Corcel Regulatory News (CRCL)

Caracal Energy Provides 2013 Half-year Results CALGARY, Aug. 19, 2013 /CNW/ - Caracal Energy Inc. ("Caracal", the "Company",or the "Group") is pleased to announce its half year results for the six monthsended June 30, 2013. 2013 Half-yearly results summary Caracal had a successful first half of 2013. The Badila development project wascompleted in early June. The Group was able to test new reservoir horizonssuccessfully, and apply modern 3D seismic techniques over the Badila andMangara developments and surrounding exploration opportunities. The Groupcontinues to undertake intensive analysis of the exploration portfolioopportunities. Caracal achieved a significant milestone with the admission ofits common shares to the premium list on the London Stock Exchange on July 9,2013. Operational Highlights · Completed construction and commissioning of the first phase of themodular production facilities and gathering system at Badila, · Completed construction and commissioning of the 17 kilometre pipelinefrom the Badila facilities to the TOTCO-COTCO export line, · Completed the interconnection with the TOTCO-COTCO export line, · Completed and tied-in the Badila-1 and Badila-2 wells, · Completed a 3D seismic survey covering the Badila field and theadjoining Bitanda Ridge exploration prospect. Bitanda Ridge explorationprospect is targeting 277 million bbls unrisked P mean, 648 million bblsunrisked P10, · Filed an application for the 25 year development license for theKibea field, · Drilled the Badila-3 well to a total depth of 2,150 meters, with testresults indicating production of approximately 2,400 bopd, · Drilled and cased the Mangara-5 development well, then deepened it toexplore and test the lower Cretaceous E sands, · Spudded the Krim exploration target on August 6, 2013, · Received delivery of a second drilling rig (Rig-96) in Chad and spudBadila-4 on August 8, 2013. Corporate Highlights · Admitted to the premium listing segment of the Official List of theFinancial Conduct Authority and began trading July 9, 2013 on the London StockExchange's main market for listed securities, · Completed the Farm-in Agreement with GlencoreXstrata plc("Glencore"), · Increased net entitlement proven plus probable reserves ("2P") by 59percent to 50.6 million barrels of light oil and proven plus probable pluspossible reserves ("3P") by 41 percent to 89.8 million barrels of light oil, · Increased mean unrisked gross lease prospective resources to 4.1billion barrels and mean risked gross lease prospective resources to 833million, · Increased Caracal's 2P Net Present Value to $1,413 million(discounted at 10% after tax) and 3P to $2,533 million (discounted at 10% aftertax), · The Group's convertible bonds issued in September 2012 were admittedto the official list of the Luxembourg Stock Exchange and have been admitted totrading on the Euro MTF market, · Appointed Peter Dey as independent director, · Exited the second quarter with working capital of $178.2 millionincluding cash and cash equivalents of $78.6 million, · Achieved a UK Classification by the FTSE Nationality Committee forpurposes of Caracal's application to be included on the FTSE index series. Outlook · Bitanda exploration target well to spud in the third quarter of 2013; · Complete the testing of the Cretaceous E sands at Mangara-5 well, · Complete and commission the Southern Processing Terminal ("SPT"). TheSPT will remove any remaining water or sediment from Mangara production justprior to allocation measurement and blending with Badila oil production. Theterminal construction is underway and expected to be completed and commissionedin Q4 2013, · Complete and commission the blending and shipping facilities requiredto bring Mangara onstream, · Exit 2013 at a forecasted gross production rate of 20,000 to 23,000barrels oil per day. Operational Review Badila Development Caracal has full 3D coverage of the Badila field, and the results of theinitial processing of the 3D seismic are incorporated in the mid-year reservesupdate. The results suggest extension of the Cretaceous D sands to the east ofthe previously understood field limits, and this extension will be confirmed byfurther drilling commencing with the Badila-4 well. The Badila-4 was spudded onAugust 8 and is expected to take 20 - 25 days to drill. Badila-3 Badila-3 was drilled to test the flank of the field structure at the CretaceousC and D levels. Drilling and petrophysical