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Send out the clowns and make the Aim market less of a circus
www.telegraph.co.uk | Aug 4, 2008
Get the latest business and finance news from the Telegraph. Your source for finance, investing, mortgage and savings news
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/08/04/cxmktrep104.xml
FIRST CALGARY PETROLEUMS LTD - 2nd Quarter Results
www.smartbrief.com | Aug 1, 2008
We are pleased to update our shareholders on the Company's activities in the last quarter. It was an active quarter and many key operational goals were achieved.
They tried to bring private equity to heel and kicked AIM in the guts
news.independent.co.uk | Oct 28, 2007
The Alternative Investment Market had already suffered some knocks before the Chancellor announced changes to the UK's capital gains tax (CGT) regime in his pre-Budget report earlier this month. But the measures, which will increase the tax on gains made from investing in many AIM shares by 80 per
http://news.independent.co.uk/business/analysis_and_features/article3104568.ece
Need to know
business.timesonline.co.uk | Oct 20, 2007
Economics Fears over inflation and the threat of US recession were fuelled yesterday by a new surge in oil prices to record highs above $90 a b
http://business.timesonline.co.uk/tol/business/markets/article2698311.ece
Web Sites
Total : 46 View more »
minesite.com: Magnesium Int'l Ltd
Amazon Bay Ironsands Project During the quarter the company agreed to acquire up to a 90% interest in the Amazon Bay ironsands project in Papua New Guinea. The transactions terms were approved by shareholders on 24th October, 2007.
http://www.minesite.com/companies/comp_single/company/magnesium-intl-ltd.html
International translation for business - Aplomb Translations - Client list
Aplomb Translations ENGLISHFRANÇAISESPAÑOL services expertise clients company faqs contact Testimonials Case studies More case studies Testimonials “Thank you very much for your continued reliable service.” Case studies We have undertaken language translation projects for a wide variety of clients
AFC energises for AIM
The company, based at premises in Dunsfold, Surrey, has set itself the aim of producing an alkaline fuel cell systems at a significantly lower cost than any other available and which are commercially viable.
http://www.growingbusiness.co.uk/AFC_energises_for_AIM.Yats0bRoEmfC1w.html
AMBRIAN CAPITAL Share Price Stock, Quote | AMBR.L | GB0003763140 | Yahoo! Finance UK
Copyright 2007 (c) Yahoo! UK Ltd. All rights reserved. Questions | Disclaimer | Quotes Information Quotes delayed except where indicated otherwise. Delay time is 20 mins for London stock exchange. See also delay times for other exchanges.
News from Zibb.com
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SOLANA RESOURCES LIMITED - Drilling Report - Zibb.com
Jun 19, 2008 (PR Newswire Europe via COMTEX) --
Solana Resources Limited ("Solana" or the "Company") - Palmitas-2 Exploration
Well Test Results
CALGARY and LONDON, June 19 /CNW/ - Solana Resources Limited (TSX-V: SOR;
AIM: SORL) announces that the Palmitas-2 well, testing a structure identified
on 2-D seismic and located on the Guachiria Sur block in the Llanos Basin,
Colombia, will be suspended for further evaluation.
Palmitas-2 reached a total depth of 6,905 feet on March 28, 2008, and
following logging, sidewall coring and MDT tests was cased. While initial log
interpretations and MDT tests indicated potential oil pay in the Carbonera C-7
Formation, subsequent extensive cased hole testing with a jet pump failed to
yield commercial oil rates. The very low salinity of the produced water in
this area of the Llanos basin makes log interpretation difficult. Further
evaluation of the well is dependent on mobilizing specialized production
logging tools, which are currently not available in Colombia.
Solana remains committed to its Llanos exploration program and plans to
spud the Los Aceites-1 well around the middle of July, which is an addition to
the Company's 2008 Llanos program. The Los Aceites-1 well will be located
3.3 km south-southwest of, and on trend with, Solana's recent Primavera-1
discovery on the Guachiria block. Available 3-D seismic indicates that the Los
Aceites structure is expected to be 70 feet higher than Primavera.
Although exploration activity is normally confined to the January through
March dry season in this area of the Llanos basin, Solana, as a test, is
currently completing construction of a 3.8 km road and the Los Aceites-1 well
location. Based on this exercise, the Company will be able to determine the
economic viability of wet season exploration.
Solana is the operator and holds a 100% working interest in the Guachiria
and Guachiria Sur blocks. Lewis Energy Colombia holds a 30% beneficial
interest in both blocks. The blocks are subject to fiscally attractive Agencia
Nacional de Hidrocarburos contracts. The Guachiria block also attracts an
additional 13% overriding royalty, applied after government royalties, to
Ecopetrol, the State oil and gas company.
Mr. Glenn Van Doorne, Chief Operating Officer of Solana, a Petroleum
Geologist, is the qualified person who has reviewed the technical information
contained in this news release.
Forward Looking Statements
Certain information regarding the Company, including management's
assessment of future plans and operations, may constitute forward-looking
statements under applicable securities law and necessarily involve risks
associated with oil and gas exploration, production, marketing and
transportation such as loss of market, volatility of prices, currency
fluctuations, imprecision of reserve estimates, mechanical problems, equipment
limitations, environmental risks, competition from other producers and ability
to access sufficient capital from internal and external sources; as a
consequence, actual results may differ materially from those anticipated.
Solana Resources Limited
Solana (www.solanaresources.com) is an international resource company
engaged in the acquisition, exploration, development and production of oil and
natural gas. The Company's properties are located in Colombia, South America
and are held through its wholly owned subsidiary, Solana Petroleum Exploration
(Colombia) Limited. The Company is headquartered in Calgary, Alberta, Canada.
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENT OF THIS
RELEASE. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE
For further information: Enquiries: Solana Resources Limited: Scott Price,
jsp(at)solanaresources.com, (403) 770-1822; Ricardo Montes,
rmontes(at)solanaresources.com, (403) 770-1822; Nabarro Wells & Co. Limited
(Nominated Adviser): Robert Lo, RobertLo(at)nabarro-wells.co.uk, Marc Cramsie,
MarcCramsie(at)nabarro-wells.co.uk, +44 20 7634 4705; Tristone Capital Limited
(UK Broker): Nick Morgan, nmorgan(at)tristonecapital.com, +44 207 355 5800;
Pelham Public Relations: Philip Dennis, philip.dennis(at)pelhampr.com, +44 207
743 6363; James MacFarlane, james.macfarlane(at)pelhampr.com, +44 207 743
6375
(SORL)
END
Tags: alberta broker calgary canada colombia commercial construction currency energy exercise exploration government london market marketing natural gas oil oil and gas petroleum prices public relations rates securities law south america transportation water yield
Companies: Solana Resources Ltd (SORFF)
COPPER RESOURCES CORPORATION - Directorate Change - Zibb.com
Jun 30, 2008 (PR Newswire Europe via COMTEX) --
For immediate release 30 June 2008
Stock Exchange Announcement
COPPER RESOURCES CORPORATION
Board Changes
The Board of Copper Resources Corporation (AIM: CRC.L) (the "Company") is
pleased to announce that on 20th May 2008, the Company appointed Mr Maritz
Smith to the Board of Directors. Mr Smith will hold the position of director
responsible for finance, and immediately joined the Audit Committee.
