
|
|
$
|
3,972
|
|
|
$
|
(3,293)
|
|
|
$
|
3,832
|
|
Financing activities
|
|
|
|
(1,086)
|
|
|
|
546
|
|
|
|
(1,965)
|
|
|
|
639
|
|
Investing activities
|
|
|
|
21,360
|
|
|
|
18,826
|
|
|
|
2,268
|
|
|
|
11,537
|
|
|
|
$
|
18,664
|
|
|
$
|
23,344
|
|
|
$
|
(2,990)
|
|
|
$
|
16,008
|
8. INCOME TAXES
Bellatrix is a corporation as defined under the Income Tax Act (Canada)
and is subject to Canadian federal and provincial taxes. Bellatrix is
subject to provincial taxes in Alberta, British Columbia and
Saskatchewan as the Company operates in those jurisdictions.
Deferred taxes reflect the tax effects of differences between the
carrying amounts of assets and liabilities for financial reporting
purposes and the amounts reported for tax purposes. As at September
30, 2012, Bellatrix has approximately $560 million in tax pools
available for deduction against future income. Included in this tax
basis are estimated non-capital loss carry forwards of approximately
$10 million that expire in years through 2027.
9. FINANCE INCOME AND EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30,
|
|
|
|
Nine months ended September 30,
|
($000s)
|
|
|
|
2012
|
|
|
|
2011
|
|
|
|
2012
|
|
|
|
2011
|
Finance expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on long-term debt
|
|
|
$
|
1,408
|
|
|
$
|
696
|
|
|
$
|
3,852
|
|
|
$
|
2,253
|
|
Interest on convertible debentures
|
|
|
|
659
|
|
|
|
658
|
|
|
|
1,961
|
|
|
|
1,953
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accretion on convertible debentures
|
|
|
|
409
|
|
|
|
376
|
|
|
|
1,193
|
|
|
|
1,093
|
|
Accretion on decommissioning liabilities
|
|
|
|
155
|
|
|
|
173
|
|
|
|
507
|
|
|
|
710
|
|
|
|
|
564
|
|
|
|
549
|
|
|
|
1,700
|
|
|
|
1,803
|
Finance expense
|
|
|
$
|
2,631
|
|
|
$
|
1,903
|
|
|
$
|
7,513
|
|
|
$
|
6,009
|
10. PER SHARE AMOUNTS
The calculation of basic earnings per share for the three and nine
months ended September 30, 2012 was based on a net loss of $0.6 million
(2011: net profit of $0.8 million) and net profit of $18.5 million
(2011: $7.6 million), respectively
|
|
|
Three months ended September 30,
|
|
|
Nine months ended September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
Basic common shares outstanding
|
|
|
107,606,884
|
|
|
107,391,298
|
|
|
107,606,884
|
|
|
107,391,298
|
Dilutive effect of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share options outstanding
|
|
|
9,499,007
|
|
|
7,830,931
|
|
|
9,499,007
|
|
|
7,830,931
|
|
Shares issuable for convertible debentures
|
|
|
9,821,429
|
|
|
9,821,429
|
|
|
9,821,429
|
|
|
9,821,429
|
Diluted common shares outstanding
|
|
|
126,927,320
|
|
|
125,043,658
|
|
|
126,927,320
|
|
|
125,043,658
|
Weighted average shares outstanding
|
|
|
107,527,718
|
|
|
107,391,070
|
|
|
107,479,907
|
|
|
102,664,721
|
Dilutive effect of share options and convertible debentures (1) |
|
|
-
|
|
|
2,001,690
|
|
|
1,631,585
|
|
|
2,450,285
|
Diluted weighted average shares outstanding
|
|
|
107,527,718
|
|
|
109,392,760
|
|
|
109,111,492
|
|
|
105,115,006
|
(1)
|
|
For the three month period ending September 30, 2012, a total of
9,499,007 (2011: 5,829,241) share options and 9,821,429 (2011:
9,821,429) common shares issuable pursuant to the conversion of the
convertible debentures were excluded from the calculation as they were
not dilutive.
|
|
|
For the nine month period ending September 30, 2012, a total of
7,867,422 (2011: 5,380,646) share options and 9,821,429 (2011:
9,821,429) common shares issuable pursuant to the conversion of the
convertible debentures were excluded from the calculation as they were
not dilutive.
|
11. COMMITMENTS
As at September 30, 2012, Bellatrix committed to drill 3 gross (1.5 net)
wells pursuant to farm-in agreements. Bellatrix expects to satisfy
these drilling commitments at an estimated cost of approximately $6.3
million. In addition, on February 1, 2011, Bellatrix entered into a
joint venture agreement which includes a minimum commitment for the
Company to drill 3 gross (3.0 net) wells per year from 2011 to 2015 for
a total estimated cost of approximately $52.5 million. As at
September 30, 2012, 10 wells remained to be drilled under this
commitment for a total estimated cost of $35.0 million. On August 4,
2011, Bellatrix entered into a joint venture agreement which includes a
minimum commitment for the Company to drill between 5 and 10 gross
(net) wells per year from 2011 to 2016 for a total of 40 gross (net)
wells at an estimated cost of approximately $140.0 million, with the
first five wells requiring completion by December of 2012. As at
September 30, 2012, 34 wells remained to be drilled under this
commitment for a total estimated cost of $119.0 million.