analysis suggested the CretaceousD sands may contain additional moveable oil, therefore, three additional welltests were added. Results are encouraging, and suggest economic reserves may beproduced from the C1a, C3, D6 and D8 zones as follows: ZONE COMMINGLED TESTING INDIVIDUAL TESTING POTENTIAL RATE WITH ESP Fluid Rate Oil Cut Fluid Rate Oil Cut Fluid Rate Oil Rate (BBL/day) % (BBL/day) % (BBL/day) (BBL/day) C1a 1,734 6% 697 11% 311 99 C3 1,438 5% 4,446 218 D4, D5 1,492 0% 7,500 0 D6 1,655 36% 6,834 2,434 D8 854 22% 2,641 585 Notes: Productivity Index was estimated from swab tests, and used to estimateESP (Electric Submersible Pump) rates at an intake pressure of 1,350 psi (~35%drawdown) The oil gravity of the D6 and D8 zones is ~36 degrees API. With only the D6 andD8 zones completed with an electric submersible pump, the well is capable of~2,400 barrels of oil per day commingled from these two zones. However, sincethis oil comes with ~5,100 barrels of water per day, these zones will beproduced when additional processing and water injection facilities areavailable. Badila Production The first phase of the modular Badila production facilities was completed onschedule at the end of May 2013. President Idriss Déby inaugurated the Badilafacilities on June 9, 2013 by opening the production shipping valve. Firstproduction from Badila is expected imminently. Mangara Development Mangara-4 The Mangara-4 development well spudded on March 13, 2013 and was drilled to atotal depth of 2,471 meters. Petro-physical results show 40-60 meters ofestimated oil pay in the lower Cretaceous C & D sands. The well was suspendeddue to hole instability, and will be re-entered in the near future andcompleted as a producer. Depending on the testing results of Mangara-5,Mangara-4 may be deepened and completed as a dedicated lower Cretaceous E sandsproducer. Mangara-5 The Mangara-5 development well was drilled and cased as a lower Cretaceous C &D sands producer. The well was also deepened to 3,339 meters to test theCretaceous E sands, a new exploration horizon below the Mangara field. Recent 3D seismic acquired over Mangara, which has been subjected tospecialized processing and interpretation techniques, suggests the sands withinthe lower Cretaceous E could hold significant hydrocarbons. From drilling andpetrophysical analysis, preliminary Mangara-5 results suggest this well has apotential range of 150-230 meters of estimated net oil pay in the Cretaceous Esands. The first of a series of planned tests was across a 25 meter intervaland achieved a maximum oil rate during this period of 815 bopd. The intervalproduced a total of 200 barrels of 39 degree API oil with no water over the 16-½ hour test period. Testing of the additional identified pay is ongoing withresults expected in early September. Exploration Caracal completed a 3D seismic program covering 320 km2 of the Badila field, aswell as the adjoining Bitanda ridge, where multiple exploration prospects hadpreviously been identified on 2D seismic. The 3D seismic confirmed closure of the Bitanda structure against a basinbounding fault, moving the priority of this exploration prospect near the topof the Group's drilling sequence. The Bitanda prospect is scheduled to spud inQ3 2013 targeting unrisked mean prospective resources of 277 million bbls asper the Group's recent reserves and resources evaluation dated effective June30, 2013 from McDaniel & Associates Consultants Ltd. (the "Competent PersonsReport", or "CPR"). On August 6, 2013 Caracal spudded the Krim exploration well targeting unriskedmean prospective resources of 29 million bbls exploration based on the CPR. TheKrim prospect is immediately adjacent to the Mangara field, with theimplication that a discovery here could be brought on stream in an expeditedmanner. Kibea development Caracal filed an Exclusive Exploitation Authorization ("EXA") application onApril 25, 2013 and was deemed conditionally approved on May 25, 2013 pendingsubmission of an Environmental Impact Assessment ("EIA"). The EIA is underway,and potential pipeline routes are being surveyed. A 3D seismic survey over theKibea field and nearby exploration prospects is scheduled to commence in the4th Quarter of 2013 or 1st Quarter of 2014. Based on well drilling sequence andconcentration on west side of the E sands in the Mangara structure, the Kibeaappraisal well that was originally scheduled for Q4 2013/Q1 2014 may be delayeduntil Q3 2014, after the