Mr Smith is a director of Metorex Limited, a listed mining company which holds
a beneficial interest of 50.22% of the existing issued share capital of the
Company. He also sits on the Board of Pan African Resources plc, again being
responsible for the finance function.
Mr Smith joined Metorex in 2002 from the auditing firm, Deloitte & Touche. He
was appointed Chief Financial Officer of Metorex in 2005, and has been
responsible for the Group's financial affairs and overall reporting since then.
In November 2007, he was appointed to the Metorex Board.
Save as disclosed below, there is nothing further to disclose in relation to
the appointment of Mr Smith under Schedule Two, paragraph (g) of the AIM Rules:
Full name: Maritz Smith
Previous names: None
Age: 32
In addition to his directorship of the Company, Mr Smith is, or has been, a
director or partner of the following companies or partnerships, in the previous
five years:
Current directorships/partnerships
Metorex Limited
Pan African Resources Plc
Past directorships/partnerships
-
Copper Resources Nabarro Wells & Fox-Davies GTH
Corporation Co. Limited Capital Limited
Communications
Jeff Carel Hugh Oram Richard Hail Toby Hall
Company Secretary
+27 (0) +44 (0) +44 (0) +44 (0)
11 803 1073 20 7710 7400 207 936 5200 20 7153 8035
END
Tags: communications copper finance mining schedule
Companies: Copper Resources Corp (CPERF)
SOLANA RESOURCES LIMITED - Drilling Report - Zibb.com
Aug 06, 2008 (PR Newswire Europe via COMTEX) --
Solana Resources Limited ("Solana" or the "Company") - Costayaco-5 Drilling &
Operations Update
CALGARY and LONDON, Aug. 6 /CNW/ - Solana Resources Limited (TSX-V: SOR;
AIM: SORL) is pleased to announce that the Costayaco-5 well, a down dip field
delineation well located approximately 1,120 meters west of Costayaco-2 and
1,060 metres north west of Costayaco-1, has been successfully drilled, logged
and cased. Initial evaluation indicates that Costayaco-5 has potential oil pay
in four separate formations.
The Costayaco field was discovered in the second quarter of 2007 and is
located in the Chaza block, Putumayo Basin, southern Colombia. The field is
currently producing approximately 7,000 barrels of oil per day ("bopd") gross,
3,220 bopd net of royalty to Solana.
Solana holds a 50% working interest in the Chaza block with Gran Tierra
Energy Inc., the operator, holding the balance. This block is subject to an
Agencia Nacional de Hidrocarburos contract.
Chaza Block: Costayaco Field
Costayaco-5 Drilling and Testing
Costayaco-5 reached a total measured depth of 8,703 feet on July 27,
2008, encountering the same reservoir sequences as the other Costayaco wells
with good oil shows in the Rumiyaco Kg formation, the Villeta U and T
formations and the Upper Caballos formation.
Initial log interpretations, combined with cuttings and shows indicate
excellent reservoir with fair to good oil saturations in the primary Villeta T
formation, with thicknesses comparable to previous wells in the field. No
definitive oil-water contact is apparent in the Villeta T however, testing
will be required to confirm whether water is present in certain intervals. The
Upper Caballos also appears to have good oil saturations and thicknesses
comparable to previous wells drilled in the field. The Lower Caballos is well
developed, but appears to be water bearing. The top of the Villeta T and the
top of the Caballos were encountered at shallower depths than expected and oil
shows were encountered deeper than expected in both the Villeta T and the
Upper Caballos reservoirs; both results have the potential to add significant
reserves to the west flank of the field. Testing operations are expected to
commence in mid August and will take approximately one month to complete.
Costayaco-4 Testing
Costayaco-4 testing is expected to commence in early August, 2008;
delayed due to the test rig being retained for longer than expected on another
location. At Costayaco-4 initial log interpretations, combined with core
samples and hydrocarbon shows, indicate reservoir quality sandstones with
approximately 16 ft of potential oil pay in the Rumiyaco Kg, 18 feet in the
Villeta U, 38 feet in the Villeta T, and 134 feet in the Caballos formations.
This is approximately 25% more potential net pay than in any of the previous
three wells in the field. The testing program is expected to take
approximately one month.
Additional Drilling
A continuous delineation and development drilling campaign in the
Costayaco field is planned for the balance of 2008 and through 2009. The
details of this program will be finalized in the fourth quarter of 2008.
Infrastructure
An 8 inch diameter, 10 kilometer pipeline from the Costayaco field to the
Uchupayaco Station on the existing pipeline system was completed on July 29,
2008, and is currently being tested. This new pipeline will have a capacity of
25,000 barrels oil per day ("bopd"). Initial throughput will be approximately
8,500 bopd due to downstream pipeline constraints. Options to increase
production utilizing trucks to bypass infrastructure constraints, and to move
additional volumes north to Neiva, are being developed with gross Costayaco
field production expected to rise to 13,000 to 15,000 bopd by year end 2008,
with additional production capacity behind pipe.
Additional infrastructure expansion to accommodate the anticipated
increase in production from the continuing Costayaco drilling program and to
negate the need for trucking is advancing.
Llanos Basin: Guachiria Block:
Primavera-1 Extended Term Test
The Company has obtained necessary approvals and plans to initiate a long
term test at Primavera-1 within the next week. Primavera-1 was drilled in
February - March 2008, and tested in May 2008. Eight feet of perforations in
the Carbonera C-7 formation tested at a pump constrained rate of 650 bopd
(gross), 365 bopd net of royalty to Solana, over a continuous 24 hour period.
The well produced with a stable water cut of approximately 58% during this
production period.
