Serinus Energy Inc. (“Serinus”, “SEN” or the “Company”) (TSX:SEN, WSE:SEN) is pleased to provide the following update for its operations for the fourth quarter of 2015.
Fourth Quarter Production and Realized Prices
Average corporate production for the fourth quarter was approximately 3,957 boe/d (SEN WI), representing a 3% decrease from 4,072 boe/d in the third quarter. Production for January averaged 3,745 boe/d, including volumes from Ukraine since the previously disclosed sale of those assets will not close until on or before February 8, 2016.
Serinus’ working interest production from Tunisia for Q4 was 1,276 boe/d, 4.5% lower than the 1,336 boe/d in Q3. Oil averaged 1,007 bbl/d, and gas was 1.6 MMcf/d. The decrease was due primarily to reduced production from the WIN-12bis well, and downtime on 2 other wells needing changes of bottomhole pumps. WIN-12bis continues to experience scale build up in the production tubing, requiring periodic clean out. Oil and water samples are being analyzed to determine an appropriate inhibition program. Production for January averaged 1,073 boe/d. Gas sales at Chouech Es Saida which are normally in the range of 900 Mcf/d to 1 MMcf/d, are currently curtailed due to lower demand from STEG, the national gas utility. Management expects those sales to resume in February.
Estimated realized prices in Tunisia during the quarter were $42.35/bbl and $6.86/Mcf. There were two tanker lifts of oil during Q4.
In Ukraine, gas and condensate production during the fourth quarter were approximately 15.7 MMcf/d and 56 bbl/d respectively (both volumes are SEN’s 70% WI). These volumes are 2% lower and 6% higher respectively than the third quarter. The decline in gas production is substantially due to natural declines with the absence of development drilling. The slightly higher condensate rate is due to a higher proportion of overall production coming from the Olgovskoye field which is richer in liquids than Makeevskoye. Production for January averaged 15.6 MMcf/d and 65 bbl/d (SEN WI).
The estimated prices received in Ukraine during the quarter were $7.34Mcf and $46.84/bbl for natural gas and liquids respectively. The comparable prices realized in Q3 were $6.58/Mcf and $42.91/bbl.
As has been disclosed in previous press releases, Serinus is selling its Ukraine interests for
$30 million plus working capital and inter-company balance adjustments. The final closing is expected to occur on or before February 8, 2016.
Note: the volumes and prices referred to above are subject to minor revisions once final allocations and invoices are received.
Note: Serinus reports in US dollars. All dollar amounts referred to herein are in USD, unless specifically noted otherwise.
Outlook
In light of the current low commodity price environment, the Company’s focus will be on reducing costs wherever possible while maintaining existing production in Tunisia. The 2016 budget is being re- examined in light of the most recent drop in Brent crude oil prices.
In Romania, Serinus will concentrate on developing the Moftinu-1001 discovery. Management is currently refining the development drilling program and has commenced preliminary design of the required surface facilities. Pending gazetting of the Phase 3 extension of the Satu Mare Licence and the various permits and approvals required, drilling and construction could commence in mid-2016. The Company is considering taking on a joint venture partner to assist in financing the Moftinu project.
Abbreviations
| bbl | Barrel(s) | bbl/d | Barrels per day |
| boe | Barrels of Oil Equivalent | boe/d | Barrels of Oil Equivalent per day |
| Mcf | Thousand Cubic Feet | Mcf/d | Thousand Cubic Feet per day |
| MMcf | Million Cubic Feet | MMcf/d | Million Cubic Feet per day |
| Mcfe | Thousand Cubic Feet Equivalent | Mcfe/d | Thousand Cubic Feet Equivalent per day |
| MMcfe | Million Cubic Feet Equivalent | MMcfe/d | Million Cubic Feet Equivalent per day |
| Mboe | Thousand boe | Bcf | Billion Cubic Feet |
| MMboe | Million boe | Mcm | Thousand Cubic Metres |
| UAH | Ukrainian Hryvnia | USD | U.S. Dollar |
| CAD | Canadian Dollar |
Cautionary Statement:
BOEs 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.
Test results are not necessarily indicative of long-term performance or of ultimate recovery. The test data contained herein is considered preliminary until full pressure transient analysis is complete.
About Serinus
Serinus is an international upstream oil and gas exploration and production company that owns and operates projects in Ukraine, Tunisia, and Romania.
For further information, please refer to the Serinus website (www.serinusenergy.com) or contact the following:
Serinus Energy Inc. – Canada
Norman W. Holton
Vice Chairman
Tel.: +1-403-264-8877
Serinus Energy Inc. – Canada Gregory M. Chornoboy Director – Capital Markets
& Corporate Development Tel: +1-403-264-8877
Serinus Energy Inc. – Poland
Jakub J. Korczak
Vice President Investor Relations & Managing Director CEE
Tel.: +48 22 414 21 00
Translation: This news release has been translated into Polish from the English original.
Forward-looking Statements This release may contain forward-looking statements made as of the date of this announcement with respect to future activities that either are not or may not be historical facts. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable as of the date hereof, any potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors that could impair or prevent
the Company from completing the expected activities on its projects include that the Company’s projects experience technical and mechanical problems, there are changes in product prices, failure to obtain regulatory approvals, the state of the national or international monetary, oil and gas, financial , political and economic markets in the jurisdictions where the Company operates and other risks not anticipated by the Company or disclosed in the Company’s published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties and actual results may vary materially from those expressed in the forward-looking statement. The Company undertakes no obligation to revise or update any forward-looking statements in this announcement to reflect events or circumstances after the date of this announcement, unless required by law.