HOUSTON, March 9, 2016 /PRNewswire/ -- Glori Energy Inc. (NASDAQ: GLRI), an energy technology and oil production company focused on enhanced oil recovery using its proprietary AERO® System, today provided an update on its operations and other recent developments.
- Commenced Phase II of AERO deployment at Coke Field with nutrient injection.
- Implemented further cost saving measures through rationalization of field operations, personnel reductions, office consolidation and reduction in the size of the Board of Directors.
- Invited to submit Part II application to the DOE loan guarantee program focused on advanced fossil energy development.
- Data from successful California AERO project reported in Journal of Petroleum Technology.
Stuart Page, Chief Executive Officer of Glori Energy, said, "I am pleased to announce that we have now completed installation of phase II of our AERO implementation at our Coke oil field. Phase II incorporates the addition of two AERO injection wells to increase the proportion of the field that is impacted by AERO technology. We now have three injection wells running in total. Phase II implementation commenced after data from our Phase I limited trial demonstrated encouraging indication of AERO performance.
"Phase II implementation consists of two existing inactive, shut-in wells that were recompleted and used as nutrient injection wells. The wells are located on the periphery of the Coke Field and are designed to stimulate production from more of the field than was impacted by the first injector. Phase II AERO injection commenced on March 4."
Mr. Page continued, "To further enhance the Company's production profile and build a larger asset base, we continue to seek and evaluate additional oil field acquisition opportunities that would generate current cash flow and serve as suitable candidates for future AERO deployment. The rapid drop in oil prices has made it difficult to execute on our acquisition strategy due to potential sellers' reluctance to sell at depressed prices and the industry's reduced access to capital. We have retained Stephens Inc., a financial advisory firm with experience in the energy industry, as financial advisor and are actively exploring M&A alternatives with several potential partners, investors and asset sellers with the goal of bolstering our balance sheet and increasing shareholder value.
"Because market conditions remain challenging, we continue to carefully manage costs, reduce expenses and minimize capital spending. We have reduced personnel, consolidated office space and are reducing the size of our Board to better fit a company of our size. Effective March 7, two board members, Matthew Gibbs and James Musselman, have stepped down to reduce board costs and streamline board processes. We appreciate the significant contributions and support we have received from Matt and Jim and thank them for sharing their expertise and counsel. Total savings associated with these cost saving measures, including a 39% reduction in our professional and administrative staff implemented during the first quarter, are projected at approximately $2.2 million on an annual basis.
"Additionally, we have taken steps to reduce lease operating expenses and as part of our cost saving measures, we have shut in or reduced flow rates from certain high-cost and under-performing wells. This action was taken at the Coke Field before Phase II injection commenced in order to create a more stable production base line from which to judge future AERO performance. These cost saving actions should result in a net improvement in field profitability of approximately $720,000 on an annualized basis."
"Preliminary total fourth quarter 2015 average daily production(1) is expected to be 461 net BOE per day, down from 525 net BOE per day in the fourth quarter of 2014 and 483 net BOE per day in the third quarter of 2015, primarily due to shutting in producing wells to perform workovers at our Bonnie View field and equipment downtime at the Coke Field," Mr. Page concluded.
The Company also announced that it has applied to the United States Department of Energy's Loan Programs Office ("LPO") for a $150 million loan guarantee in connection with a project applying AERO to previously abandoned reservoirs in the U. S. (the "Project"). Based on LPO's evaluation of Part I of the Company's application, on March 1, 2016, LPO invited the Company to submit Part II of its application. In connection with the Company's preparation of Part II of its application, LPO noted that the Company should consider, among other matters, the following: "LPO appreciates the Company's work on Part I of the application and looks forward to receiving Part II of the application, but, cannot predict the ultimate outcome of the Company's application or whether a term sheet, conditional commitment, or loan guarantee eventually will be issued for the Project."
Finally, the Company announced that Glori's AERO technology and associated water treatment technology was featured in the February 2016 issue of the Journal of Petroleum Technology, a magazine of the Society of Petroleum Engineers, which showcased a successful project in California where production was shown to significantly increase over the duration of the project. Rigzone, a leading online energy resource, also recently featured Glori's AERO technology and its joint industry project with Canada's Alberta Innovates, which is funding the project to assess and test the potential of AERO technology to boost heavy oil production. Both articles can be found under the News section of Glori's website at www.glorienergy.com.