Los Aceites-1 Drilling
Drilling commenced on the Los Aceites-1 exploration well on August 2,
2008. This well is testing a closed structure that was defined with 3-D
seismic and is targeting the Carbonera C5 and C7 formations. Los Aceites-1 is
approximately 3.3 kilometers south of, roughly 80 feet structurally higher
than, and on trend with the Primavera-1 well that tested 650 bopd from the
Carbonera C-7 formation. The well has a projected depth of 7,100 feet and is
anticipated to take 20 days to drill, with testing to follow.
Solana is the operator and holds a 100% working interest in the Guachiria
block with Lewis Energy Colombia holding a 30% beneficial interest. The block
is subject to an Agencia Nacional de Hidrocarburos contracts with a 13%
overriding royalty payable to Ecopetrol that is applied after government
royalties.
Mr. Glenn Van Doorne, Chief Operating Officer of Solana, a Petroleum
Geologist, is the qualified person who has reviewed the technical information
contained in this news release.
Forward Looking Statements
Certain information regarding the Company, including management's
assessment of future plans and operations, may constitute forward-looking
statements under applicable securities law and necessarily involve risks
associated with oil and gas exploration, production, marketing and
transportation such as loss of market, volatility of prices, currency
fluctuations, imprecision of reserve estimates, mechanical problems, equipment
limitations, environmental risks, competition from other producers and ability
to access sufficient capital from internal and external sources; as a
consequence, actual results may differ materially from those anticipated.
Solana Resources Limited
Solana (www.solanaresources.com) is an international resource company
engaged in the acquisition, exploration, development and production of oil and
natural gas. The Company's properties are located in Colombia, South America
and are held through its wholly owned subsidiary, Solana Petroleum Exploration
(Colombia) Limited. The Company is headquartered in Calgary, Alberta, Canada.
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENT OF THIS
RELEASE. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE
For further information: Enquiries: Solana Resources Limited: Scott Price,
jsp(at)solanaresources.com, (403) 770-1822; Ricardo Montes,
rmontes(at)solanaresources.com, (403) 770-1822; Nabarro Wells & Co. Limited
(Nominated Adviser): Robert Lo, robertlo(at)ambrian.com; Marc Cramsie,
marccramsie(at)ambrian.com, +44 20 7634 4705; Tristone Capital Limited (UK
Broker): Nick Morgan, nmorgan(at)tristonecapital.com, +44 207 355 5800; Pelham
Public Relations: Philip Dennis, philip.dennis(at)pelhampr.com, +44 207 743
6363; James MacFarlane, james.macfarlane(at)pelhampr.com, +44 207 743 6375
(SOR. SORL)
END
Tags: alberta broker calgary canada colombia contract currency energy expansion exploration government london market marketing natural gas oil oil and gas petroleum pipeline prices public relations securities law south america transportation trucking water
Companies: Solana Resources Ltd (SORFF)
FIRST CALGARY PETROLEUMS LTD - 2nd Quarter Results - Zibb.com
Aug 01, 2008 (PR Newswire Europe via COMTEX) --
First Calgary Petroleums Ltd. Announces Significant Milestones Achieved on the
MLE and CAFC Developments in Algeria and 2008 Second Quarter Results
Note: $ refers to the U.S. dollar and C$ refers to the Canadian dollar.
TSX: FCP
AIM: FPL
CALGARY, July 31 /CNW/ - First Calgary Petroleums Ltd. (FCP or the
Company) announces its results for the three and six months ended June 30,
2008.
President's Report
We are pleased to update our shareholders on the Company's activities in
the last quarter. It was an active quarter and many key operational goals were
achieved.
- Four technical bids were received in response to our invitation for
the Engineering, Procurement and Construction (EPC) contract for the
development of the MLE area.
- Major contracts have been successfully placed for the MLE area
development.
- The Final Discovery Report (FDR) for the Central Area Field Complex
(CAFC) area has been completed and submitted to the Algerian
government for approval, as a step towards commercialization of this
area.
- Pre-Qualification from Algeria's Agence National pour la Valorisation
des Resources en Hydrocarbures (ALNAFT) for the upcoming licensing
round for oil and gas exploration acreage.
- Ongoing discussions with European banks indicate a high level of
interest in a reserve based project financing for a high quality
project. The Company will present its financing and detailed
information package to the banks in September, targeting the
obtaining of formal underwriting offers in the fourth quarter of 2008
First Calgary has achieved major milestones, as we move towards
commercializing and securing first gas from our assets in Algeria. Technical
bids were received from each of the four pre-qualified contractors that were
sent an Invitation to Tender (ITT) for the EPC contract for the MLE area
development.
Two successful bidders have been chosen to secure the long lead line pipe
items. As well, FCP and Sonatrach have also placed a contract with ENGCB, a
major Algerian civil contractor, for the early civil work required to prepare
the site for construction and field work and a contract for the procurement
and construction of the operation base in Hassi Messaoud was recently awarded
to RedSea Housing. Collectively, the cost of these combined awards is less
than the Front End Engineering and Design (FEED) cost estimates for these
items.
First Calgary has completed the final draft of the Final Discovery Report
(FDR) for the CAFC area. This document outlines detailed development programs
for fields in the CAFC. The report has been delivered to the Algerian
authorities for approval, which is anticipated to be received by year end.
FCP has received pre-qualification by Algeria's Agence National pour la
Valorisation des Resources en Hydrocarbures (ALNAFT) for the upcoming
licensing round of oil and gas exploration acreage. The pre-qualification will
allow participation as operator and investor for onshore permits. This is the
seventh Algerian licensing round since 2000, with 16 permits on offer across
many of the petroleum basins in the country, including the Berkine Basin where
FCP's prolific Block 405b is located. The bid round closes on December 17,
2008.
I am very pleased with the progress being made in both the MLE and CAFC
developments. While project execution and debt financing remain a principal
focus, we continue to explore strategic and other options to maximize value
for shareholders.
Shane P. O'Leary
President and CEO
Management's Discussion and Analysis
Management's discussion and analysis (MD&A) is a review of operations,
current financial position and outlook for First Calgary Petroleums Ltd.
(First Calgary, FCP or the Company). It should be read in conjunction with the
unaudited interim financial statements for the six months ended June 30, 2008
and 2007 and the audited financial statements and MD&A for the year ended
December 31, 2007. In this discussion and analysis $ refers to U.S. dollars
unless otherwise indicated, and C$ refers to the Canadian dollar.
THE COMPANY
Readers are referred to the map which is available on the Company's
website at www.fcpl.ca.