rainy season. The appraisal well will test deeperhorizons and obtain core and fluid samples for development planning andfacilities design. Outlook The first half of 2013 has been transformational for Caracal. With the closingof the Glencore transaction and with production commencing in the very shortterm, Caracal is in a position to develop its existing world class asset basewhile pursing accretive opportunities. Caracal is forecasting to exit 2013 inthe range of 20,000 to 23,000 bopd (gross). Finance Review Commitments Under the terms of its individual production sharing contracts ("PSC's") theGroup has committed to various work programmes. The agreed-upon minimum workrequirement amounts to $115.0 million for the three PSCs over five years. As atJune 30, 2013, $76.8 million is yet to be spent with three more years remainingin the agreements. Other commitments consist of training of Chadian Nationals and employees of theEnergy Ministry as well as office lease commitments in both N'Djamena, Chad andCalgary, Alberta. Liquidity The Group's available cash resources as at June 30, 2013 and 2012 were $78.6million and $100.7 million respectively. The Group exited the second quarterwith working capital of $178.2 million. The Group entered into the GlencoreFarm-in agreement in 2012 which closed in June 2013. This transaction providedapproximately $330.8 million in liquidity and reduces future capitalrequirements by reducing the Group's working interest in the PSCs. Historically, the Group financed its capital resource needs through the sale ofits common shares, convertible bonds and farm-outs with the objective of theacquiring prospective oil and gas assets and maximizing long-term financialreturns to its shareholders. The Group may consider additional debt, theissuance of equity and other farm-outs in the future, if available onreasonable terms, in order to accelerate exploration drilling on its existinglands or pursue accretive opportunities. Principal risks and uncertainties Information regarding the Group's risk factors may be found under the headings"Risk Factors" in the Group's final Canadian prospectus dated July 2, 2013available under the Caracal's profile on SEDAR (www.sedar.com) and the final UKprospectus dated June 28, 2013 available on the Group's website (tonon-Canadian viewers). Strategy The strategy of the Group is to increase shareholder value through sustainedgrowth in production, cash flow and reserves. Reserves growth targets includeoptimum development of six known discoveries on lands in Chad, as well asreinvestment of cash flow for exploration of 80 identified prospects on landsin these licenses. The Group intends to lead the development and operate infrastructure in theregions in which it develops and produces oil and gas. The PSCs offersignificant near-term production and long-term exploration opportunities withsubstantial resource potential. The combination of the Group's existing assetbase and experienced technical management team will contribute significantly tothe Group's growth and aim of being a leading independent international oilGroup. The Group is able to manage expenditures on its development of Mangaraand Badila, through the completion of the $330.8 million Farm-in with Glencore.The Group remains focused on bringing Mangara on production and have commencedthe engineering of the expansion of both the Badila and Mangara facilities.These two fields will provide the Group the required cash flow to fund itsexploration program. UK Classification for FTSE UK Index Series Inclusion On August 13, the FTSE Nationality Committee allocated Caracal a UKclassification for FTSE UK index series inclusion purposes. As part of itsapplication to be indexed, Caracal agreed to commit to adhere to the UKTakeover Code to the extent reasonably practicable. At the next shareholdermeeting, Caracal will amend its articles of incorporation to include thiscommitment. With this classification determined, the FTSE Committee willconsider Caracal's application to be included in the FTSE index at itsquarterly meeting on September 11, 2013. About Caracal Energy Inc. Based in Canada, Caracal Energy Inc. is an international exploration anddevelopment company focused on oil and gas exploration, development andproduction activities in the Republic of Chad, Africa. In 2011, the Companyacquired three production sharing contracts ("PSCs") from the government of theRepublic of Chad. These PSCs provide exclusive