Vancouver, British Columbia, May 29, 2024 – Hemisphere Energy Corporation ("Hemisphere" or the "Company") provides its financial and operating results for the first quarter ended March 31, 2024, declares a quarterly dividend payment to shareholders, renews credit facility, and provides operations update.
Q1 2024 Highlights
- Produced a quarterly average of 3,133 boe/d (99% heavy oil), including significant downtime in January and early February due to extreme cold weather.
- Attained quarterly revenue of $21.0 million.
- Maintained low operating and transportation costs of $14.24/boe despite reduced quarterly production.
- Delivered an operating netback1 of $13.1 million, or $46.04/boe.
- Realized quarterly adjusted funds flow from operations ("AFF")1 of $10.1 million, or $35.38/boe.
- Achieved free funds flow1 of $4.4 million, or $0.04 per share.
- Executed a $5.6 million capital expenditure1 program, including drilling five horizontal wells (three producers, two injectors) in the Company’s new Marsden, Saskatchewan oil play.
- Received Enhanced Oil Recovery ("EOR") project approval from the Ministry of Energy and Resources for a pilot polymer flood in Marsden.
- Distributed $2.5 million, or $0.025 per share, in dividends to shareholders during the quarter.
- Purchased and cancelled 869,100 shares for $1.2 million under the Company’s Normal Course Issuer Bid ("NCIB").
- Exited the first quarter with positive working capital1 of $4.2 million, compared to $3.0 million at the end of March 2023.
(1) Operating netback, adjusted funds flow from operations (AFF), free funds flow, capital expenditure, and working capital are non-IFRS measures, or when expressed on a per share or boe basis, non-IFRS ratio, that do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. Non-IFRS financial measures and ratios are not standardized financial measures under IFRS and may not be comparable to similar financial measures disclosed by other issuers. Refer to the section “Non-IFRS and Other Specified Financial Measures”.
Selected financial and operational highlights should be read in conjunction with Hemisphere’s unaudited consolidated interim financial statements and related notes, and the Management’s Discussion and Analysis for the three months ended March 31, 2024 which are available on SEDAR+ at www.sedarplus.ca and on Hemisphere’s website at www.hemisphereenergy.ca. All amounts are expressed in Canadian dollars unless otherwise noted.
Quarterly Dividend
Hemisphere is pleased to announce that its Board of Directors has approved a quarterly cash dividend of $0.025 per common share in accordance with the Company’s dividend policy. The dividend will be paid on June 28, 2024 to shareholders of record as of the close of business on June 20, 2024. The dividend is designated as an eligible dividend for income tax purposes.
Credit Facility
The Company has completed its annual bank review and renewed its $35.0 million two-year extendible credit facility, with the next annual review date set for May 31, 2025.
Operations Update
Hemisphere’s Atlee Buffalo polymer injection projects both continue to perform well, contributing to slight overall corporate production growth. Current production is approximately 3,500 boe/d (99% heavy oil, field estimates between April 1 – May 25, 2024), 3% higher than the fourth quarter of 2023 despite no new wells having been brought online since last September.
In the first quarter of 2024, the Company received EOR project approval from the Ministry of Energy and Resources for a polymer flood pilot in its recently acquired Marsden acreage in Saskatchewan. Subsequently, Hemisphere executed a $5.6 million capital expenditure program, which included drilling five Marsden wells (three producers and two injectors). The Company has recently brought one well on primary production to a single well battery in order to gather initial test data required for EOR project planning. Hemisphere expects to commission a new polymer injection skid and oil treating battery for its Marsden project during the third quarter.
Preparation is also underway for the remainder of Hemisphere’s 2024 capital expenditure program, which includes up to nine new wells in the Atlee Buffalo area being drilled and brought on production to existing facilities later this summer.
Annual General and Special Meeting of Shareholders
Hemisphere’s Annual General and Special Meeting of Shareholders will be held at 10:00 am (Pacific Daylight Time) on May 30, 2024 in the Walker Room of the Terminal City Club located at 837 West Hastings Street, Vancouver, British Columbia.
About Hemisphere Energy Corporation
Hemisphere is a dividend-paying Canadian oil company focused on maximizing value-per-share growth with the sustainable development of its high netback, low decline conventional heavy oil assets through polymer flood enhanced recovery methods. Hemisphere trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol "HME" and on the OTCQX Venture Marketplace under the symbol "HMENF".
For further information, please visit the Company’s website at www.hemisphereenergy.ca to view its corporate presentation or contact:
Don Simmons, President & Chief Executive Officer
Telephone: (604) 685-9255
Email: info@hemisphereenergy.ca
Website: www.hemisphereenergy.ca