First Calgary Petroleums Ltd. is an international oil and gas exploration
and development company with assets located in the prolific Berkine Basin of
Algeria. FCP's interest in Block 405b focuses on two development areas -
Menzel Ledjmet East (MLE) and the Central Area Field Complex (CAFC).
In February 2007, FCP received approval from the Algerian regulatory
authority (ALNAFT) for the development of the MLE oil and gas field on Block
405b. The first phase of the overall development plan design includes
construction of a gas plant and field gathering system and facilities designed
to produce up to 260 million cubic feet of sales gas per day (MMCF/d) and
20 thousand barrels per day (Mb/d) of associated natural gas liquids and oil,
on a gross basis. Three product pipelines are required to transport sales gas,
condensate and LPG products to the national grid system located 140 km west of
the Block. In addition, a fourth pipeline to transport oil will tie into
existing infrastructure within the Berkine Basin.
FCP was granted an extension to December, 2008 to further appraise and
evaluate the ZER area and the CAFC area. FCP and Sonatrach have agreed to
modify the design of the product pipelines to accommodate increased volumes
from the development of the CAFC as part of an integrated block development
strategy. As a result, the current block development plans (MLE plus CAFC) are
targeting up to 300 MMCF/d sales gas with up to 40 Mb/d of liquids, based on
the recent CAFC development plan recently submitted to Sonatrach.
OPERATIONAL UPDATE
FCP's objectives remain to achieve first production in the shortest time
possible. Based on the technical bids received from EPC contractors we have
re-evaluated the MLE development timetable and now believe first production
from MLE will be achieved in second quarter of 2011. Current industry activity
levels are prolonging developments on a world wide basis as evidenced by the
EPC technical bids.
Menzel Ledjmet East (MLE) Activities and Outlook
Engineering, Procurement and Construction (EPC)
-----------------------------------------------
In the first quarter, four pre-qualified bidders were requested to submit
technical bids for the large EPC contract on the basis of a detailed
Invitation to Tender (ITT) document developed during the Front End Engineering
and Design (FEED) phase. The ITT scope included central processing facilities,
associated infrastructure and all related gathering and export pipelines. The
technical bids were received on the due date of July 16 and a rigorous
validation and analysis of each is under way by a joint Sonatrach-FCP
evaluation team based in Hassi Messaoud. The second phase of the tender
process requires qualified bidders to submit the commercial portion of their
bids at the end of the technical evaluation. FCP expects that the contract
will be awarded in the second half of this year conditionally upon securing
the project financing commitments. The process of awarding the EPC contract
will involve significant exercises in due diligence. All potential EPC
contractors must be able to deliver the completed facility for a lump sum
price with a guaranteed end date and performance at the specified level. The
assurances provided by the EPC contractor in meeting these obligations must
satisfy the financial requirements of the bankers as FCP simultaneously seeks
project financing.
Long Lead Items
---------------
In order to maintain the aggressive schedule needed to achieve first gas
in the second quarter of 2011, it is necessary to secure long lead items such
as line pipe. ITT packages for the gas gathering system and export system line
pipe were issued and ten bids were received. These bids have been evaluated
based on technical merit and commercial tender has been received. After
careful evaluation of the commercial bids, the two successful bidders were
selected on July 22, 2008. Despite the heated market and recent significant
rises in raw material and energy prices the project team was able to procure
the gathering systems and export systems line-pipe at a cost that is below the
independent Genesis FEED cost estimate for this long-lead procurement, and
within the timescales required by our aggressive schedule for first
production.
During the FEED process, other equipment had been identified as potential
long lead items. Subsequent market evaluation resulted in this equipment being
rated 'non-schedule critical' and included within the EPC contract noted
above.
Civil Engineering Works
-----------------------
To support the aggressive EPC schedule demanded from potential EPC
contractors, it is necessary to commence early civil engineering preparatory
works to enable the successful EPC contractor to commence work onsite shortly
after contract award.
The contract for early civil works comprising the preparation of working
'platforms' for all temporary and permanent works including road
infrastructure was awarded to ENGCB (a local Algerian company) in early July
2008. ENGCB have commenced mobilization at the site and work is progressing.
Joint Venture Organization
--------------------------
The Block 405b Base de Vie in Hassi Messaoud will provide housing and
offices for approximately 185 joint venture staff required to oversee the
day-to-day operations of the transitions from an exploration to a development
organization. The Hassi base staff will include management, contract
administration, logistics, human resources, IT and telecommunications, etc.
Working with Sonatrach, the base construction contract has been awarded, and
work has commenced. It is expected that by December 2008 some of the base will
be available for occupancy.
Drilling Activities
-------------------
Development drilling continues in the MLE area utilizing one rig. These
development wells have been successful in further delineating the key zones
that will make up production for first gas. In the quarter, FCP stepped
outside the current mapped proven and probable reserves areas and drilled
MLE-10 to a depth of 3,660 metres. The MLE-10 well was located to test the
potential expansion of the key reservoir units to the south-western limit of
the MLE area within the Block. Unfortunately, the well was not successful in
delineating pool boundary extensions.
MLE-9 was spudded and is expected to be drilled to total depth in the
Lower Devonian in August. The next well to be drilled after MLE-9 will be
MLE-11 which will test an extension of the structure on the key zones of
interest to the east of MLE-4. Currently, approval from Sonatrach is pending
for MLE-13, which is anticipated to be spud and drilled in the fourth quarter
of 2008.
Central Area Field Complex (CAFC) and ZER Activities and Outlook
FCP was granted an extension to December 30, 2008 to further appraise and
evaluate the ZER area and the CAFC area. Upon completion of the appraisal and
testing program of the CAFC within the first quarter, FCP focussed efforts on
the subsurface studies that would constitute the technical components of the
Final Discovery Report (FDR). After numerous technical workshops and
discussions with Sonatrach, the final draft of the FDR was completed on
July 19, 2008 and delivered to the Algerian authorities. The FDR contains the
development and commercialization plans of the CAFC area, the next area of
development in Block 405b. On-going discussions with Sonatrach will lead to
further refinement of the report, and approval of the development plan is
anticipated to be received by year end.
After careful consideration and analysis, it has been determined that
further pursuit of commercial development of the ZER area would not be
economical. The ZER area will be relinquished so that the Company can focus
resources on developing the MLE and the CAFC area.
