Mikaila Adams
OFGJ Associate Editor
Company hopes monetizing Permian assets will deleverage company
In an ongoing effort to right itself, Petroflow Energy Ltd. is making additional changes, including naming Kyle R. Miller to the position of CEO, transitioning the corporate headquarters to Denver, and selling its Permian Basin properties to reduce debt.
In moving the company’s home base to Denver, CO, the company is closing its Calgary office.
Another big change took place in mid-December when the company’s CFO, Duncan Moodie, resigned. Tucker Franciscus is currently serving as interim CFO.
In an effort to help balance the budget and decrease debt, the company recently sold its Texas Permian Basin properties consisting of 3,640 gross and net developed acres.
Petroflow had a 100% working interest in 14 producing oil wells on the Properties that produced about 65 boes (390 McfGEs) per day of production. The company will use the gross cash proceeds of $3.3 million to reduce its outstanding indebtedness under its amended and restated credit agreement.
“The Texas Properties were substantially developed and it was an appropriate time to monetize this asset. With the completion of the sale, we will be able to further concentrate our capital and attention on the continuation of our successful operations in the Hunton dewatering resource play” stated Sandy Andrew, president and COO.
“We are pleased we are able to take this first step to begin to deleverage the company and we appreciate that our banks continue to work with us during this period of challenging commodity markets,” he continued.
3Q09 results
The company blamed low commodity prices for some of the troubles reflected in its 3Q09 financial results. Funds from operations decreased by 123% in the third quarter of 2009 to negative $1.4 million from $6.0 million in the third quarter of 2008.
The company recorded a $0.30 net loss per share for the third quarter of 2009 compared to a net income of $0.41 per share in the same period of 2008. Net loss was $8.7 million for the third quarter of 2009, a decrease of 172% from a net income of $12.0 million for the same period in 2008.
The independent exploration and production company predominately engages in unconventional drilling in the Hunton Resource Play in Oklahoma, as well as conventional activity in Alberta, ON.