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The second quarter of 2008 was another period of significant achievements for Pacific Rubiales. Total gross crude oil production was 36,200 barrels per day. Gas production averaged 37 million cubic feet during this period (6,156 barrels of oil equivalents), for a total daily production of 42,356 barrels of oil equivalents. This operational level was achieved with a competitive operating cost of $4.34 per barrel of oil equivalents. In terms of net production, crude oil averaged 12,966 barrels per day. Including gas production, the company's total production was 19,122 barrels of oil equivalents.
Pacific Rubiales continued developing its ambitious business plan, which contemplates an increase of heavy crude oil production to 126,000 barrels per day by the end of 2009. Capital expenditures related to this plan totaled $147.2 million to the end of the second quarter, including a committed equity share amount of $41.1 million related to construction of the 260 kilometre pipeline to be completed by the end of the third quarter of 2009. Capital expenditures in the quarter included $15.7 million for exploration and production costs for the La Creciente block, $10.4 million for the appraisal well program to enhance the static model of the Rubiales field, $17.1 million for the construction of an additional central processing facility at the Rubiales field, and $3.2 million for seismic programs.
Net sales reported for the quarter were $158.6 million, an increase of 67% over the previous quarter's net sales of $94.9 million, due to higher production, increasing oil and gas prices and higher volume sold in the international market related to the company's successful new commercial scheme. These increased sales, combined with a reduction in the second quarter in net operating costs per barrel to $4.34 (compared to $5.08 per barrel in the first quarter), allowed Pacific Rubiales to reach an EBITDA (earnings before income taxes, depreciation and stock compensation) of $87 million, compared to an EBITDA of $39 million in the first quarter. The new commercial scheme, implemented in the first quarter, allowed the company to export an average of 12,334 barrels a day as 18.5 API blended crude, resulting in a netback to the company in the second quarter of $56.46/boe ($71.95/bbl oil), compared to a netback in the first quarter of $36.68/boe ($46.42/bbl oil).
Net income for the second quarter was $47.2 million, including a non-cash foreign exchange gain of $23.7 million resulting from the effect of the Colombian peso/US dollar exchange rate on future income tax liabilities. Cash flow from operations before non-cash working capital was $62.1 million.
Total assets were $1.9 billion, shareholders' equity was $1.3 billion and the company has $136 million in cash as at June 30, 2008.
Ronald Pantin, the company's Chief Executive Officer commented, "We are extremely pleased with our growth in production, netbacks, revenues and EBITDA in the second quarter. This growth, coupled with our decrease in operating costs per barrel, demonstrate our company's cash generating potential from operations. We remain on track for our goal of 126,000 barrels per day by the end of 2009." -- www.cnxmarketlink.com
Posted August 16th, 2008 by ruzik_tuzik