Financing Activities and Outlook
Continued discussions held between FCP and a number of banks, primarily
European, indicate that while the current overall bank market environment is
challenging, interest in financing for quality projects is still high in
general, and that there continues to be strong interest in FCP's Algerian
project. The Company expects that its share of MLE development costs can be
principally financed via reserve based debt financing and the available cash
on hand. If necessary, the Company will raise additional equity; the amount of
which is dependent upon a number of factors including the final cost of the
EPC contract and the amount of project debt financing raised. The project's
debt financing capacity will depend on the forward commodity price curve when
the financing is set in place, among other factors.
The Company will present its financing package to the banks in September
and anticipates formal underwriting offers in the fourth quarter of 2008.
Financing for CAFC development will follow that of MLE, and is expected to
benefit from the MLE financing process.
Banks require that as a precondition to financing, all key project
related commercial and technical agreements are in place, including among
others, product marketing/off-take agreements, EPC contractual arrangements,
technical, environmental and legal due diligence reports, and comprehensive
legal credit documentation. FCP is working closely with its principal legal
advisor, Clifford Chance, and financial advisor, Citigroup, to ensure that all
necessary agreements and documentation related to the project financing are
delivered within the requisite time frame. Excellent progress has been made in
this regard during the second quarter, building momentum towards completion of
the debt finance underwriting process in the fourth quarter.
New Ventures
FCP has received pre-qualification by ALNAFT for the upcoming licensing
round for oil and gas exploration acreage. FCP's pre-qualification will allow
participation as operator and investor for onshore permits. This is the
seventh Algerian licensing round since 2000, with 16 permits on offer across
many of the petroleum basins in the country, including the Berkine Basin where
FCP's prolific Block 405b is located. The bid round closes on December 17,
2008.
FINANCIAL REVIEW
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
Net loss $ 14,636 $ 1,613 $ 26,614 $ 4,010
The net loss for the quarter was $14.6 million, compared to $1.6 million
in 2007, primarily due to the onset of interest expense on the convertible
debentures issued in December 2007, and higher G&A costs as outlined below.
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
Interest Income $ 1,553 $ 1,502 $ 3,785 $ 2,493
Interest income for the quarter is even with 2007, but has increased for
the six month period over 2007 due to higher average cash and cash equivalent
balances on hand during comparable periods.
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
Interest Expense $ 8,066 $ - $ 16,139 $ -
Interest expense represents interest incurred on the $267 million
convertible debentures which were issued in December 2007. The debentures bear
interest at 9 percent, payable semi-annually, with the first interest payment
made May 29, 2008.
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
General and administrative $ 11,564 $ 4,394 $ 19,434 $ 8,616
Less capitalized amount (4,260) (1,108) (7,177) (2,366)
-------------------------------------------------------------------------
Expensed $ 7,304 $ 3,286 $ 12,257 $ 6,250
General and administrative costs have increased $6.0 million over the six
month period, due to increased staffing costs and professional fees required
to manage and operate the Algerian project, plus additional costs related to
the recent shareholder motions and resulting proxy contest. These latter costs
include executive severance and remuneration payments and a provision for
reimbursement of shareholder requisition meeting expenses.
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
Stock-based compensation $ 1,720 $ 2,144 $ 4,038 $ 3,155
Less capitalized amount (1,135) (1,303) (2,778) (2,081)
-------------------------------------------------------------------------
Expensed $ 585 $ 841 $ 1,260 $ 1,074
Stock-based compensation was lower in Q2 due to fewer option grants and
more cancellations but higher for the six months due to more options being
granted than prior year, with a corresponding increase in the amount of stock
based compensation capitalized.
Three months ended Six months ended
June 30 June 30
-------------------------------------------------------------------------
($ thousands) 2008 2007 2008 2007
-------------------------------------------------------------------------
Capital Expenditures
Exploration & Appraisal
-----------------------
Geological and geophysical $ 1,019 $ 891 $ 1,829 $ 1,669
Drilling, completion and testing 517 30,147 862 69,862
CAFC commercialization 420 - 723 -
Development
-----------
Geological and geophysical $ 266 $ 187 $ 710 $ 2,926
Drilling, completion and testing 14,945 56 34,656 153
MLE commercialization 5,921 3,365 14,615 7,670
----------------------------------------
$ 23,088 $ 34,646 $ 53,395 $ 82,280
Block management, administration
and corporate 3,892 3,858 6,786 7,131
----------------------------------------
Total capital expenditures $ 26,980 $ 38,504 $ 60,181 $ 89,411
Less non-cash expenditures
(stock-based compensation,
asset retirement provisions) 1,158 1,358 2,894 2,268
----------------------------------------
Net capital expenditures $ 25,822 $ 37,146 $ 57,287 $ 87,143
-------------------------------------------------------------------------
Capital expenditures are lower in 2008 over 2007 due to the greater level
of drilling activity of the appraisal drilling program in the first half of
2007. In 2008, FCP's focus has shifted from exploration and appraisal to a
development drilling focus. As well, in the first half of 2008, FCP used one
drilling rig compared to two rigs in the same period in 2007. MLE
commercialization costs are higher over prior period and prior year largely as
a result of the increased volume of development activity, including costs
associated with the finalization of the FEED study.
Liquidity and Capital Resources
First Calgary had $197.0 million of working capital on hand as at
June 30, 2008 compared with $274.1 million at the end of 2007. Cash balances
and short-term investments were $217.6 million at the end of the first half of
2008.
Development of the Ledjmet Block 405b reserves through to commercial
production will require significant funding, with 75 percent being FCP's
share. Development funding continues to focus on project debt. The gross
development cost of the MLE Field is currently estimated at approximately
$1.3 billion, and will mainly be incurred over the 2008 - 2010 period.
The Company is listed on the Toronto Stock Exchange and the AIM market of
the London Stock Exchange. The diluted numbers of shares outstanding at the
following dates were:
July 31, June 30, December 31,
2008 2008 2007
-------------------------------------------------------------------------
Common shares 254,939,030 254,939,030 254,619,030
Issuable on conversion of
debentures 63,571,428 63,571,428 63,571,428
Employee stock options 16,529,747 16,607,747 16,806,747
-------------------------------------------------------------------------
Diluted shares outstanding 335,040,205 335,118,205 334,997,205
-------------------------------------------------------------------------
Summary of Quarterly Results
2008 2007
-------------------------------------------------------------------------
Q2 Q1 Q4 Q3 Q2 Q1
-------------------------------------------------------------------------
Interest income $1,553 $2,232 $1,372 $1,511 $1,502 $991
Income (loss) (14,636) (11,978) (5,940) (1,745) (1,613) (2,397)
Income (loss)
per share (0.06) (0.05) (0.02) (0.01) (0.01) (0.01)
Total assets 1,022,233 1,034,599 1,031,916 788,554 775,867 643,642
-------------------------------------------------------------------------
2006
-----------------------------------
Q4 Q3
-----------------------------------
Interest income $1,633 $2,052
Income (loss) (19,706) (266)
Income (loss)
per share (0.09) 0.00
Total assets 650,053 649,354
-----------------------------------
The net loss in 2008 relates mainly to interest on the convertible debt
issued in December 2007, and general and administrative expenses.