rights to explore and developreserves and resources over a combined area of 26,103 km2 in southern Chad. ThePSCs cover two world-class oil basins with development opportunity, oildiscoveries, and numerous exploration prospects. Cautionary Statement Certain information contained in this press release constitutes forward-lookinginformation or statements including, without limitation, information andstatements respecting: drilling operations, anticipated cash flow, futureinvestment objectives, anticipated oil and gas pricing, expected inflation andfuture foreign exchange rates. Statements relating to "reserves" and"resources" are forward-looking information as they involve the impliedassessment, based on certain estimates and assumptions that, among others, thereserves and resources described exist in the quantities predicted orestimated. Forward-looking information and statements are often, but notalways, identified by the use of words such as "anticipate", "seek", "believe","expect", "hope", "plan", "intend", "forecast", "target", "project","guidance", "may", " might", "will", "should", "could", "estimate", "predict"or similar words or expressions suggesting future outcomes or languagesuggesting an outlook. By their very nature, forward-looking information andstatements involve inherent risks and uncertainties, both general and specific,and risks that predictions, forecasts, projections and other forward-lookinginformation and statements will not be achieved. We caution readers not toplace undue reliance on these statements as a number of important factors couldcause the actual results to vary materially from the forward-lookinginformation or statements. These factors include, but are not limited to: thevolatility of oil and gas prices; production and development costs; capitalexpenditures; the imprecision of reserve and resource estimates and estimatesof recoverable quantities of oil, natural gas and liquids; the Company'sability to replace and expand oil and gas reserves; environmental claims andliabilities; incorrect assessments of value when making acquisitions ordispositions; increases in debt service charges; the loss of key personnel; themarketability of production; defaults by third party operators; unforeseentitle defects; fluctuations in foreign currency and exchange rates; inadequateinsurance coverage; compliance with environmental laws and regulations; changesin tax and royalty laws; the Company's ability to access external sources ofdebt and equity capital; and the Company's ability to obtain equipment in atimely manner to carry out development activities. Further informationregarding these factors may be found under the headings "General Advisory","Reserves and Resources Advisory" and "Risk Factors" in the Company's finalCanadian prospectus dated July 2, 2013 available under the Company's profile onSEDAR (www.sedar.com) and the final UK prospectus dated June 28, 2013 availableon the Company's website (to non-Canadian viewers). Readers are cautioned thatthe foregoing list of factors that may affect future results is not exhaustive.When relying on these forward-looking statements to make decisions with respectto the Company, investors and others should also carefully consider informationset forth in the section "Forward-Looking Statements" of the Company'sprospectuses respecting the assumptions upon which the Company bases certainforward-looking information and the uncertainties inherent in such assumptions.The Company does not assume responsibility for the accuracy and completeness ofthe forward-looking information or statements and such information andstatements should not be taken as guarantees of future outcomes. Subject toapplicable securities laws, the Company does not undertake any obligation torevise this forward-looking information or these forward-looking statements toreflect subsequent events or circumstances. This cautionary statement expresslyqualifies the forward-looking information and statements contained in thispress release. SOURCE: Caracal Energy Inc. For further information: Caracal Energy Inc.Gary Guidry, President and Chief Executive OfficerTrevor Peters, Chief Financial Officer403-724-7200 Longview Communications - Canadian Media EnquiriesAlan Bayless 604-694-6035Joel Shaffer 416-649-8006 FTI Consulting - UK Media EnquiriesBen Brewerton / Ed Westropp+ 44 (0) 207 8313 3113caracalenergy.sc@fticonsulting.com

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