12. FINANCIAL RISK MANAGEMENT
a. Credit risk
As at September 30, 2012, accounts receivable was comprised of the
following:
|
Aging ($000s)
|
|
|
Not past due
(less than 90
days)
|
|
|
Past due (90
days or more)
|
|
|
|
Total
|
Joint venture and other trade accounts receivable
|
|
|
$
|
7,990
|
|
|
$
|
2,909
|
|
|
$
|
10,899
|
Amounts due from government agencies
|
|
|
|
250
|
|
|
|
729
|
|
|
|
979
|
Revenue and other accruals
|
|
|
|
20,285
|
|
|
|
2,297
|
|
|
|
22,582
|
Cash call receivables
|
|
|
|
-
|
|
|
|
65
|
|
|
|
65
|
Plant revenue allocation receivable
|
|
|
|
-
|
|
|
|
2,855
|
|
|
|
2,855
|
Less: Allowance for doubtful accounts
|
|
|
|
-
|
|
|
|
(1,168)
|
|
|
|
(1,168)
|
Total accounts receivable
|
|
|
|
28,525
|
|
|
|
7,687
|
|
|
|
36,212
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable due to same partners
|
|
|
|
-
|
|
|
|
(321)
|
|
|
|
(321)
|
Subsequent receipts to October 31, 2012
|
|
|
|
(15,764)
|
|
|
|
(194)
|
|
|
|
(15,958)
|
|
|
|
$
|
12,761
|
|
|
$
|
7,172
|
|
|
$
|
19,933
|
Amounts due from government agencies include GST and royalty
adjustments. Plant revenue allocation receivable includes amounts
under dispute over plant revenue allocations, net of expenses, from an
operator. The Company has commenced legal action for collection of
these amounts. Accounts payable due to same partners includes amounts
which may be available for offset against certain receivables.
Cash call receivables consist of advances paid to joint interest
partners for capital projects.
The carrying amount of accounts receivable and derivative assets
represents the maximum credit exposure.
b. Liquidity risk
The following are the contractual maturities of financial liabilities as
at September 30, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liability ($000s)
|
|
|
|
< 1 Year
|
|
|
|
1-2 Years
|
|
|
|
2-5 Years
|
|
|
|
Thereafter
|
Accounts payable and accrued liabilities (1) |
|
|
$
|
52,593
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
Commodity contract liability
|
|
|
|
1,867
|
|
|
|
692
|
|
|
|
-
|
|
|
|
-
|
Bank debt - principal (2) |
|
|
|
-
|
|
|
|
104,642
|
|
|
|
-
|
|
|
|
-
|
Convertible debentures - principal
|
|
|
|
-
|
|
|
|
-
|
|
|
|
55,000
|
|
|
|
-
|
Convertible debentures - interest (3) |
|
|
|
2,613
|
|
|
|
2,613
|
|
|
|
1,517
|
|
|
|
-
|
Decommissioning liabilities (4) |
|
|
|
-
|
|
|
|
8,385
|
|
|
|
4,773
|
|
|
|
29,626
|
Finance lease obligation
|
|
|
|
507
|
|
|
|
533
|
|
|
|
1,615
|
|
|
|
2,098
|
Total
|
|
|
$
|
57,580
|
|
|
$
|
116,865
|
|
|
$
|
62,905
|
|
|
$
|
31,724
|
(1) |
|
Includes $1.1 million of accrued coupon interest payable in relation to
the 4.75% Debentures and $0.1 million of accrued interest payable in
relation to the credit facilities is included in Accounts Payable and
Accrued Liabilities.
|
(2) |
|
Bank debt is based on a revolving term which is reviewed annually and
converts to a 366 day non-revolving facility if not renewed. Interest
due on the bank credit facility is calculated based upon floating
rates.
|
(3) |
|
The 4.75% Debentures outstanding at September 30, 2012 bear interest at
a coupon rate of 4.75%, which currently requires total annual interest
payments of $2.6 million.
|
(4) |
|
Amounts represent the inflated, undiscounted future abandonment and
reclamation expenditures anticipated to be incurred over the life of
the Company's properties (between 2013 and 2053).
|
c. Commodity price risk
The Company utilizes both financial derivatives and physical delivery
sales contracts to manage commodity price risks. All such transactions
are conducted in accordance with the commodity price risk management
policy that has been approved by the Board of Directors.