CHANGE IN ACCOUNTING POLICIES
Financial Instruments - Recognition and Measurement
Two new Canadian accounting standards have been issued which required
additional disclosure in the Company's financial statements commencing
January 1, 2008, pertaining to the Company's use of financial instruments as
well as its capital and how it is managed. These standards have been adopted
in the Company's unaudited statements.
BUSINESS RISKS AND UNCERTAINTIES
The MD&A and Annual Information Form (AIF) for the year ended
December 31, 2007 includes an overview of certain business risks and
uncertainties facing the Company. Those risks remain in effect as at June 30,
2008.
ADVISORY REGARDING FORWARD-LOOKING STATEMENTS
Certain information with respect to the Company contained in this report,
including management's assessment of future plans and operations, contains
forward-looking statements. These forward-looking statements are based on
assumptions and are subject to numerous risks and uncertainties, some of which
are beyond FCP's control, including the timing and receipt of joint venture
and governmental approvals, the impact of general economic conditions,
industry conditions, volatility of commodity prices, currency exchange rate
fluctuations, reserve estimates, environmental risks, competition from other
explorers, stock market volatility and ability to access sufficient capital.
In addition, actual results may vary because FCP principally operates in
jurisdictions with less developed legal systems than in the case of more
established economies and relies on continuing existing strategic
relationships and forming new ones with other entities in the oil and gas
industry, such as joint venture parties and farm-in partners. FCP's actual
results, performance or achievement could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any events anticipated by the
forward-looking statements will transpire or occur.
Company Information
Additional information related to FCP, including the Company's Annual
Information Form, is available on FCP's website at www.fcpl.ca or on SEDAR's
website at www.sedar.com.
July 31, 2008
Consolidated Balance Sheets
As at As at
(in thousands of U.S. dollars) June 30, December 31,
(unaudited) 2008 2007
-------------------------------------------------------------------------
Assets
Current assets
Cash and cash equivalents $217,575 $275,270
Accounts receivable 723 1,222
Deposits and prepaid expenses 956 1,333
Other assets (note 2) 12,106 23,048
-------------------------------------------------------------------------
231,360 300,873
Property, plant and equipment 790,873 731,043
-------------------------------------------------------------------------
$1,022,233 $1,031,916
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities $34,382 $26,763
Convertible debentures (note 3) 226,746 222,589
Asset retirement obligations 3,526 3,225
Future income taxes 18,548 18,548
-------------------------------------------------------------------------
Shareholders' equity
Capital stock (note 4) 764,678 763,257
Contributed surplus (note 4) 29,388 25,955
Equity portion of convertible debentures
(note 3) 30,453 30,453
Accumulated other comprehensive income 6,502 6,502
Deficit (91,990) (65,376)
-------------------------------------------------------------------------
739,031 760,791
Operations and commitments (note 1)
-------------------------------------------------------------------------
$1,022,233 $1,031,916
-------------------------------------------------------------------------
See accompanying notes to consolidated financial statements.
Consolidated Statements of Operations and Deficit
(in thousands of U.S. dollars) Three months ended Six months ended
June 30, June 30,
(unaudited) 2008 2007 2008 2007
-------------------------------------------------------------------------
Revenue
Interest $1,553 $1,502 $3,785 $2,493
Expenses
Interest expense 8,066 - 16,139 -
General and administrative 7,304 3,286 12,257 6,250
Stock-based compensation (note 4) 585 841 1,260 1,074
Foreign exchange loss (gain) (37) (1,169) 205 (1,108)
Depreciation and accretion 271 157 538 287
-------------------------------------------------------------------------
16,189 3,115 30,399 6,503
Net loss and comprehensive loss
for the period (14,636) (1,613) (26,614) (4,010)
Deficit, beginning of period (77,354) (56,078) (65,376) (53,681)
-------------------------------------------------------------------------
Deficit, end of period $(91,990) $(57,691) $(91,990) $(57,691)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Loss per share (note 4)
Basic and diluted $(0.06) $(0.01) $(0.10) $(0.02)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
See accompanying notes to consolidated financial statements.
Consolidated Statements of Cash Flows
(in thousands of U.S. dollars) Three months ended Six months ended
June 30, June 30,
(unaudited) 2008 2007 2008 2007
-------------------------------------------------------------------------
Operating activities
Net loss for the period $(14,636) $(1,613) $(26,614) $(4,010)
Items not involving cash
Accretion on convertible
debentures 2,085 - 4,157 -
Stock-based compensation 585 841 1,260 1,074
Foreign exchange gain (422) (1,487) (653) (1,548)
Depreciation and accretion 271 157 538 287
-------------------------------------------------------------------------
(12,117) (2,102) (21,312) (4,197)
Change in non-cash working
capital 7,463 (624) 12,570 (1,243)
-------------------------------------------------------------------------
(4,654) (2,726) (8,742) (5,440)
Financing activities
Proceeds from issuance of shares - 135,671 - 135,671
Proceeds from exercise of options 768 1,142 816 1,281
Issue costs - (6,549) - (6,549)
-------------------------------------------------------------------------
768 130,264 816 130,403
Investing activities
Expenditures on property,
plant and equipment (25,822) (37,146) (57,287) (87,143)
Interest on restricted cash (53) - (72) -
Change in non-cash working
capital 2,236 514 7,275 (4,039)
-------------------------------------------------------------------------
(23,639) (36,632) (50,084) (91,182)
-------------------------------------------------------------------------
Change in cash and cash
equivalents (27,525) 90,906 (58,010) 33,781
Exchange rate fluctuations
on cash and cash equivalents 45 1,533 315 1,518
Cash and cash equivalents,
beginning of period 245,055 51,349 275,270 108,489
-------------------------------------------------------------------------
Cash and cash equivalents,
end of period $217,575 $143,788 $217,575 $143,788
-------------------------------------------------------------------------
-------------------------------------------------------------------------
See accompanying notes to consolidated financial statements
Notes to the Consolidated Financial Statements
Six months ended June 30, 2008 (unaudited)
(in thousands of U.S. dollars unless otherwise indicated)
These interim consolidated financial statements of First Calgary
Petroleums Ltd. (First Calgary, FCP or the Company) have been prepared by
management in accordance with accounting principles generally accepted in
Canada following the same accounting policies as the consolidated
financial statements for the year ended December 31, 2007. The
disclosures included below are incremental to those included with the
annual consolidated financial statements. The interim consolidated
financial statements should be read in conjunction with the consolidated
financial statements and the notes thereto for the year ended
December 31, 2007.
