CALGARY, ALBERTA — (Marketwired) — 05/07/13 — Long Run Exploration Ltd. (“Long Run” or the “Corporation”) (TSX: LRE) is pleased to report financial and operational results for the quarter ended March 31, 2013. This represents the first full quarter of operations as Long Run, a significant milestone in the evolution of the Corporation. Long Run aggressively drilled both the Montney and the Viking this quarter, adding more than 3,000 boe per day of production from 2012 fourth quarter exit volumes to first quarter 2013 exit volumes. The majority of production additions in the first quarter were crude oil volumes, a trend which Long Run expects to continue through 2013. Given strong first quarter results driven by operational results which met or exceeded expectations, Long Run awaits the end of Spring break up and a return to executing the 2013 capital program.
The unaudited financial statements of Long Run for the period ended March 31, 2013 and the related Management–s Discussion and Analysis (“MD&A”) can be accessed on-line on SEDAR at or on Long Run–s website at .
HIGHLIGHTS
FIRST QUARTER FINANCIAL AND PRODUCTION RESULTS
COMMODITY ENVIRONMENT
OPERATIONS UPDATE
Peace River Area Montney
Redwater Viking
Duvernay
Non-GAAP Measurements
This press release contains terms commonly used in the oil and natural gas industry, such as funds flow from operations, and funds flow from operations per share. These terms are not defined by International Financial Reporting Standards (IFRS) and should not be considered an alternative to, or more meaningful than, cash provided by operating activities or net earnings as determined in accordance with IFRS as an indicator of Long Run–s performance. Management believes that funds flow from operations is a useful financial measurement which assists in demonstrating the Corporation–s ability to fund capital expenditures necessary for future growth or to repay debt. Long Run–s determination of funds flow from operations may not be comparable to that reported by other companies. All references to funds flow from operations throughout this report are based on cash flow from operating activities before changes in non-cash working capital and abandonment expenditures. The Corporation calculates funds flow from operations per share by dividing funds flow from operations by the diluted weighted average number of Common Shares outstanding.
Long Run uses the term net debt herein. This measure does not have any standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies.
With respect to funds flow from operations and net debt, reference is made to the Corporation–s Management–s Discussion and Analysis for the three months ended March 31, 2013 which includes a table showing how they have been determined.
Long Run is a Calgary-based intermediate oil company focused on light-oil development and exploration in western Canada. For further information about Long Run, visit the Company–s website at .
ADVISORIES
Forward Looking Statements:
Certain information in this news release including management–s assessment of future plans and operations, 2013 average production guidance, expectation that operational and engineering improvements at Peace River will lead to increased drilling inventory and higher booked reserves, timing of new wells coming on-stream, timing of response to water injections at Peace River, plans to continue pilot enhanced recovery oil project at Redwater and the timing thereof, and timing of testing and availability of additional analysis of Duvernay well are forward looking statements. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties including, without limitation, risks related to closing of the disposition, 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, capital expenditure costs, including drilling, completion and facilities costs, unexpected decline rates in wells, wells not performing as expected, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements.
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. Although the Corporation 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 Corporation can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this document, 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 Corporation operates; the timely receipt of any required regulatory approvals; the ability of the Corporation 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 and exploration results; the timing and costs of pipeline, storage and facility construction and expansion and the ability of the Corporation to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Corporation operates; and the ability of the Corporation to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list of factors and assumptions is not exhaustive. Additional information on these and other factors that could affect Long Run–s operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (), at Long Run–s website (). Furthermore, the forward looking statements contained in this news release are made as at the date of this news release and Long Run 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.
BOES:
Disclosure provided herein in respect of barrels of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 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.
Netbacks:
Netbacks are calculated by subtracting royalties, transportation costs and operating costs from revenues.
Contacts:
Long Run Exploration Ltd.
William E. Andrew
Chair and Chief Executive Officer
(403) 261-6012
Long Run Exploration Ltd.
Dale A. Miller
President
(403) 261-6012
Long Run Exploration Ltd.
Jason Fleury
Vice President, Capital Markets
(403) 261-8302
Long Run Exploration Ltd.
Investor Relations
(888) 598-1330