Calvalley to drill two new exploration wells in Yemen in 2004
Calvalley Petroleum Inc., a Calgary-based oil and gas exploration and development company, reported cash flow from operations of $264,967 during the first quarter of 2003 on average oil and gas production of 123 barrels of oil equivalent per day (BOEPD) in comparison to cash flow of $452,799 in the same period of the prior year.
Cash flow for the three months ending March 31, 2003, while still negative improved by more than 40 percent year over year, as a result of higher commodity prices. The company reported a loss after income taxes of $321,277 for the first quarter ($0.01 per share) a significant improvement over the loss of $946,438 in the first quarter of last year.
Total oil and gas production in the first quarter was down 58 percent from the same period last year. This production decrease was primarily a result of reduced natural gas production at the company's Sousa property. Net backs in the first three months of the year increased significantly from $1.93 per BOE in 2002 to $5.07 per BOE.
The company's plans for the drilling of the next two exploration wells were delayed during the first quarter as a result of the war in Iraq. However, work continued in order to finalize the drilling locations and secure many of the required supplies and services.
Two new exploration wells will be drilled in Yemen by the end of the third quarter with the company's joint venture partners providing the estimated four million dollars required. At present, the company, as operator, is finalizing the arrangements for the drilling rig that will be utilized.
Management is focused on raising capital for the initial development of the Block, which it hopes to initiate later this year. The initial development plan contemplates the drilling of eight wells in the Hiswah and Auqban formations late this year or early in 2004, with the result that cash flow from Yemen could commence next year.
In Canada, management is reducing domestic expenditures with the intent of achieving positive cash flow by the middle of the third quarter of this year. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
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