1. Operations and commitments:
First Calgary currently has the rights to appraise and develop Ledjmet
Block 405b (Block 405b) in Algeria. The Company's rights and obligations
on Block 405b are set out in a Production Sharing Contract (PSC) with
Sonatrach, the national oil company of Algeria. The nature of current
operations and the terms or commitments under the PSC are summarized
below.
The five year exploration period of the PSC ended on December 29, 2006.
All exploration work commitments under the PSC were completed.
FCP has retained two main acreage parcels for development, the MLE field
and the Central Area Field Complex (CAFC).
FCP received approval in February 2007 from the Algerian regulatory
authority ALNAFT for the development plan for the MLE oil and gas field
on Block 405b. The submission of a development plan for the remaining
appraisal was made early in third quarter 2008. Approval for the
development plan is expected prior to the end of 2008.
The first phase of the overall Block 405b development plan includes
construction of a gas plant and field gathering system and facilities
designed to produce up to 260 million cubic feet of sales gas per day
(MMCF/D) and 20 thousand barrels per day (MB/D) of associated natural gas
liquids and oil, on a gross basis. The initial gas sales volume agreed
with Sonatrach is for 200 million cubic feet per day of sales gas. Three
product pipelines are required to transport sales gas, condensate and LPG
products to the national grid system that lies 140 km to the west of the
block. A fourth product pipeline to transport an oil stream is
anticipated to tie into existing infrastructure within the Berkine Basin.
FCP and Sonatrach subsequently agreed to modify the design of the product
pipelines to accommodate increased volumes from the planned additional
development in the CAFC as part of an integrated block development
strategy. Current development plans are targeting up to 300 MMCF/D sales
of gas with up to 40 MB/D of liquids.
Gas marketing terms were agreed with Sonatrach in November 2006 and were
attached to the MLE development plan. The gas terms specify and clarify
the provisions of the PSC relating to the long-term marketing of
quantities of dry gas from Block 405b. It is proposed that the gas terms
will be incorporated into the long form Gas Agreement entered into
between the Company and Sonatrach. FCP has entrusted the marketing of all
gas from the 405b block to Sonatrach and in return will receive a well
head price net of transportation costs based on a southern European gas
pricing formula. FCP is in discussions with Sonatrach for all liquids
production from Block 405b to be marketed by Sonatrach. Liquids are
anticipated to be sold at international product prices less a marketing
fee. The long term Gas Agreement will be subject to certain conditions
precedent, including securing financing satisfactory to FCP, the
arrangement by Sonatrach of firm pipeline capacity downstream of the
point of transmission and the execution of certain collateral agreements
such as project contracts and liquids and condensate sales agreements.
The Front End Engineering and Design (FEED) work for the MLE gas plant,
pipeline and gathering systems was completed in December 2007. One of the
key deliverables of the FEED was to establish a cost estimate for the
plant facility and pipelines.
2. Other assets
Cash was placed in an escrow account equal to the first year's interest
payments on the convertible debentures. The funds are released to the
convertible debenture holders for 2008 interest payments. The Company
will use the remaining balance for the second interest payment in
November 2008.
3. Convertible debentures:
The following table sets forth a reconciliation of the convertible
debentures activity:
Liability Equity
Component Component
-------------------------------------------------------------------------
Balance, December 31, 2007 $222,589 $ 30,453
Accretion of non cash interest expense 4,157 -
-------------------------------------------------------------------------
Balance, June 30, 2008 $226,746 $ 30,453
-------------------------------------------------------------------------
Interest of $11,013,750 was paid during the period.
4. Capital stock:
(a) Issued share capital:
Number of
Shares Amount
-------------------------------------------------------------------------
Balance, December 31, 2007 254,619,030 $ 763,257
Issued on exercise of employee stock options 320,000 816
Transfer from contributed surplus on
exercise of stock options - 605
-------------------------------------------------------------------------
Balance, June 30, 2008 254,939,030 $ 764,678
-------------------------------------------------------------------------
(b) Employee stock options:
The Company has up to 10 percent of its issued and outstanding common
shares available for issuance pursuant to its Stock Option Plan. Stock
options granted under the plan have a term of five years and vesting
terms are determined at the discretion of the Board, ranging between two
and three years. The exercise price of each option is equal to the
closing market price of the shares on the date preceding the date of the
grant. The following table summarizes the changes in stock options
outstanding during the period ended June 30, 2008:
Weighted
Avg.
Number of Exercise
Options Price
-------------------------------------------------------------------------
Outstanding, December 31, 2007 16,806,747 C$ 4.90
Granted 2,770,000 2.79
Exercised (320,000) 2.60
Forfeited (2,649,000) 4.20
-------------------------------------------------------------------------
Outstanding, June 30, 2008 16,607,747 C$ 4.71
-------------------------------------------------------------------------
The following table summarizes information about the options outstanding
and exercisable at June 30, 2008:
Options Outstanding Options Exercisable
-----------------------------------------------------
Weighted
Average Weighted Weighted
Remaining Average Average
Range of Contractual Exercise Exercise
Exercise Price Options Life Price Options Price
-------------------------------------------------------------------------
C$ 2.78 - 2.98 6,579,667 4.6 years C$2.78 276,667 C$2.79
C$ 4.72 - 4.72 1,817,500 0.3 years 4.72 1,817,500 4.72
C$ 5.08 - 6.39 6,669,915 3.2 years 5.64 4,339,077 5.89
C$ 7.22 - 8.59 650,000 2.5 years 7.58 388,335 7.72
C$ 8.65 - 10.50 716,665 2.7 years 9.30 556,668 9.37
C$11.10 - 15.77 174,000 1.0 years 12.17 174,000 12.17
-------------------------------------------------------------------------
16,607,747 3.4 years C$4.71 7,552,247 C$5.99
-------------------------------------------------------------------------
-------------------------------------------------------------------------
For the six months ended June 30, 2008, the Company recorded $4.0 million
(2007 - $3.2 million) of stock-based compensation expense with a
corresponding increase in contributed surplus (three months ended
June 30, 2008 - $1.7 million; 2007 - $2.1 million). Of the total stock-
based compensation expense, the Company has capitalized $1.1 million and
$2.8 million for the three and six month periods ended June 30, 2008
(2007 - $1.3 million and $2.1 million respectively).