As at September 30, 2012, the Company has entered into commodity price
risk management arrangements as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Type
|
|
|
Period
|
|
|
Volume
|
|
|
|
Price Floor
|
|
|
|
Price Ceiling
|
|
|
Index
|
Crude oil fixed
|
|
|
January 1, 2012 to Dec. 31, 2012
|
|
|
1,000 bbl/d
|
|
|
$
|
90.00 CDN
|
|
|
$
|
90.00 CDN
|
|
|
WTI
|
Crude oil fixed
|
|
|
January 1, 2012 to Dec. 31, 2012
|
|
|
1,000 bbl/d
|
|
|
$
|
90.49 CDN
|
|
|
$
|
90.49 CDN
|
|
|
WTI
|
Crude oil fixed
|
|
|
January 1, 2012 to Dec. 31, 2012
|
|
|
1,000 bbl/d
|
|
|
$
|
96.40 CDN
|
|
|
$
|
96.40 CDN
|
|
|
WTI
|
Crude oil fixed
|
|
|
January 1, 2013 to Dec. 31, 2013
|
|
|
1,500 bbl/d
|
|
|
$
|
94.50 CDN
|
|
|
$
|
94.50 CDN
|
|
|
WTI
|
Crude oil call option
|
|
|
January 1, 2012 to Dec. 31, 2012
|
|
|
833 bbl/d
|
|
|
|
-
|
|
|
$
|
110.00 US
|
|
|
WTI
|
Crude oil call option
|
|
|
January 1, 2013 to Dec. 31, 2013
|
|
|
1,000 bbl/d
|
|
|
|
-
|
|
|
$
|
110.00 US
|
|
|
WTI
|
Crude oil call option
|
|
|
January 1, 2013 to Dec. 31, 2013
|
|
|
1,000 bbl/d
|
|
|
|
-
|
|
|
$
|
110.00 US
|
|
|
WTI
|
Crude oil call option
|
|
|
January 1, 2013 to Dec. 31, 2013
|
|
|
1,000 bbl/d
|
|
|
|
-
|
|
|
$
|
110.00 US
|
|
|
WTI
|
Natural gas fixed
|
|
|
April 1, 2012 to Oct. 31, 2012
|
|
|
10,000 GJ/d
|
|
|
$
|
4.10 CDN
|
|
|
$
|
4.10 CDN
|
|
|
AECO
|
Natural gas fixed
|
|
|
April 1, 2012 to Oct. 31, 2012
|
|
|
10,000 GJ/d
|
|
|
$
|
4.10 CDN
|
|
|
$
|
4.10 CDN
|
|
|
AECO
|
Natural gas fixed
|
|
|
April 1, 2012 to Oct. 31, 2012
|
|
|
10,000 GJ/d
|
|
|
$
|
4.11 CDN
|
|
|
$
|
4.11 CDN
|
|
|
AECO
|
Natural gas fixed
|
|
|
May 1, 2012 to Oct. 31, 2012
|
|
|
10,000 GJ/d
|
|
|
$
|
1.77 CDN
|
|
|
$
|
1.77 CDN
|
|
|
AECO
|
The Company's updated corporate presentation is available at www.bellatrixexploration.com.
Bellatrix Exploration Ltd. is a Western Canadian based growth oriented
oil and gas company engaged in the exploration for, and the
acquisition, development and production of oil and natural gas reserves
in the provinces of Alberta, British Columbia and Saskatchewan. Common
shares and convertible debentures of Bellatrix trade on the Toronto
Stock Exchange ("TSX") under the symbols BXE and BXE.DB.A,
respectively, and the common shares of Bellatrix trade on the NYSE MKT
under the symbol BXE.
PDF available at: http://stream1.newswire.ca/media/2012/11/08/20121108_C5037_DOC_EN_20288.pdf
SOURCE: Bellatrix Exploration Ltd.
Raymond G. Smith, P.Eng., President and CEO (403) 750-2420 or Edward J. Brown, CA, Vice President, Finance and CFO (403) 750-2655 or Brent A. Eshleman, P.Eng., Executive Vice President (403) 750-5566 or Troy Winsor, Investor Relations (800) 663-8072 Bellatrix Exploration Ltd. 2300, 530 - 8th Avenue SW Calgary, Alberta, Canada T2P 3S8 Phone: (403) 266-8670 Fax: (403) 264-8163 www.bellatrixexploration.com
Source: Canada Newswire
(November 8, 2012 - 2:05 AM EST)
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|