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Athabasca Oil Reports Solid Second Quarter Results

Recently, Athabasca Oil Corporation showed positive second quarter results, while commenting on the Dover Put process. ATH divulged that they and Dover mutually agreed on a way of closing and comprised timelines. Delays were not caused by a discussed $48.75 million indemnification, which was for reclamation work on legacy O&G wells in the region, as was declared this quarter.
A production of 5.78 million barrels of oil per day in the second quarter came in above estimates and in line with consensus. Third-party outages causing 1,000 BOE per day went longer than initially predicted, yet production was good. Guidance in the latter half of 2014 is 6,000 to 6,500 million barrels of oil per day and winter drilling should influence 2015. Expenses, both general and administrative, were reduced to $11.9 million. This was down from first quarter, though an increase is expected with the 2015 beginning of Hangingstone.

“Saturated” Duvernay wells’ extended rates are optimistic, with 785 BOE per day and 616 BOE per day restricted IP30s. Wells that were drilled before maintained production at 626 barrels of oil per day IP90 and 1,286 BOE per day IP60.

Remaining forecast at $261 million, net cash outlays to the end of the year include more or less $218 million on capex, with $21.75 million in net outflows from interest and both general and administrative expenses, counterbalanced by the light oil segment. Spending of the 66% of capex is predicted for the third quarter. The “Sector Perform” rating holds, while the target is lowered moderately from $9.60 to $9.10 per share.

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