The fair value of the options granted in the three months ended June 30,
2008 was estimated to be C$1.25 (2007 - C$2.44) per option, and was
determined using the Black-Scholes option pricing model with the
following assumptions: expected volatility of 63 percent (2007 -
59 percent), risk-free interest rate of 3 percent (2007 - 3 percent),
and expected lives of 4 years (2007 - 4 years).
The fair value of the options granted in the six months ended June 30,
2008 was estimated to be C$1.28 (2007 - C$2.49) per option, and was
determined using the Black-Scholes option pricing model with the
following assumptions: expected volatility of 63 percent (2007 -
59 percent), risk-free interest rate of 3 percent (2007 - 3 percent),
and expected lives of 4 years (2007 - 4 years).
(c) Contributed surplus:
The changes in the contributed surplus balance are as follows:
($ thousands) 2008 2007
-------------------------------------------------------------------------
Balance, beginning of period $ 25,955 $ 19,186
Stock based compensation 4,038 3,155
Options exercised (605) (687)
-------------------------------------------------------------------------
Balance, end of period $ 29,388 $ 21,654
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(d) Per share amounts:
The loss per share is based on the weighted average shares outstanding
for the period. The basic and diluted weighted average shares outstanding
for the three and six months ended June 30, 2008 were 254,881,887 and
254,759,689 respectively (2007 - 246,479,389 and 235,214,160).
5. Financial instruments and capital
Fair Value
At June 30, 2008 and December 31, 2007 the carrying values of cash and
cash equivalents, accounts receivable, accounts payable and accrued
liabilities approximate their fair values due to their short terms to
maturity. The fair value of the convertible debentures at June 30, 2008
was approximately $267 million.
Foreign Currency Risk
The Company is exposed to foreign currency fluctuations as it holds
Canadian dollar, British pound, Euro and Algerian Dinar cash and short-
term deposits and accounts payable. In addition, a portion of the
Company's operating activities are conducted in Canadian dollars and the
Algerian Dinar. There are no exchange rate contracts in place.
The following balances are denoted in foreign currencies:
Canadian Algerian Pounds
(thousands) dollar dinar Euro sterling
-------------------------------------------------------------------------
June 30, 2008
Cash and cash equivalents 1,178 30,006 68 912
Less: Accounts payable 121 358,985 135 74
----------------------------------------
Net foreign exchange exposure 1,057 (328,979) (67) 838
December 31, 2007
Cash and cash equivalents 10,365 238,389 145 310
Less: Accounts payable 539 367,921 5 123
----------------------------------------
Net foreign exchange exposure 9,826 (129,532) 140 187
A change in the U.S. dollar compared to the currency in which the above
items are denominated results in an increase or decrease in foreign
exchange gains or losses. A change in the exchange rates would affect the
loss, holding all other variables constant, as follows:
Effect of a $0.01 exchange rate change:
U.S.- U.S.- U.S.- U.S.-
Canadian Dinar Euro Pounds
----------------------------------------
Change in the foreign exchange
gain (loss)
2008 $ 10 $ 53 $ 1 $ 17
Commodity Risk
FCP's net loss is not currently exposed to commodity risk, as the Company
is in the pre-production phase. The overall development of Block 405b is
exposed to oil, gas and NGL price risks as a significant decrease in
prices would affect the economic returns of the Company in the long run.
Interest Rate Risk
A significant portion of cash and cash equivalents is held in interest
bearing investments; a 100 basis point drop in interest rates would
decrease interest income in the quarter by approximately $230,000.
The convertible debentures bear fixed interest and therefore earnings are
not exposed to interest risk. The fair value of the debentures is
affected by changes in interest rates.
Credit Risk
Cash and cash equivalents and accounts receivable, which is predominantly
interest earned on cash and cash equivalents, are held in credit rated
institutions. Credit risk is assessed to be low given the financial
institutions that hold the funds.
Liquidity Risk
FCP maintains sufficient cash on hand to meet current and forecasted
commitments. Spending is increased or decreased to match available funds.
Capital Management
FCP's capital consists of funds raised through share and debenture
issues, and is used to fund the current operations of the Company. The
Company monitors forecasted spending, and will raise additional funds as
required. FCP is actively seeking project financing for the development
of Block 405b.
6. Segmented Information
The Company's activities are conducted in two geographic segments: Canada
and Algeria. All activities relate to exploration and development of
petroleum and natural gas in Algeria.
Three months ended June 30, 2008
($ thousands) Canada Algeria Total
-------------------------------------------------------------------------
Capital Expenditures
-------------------------------------------------------------------------
2008 $ 107 $ 25,715 $ 25,822
2007 $ 404 $ 36,742 $ 37,146
-------------------------------------------------------------------------
Six months ended June 30, 2008
($ thousands) Canada Algeria Total
-------------------------------------------------------------------------
Capital Expenditures
-------------------------------------------------------------------------
2008 $ 211 $ 57,076 $ 57,287
2007 $ 573 $ 86,570 $ 87,143
-------------------------------------------------------------------------
Total Assets
-------------------------------------------------------------------------
2008 $ 233,198 $ 789,035 $1,022,233
2007 $ 146,293 $ 629,574 $ 775,867
7. Commitments
As part of the development activity on Block 405b, the Company, through
its association with Sonatrach, has entered into contractual commitments
with various vendors, as follows:
- Line pipe orders for approximately $141 million; a $28 million
deposit is anticipated to be paid in the third quarter of 2008;
- Civil engineering work for field facilities for approximately
$35 million; and
- Construction of an office and residential facility in Hassi Messaoud
for approximately $16 million; a $1.6 million deposit is anticipated
to be paid in the third quarter of 2008.
As with other development costs, the Company's share is 75%, with
responsibility for the remaining 25% residing with Sonatrach
For further information: Patricia Lew-Lapointe, Manager, Investor Relations,
Tel: (403) 450-2030; Other Contacts: James Henderson, Pelham Public Relations,
Tel: +44 (0)20 7743 6673; Nominated Advisers: Richard Swindells/David Nabarro,
Nabarro Wells & Co. Limited, Tel: +44 (0)20 7634 4705
(FPL.)
END
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