FOURTH QUARTER 2015 EARNINGS AND CONFERENCE CALL SCHEDULE
Glori plans to release its fourth quarter 2015 financial results on Wednesday, March 23, before the market opens. In conjunction with the news release, Glori has scheduled a conference call the same day at 10:00 a.m. Central Time (11:00 a.m. Eastern Time). Investors may participate either by phone or audio webcast. To participate, dial 1-877-407-0672 (toll free) or 1-412-902-0003 and ask for the Glori Energy call or access the audio webcast via the Investor Relations section of Glori's website at www.GloriEnergy.com. Please dial in at least 10 minutes prior to the scheduled start time. A telephonic replay will be available approximately three hours after the call through March 30. Participants may access the replay by dialing 1-877-660-6853 (toll free) or 1-201-612-7415 (international) and using the conference ID 13631831#.
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The Company is no longer an accelerated filer with the SEC and has not yet completed its audit of 2015 year-end financials.
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ABOUT GLORI ENERGY INC.
Glori Energy is a Houston-based energy technology and oil production company that deploys its proprietary AERO technology to increase the amount of oil that can be produced from conventional oil fields. Glori owns and operates oil fields onshore U.S. and additionally provides its technology as a service to E&P companies globally. Only one-third of all oil discovered in a typical reservoir is recoverable using conventional technologies; the rest remains trapped in the rock. Glori's proprietary AERO System recovers residual oil by stimulating a reservoir's native microorganisms to sustainably increase the ultimate recovery at a low cost. For more information, visit www.GloriEnergy.com.
FORWARD LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Any statements contained herein which are not statements of historical fact may be deemed to be forward-looking statements, including, without limitation, statements identified by or containing words like "believes," "expects," "anticipates," "intends," "estimates," "projects," "predicts," "potential," "target," "goal," "plans," "objective," "should," "could," "will," or similar expressions. All statements by us regarding our possible or assumed future results of our business, financial condition, liquidity, results of operations, models, including the ROF models, plans and objectives and similar matters are forward-looking statements. Glori gives no assurances that the assumptions upon which such forward-looking statements are based will prove correct. Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and assumptions (many of which are beyond our control), and are based on information currently available to us. Actual results may differ materially from those expressed herein due to many factors, including, without limitation: the risk that any projections, including models, earnings, revenues, expenses, margins, or any other financial expectations are not realized; oil production rates; the continued decline in oil prices and the sustained low oil price environment; the efficacy of changes in oil fields acquired or treated by us; competition and competitive factors in the markets in which Glori operates; the potential delisting of our common stock from NASDAQ; the expected cost of recovering oil using the AERO System, demand for Glori's AERO System and expectations regarding future projects; adaptability of the AERO System and development of additional capabilities that will expand the types of oil fields to which Glori can apply its technology; plans to acquire and develop additional oil fields and the availability of debt and equity financing to fund any such acquisitions; the percentage of the world's reservoirs that are suitable for the AERO System; Glori's ability to create positive cash flows; the advantages of the AERO System and our refinements thereto compared to other enhanced oil recovery methods; Glori's ability to develop and maintain positive relationships with its customers and prospective customers; and such other factors as are discussed in Item 1A "Risk Factors" and Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the 2014 fiscal year and our subsequent Quarterly Reports on Form 10-Q for 2015. Although Glori believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurances that such expectations will prove to be correct. These risks are more fully discussed in Glori's filings with the Securities and Exchange Commission. Glori undertakes no obligation to update any forward-looking statements contained herein to reflect events or circumstances, which arise after the date of this document except as required by law.
Glori Energy Contact
Victor M. Perez
Chief Financial Officer
713-237-8880
ir@glorienergy.com
Investor Relations Counsel
Lisa Elliott / Anne Pearson
Dennard-Lascar Associates
713-529-6600
lelliott@DennardLascar.com
apearson@DennardLascar.com
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SOURCE Glori Energy Inc.
