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For the quarter ended
For the year ended
Financial Highlights
Production
For the fourth quarter of 2012, net production was 540,558 barrels of oil, 366,258 thousand cubic feet ("MCF") of natural gas and 289,728 gallons of natural gas liquids ("NGL"), or 608,499 BOE. Net production for the fourth quarter of 2012 by region was 293,906 BOE at
Realized price for the fourth quarter of 2012 including transportation costs was
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| PRODUCTION SCHEDULE | ||||
| (Unaudited) | ||||
| Production Volumes: | 4Q2012 | 4Q2011 | 2012 | 2011 |
| Oil (MBbls) | 540.6 | 617.9 | 2,323.4 | 2,128.1 |
| Natural Gas (MMcf) | 366.3 | 186.3 | 1,107.7 | 878.1 |
| NGL (MGal) | 289.7 | 535.4 | 2,714.1 | 2,468.5 |
| Oil equivalents (MBOE) | 608.5 | 661.7 | 2,572.6 | 2,333.2 |
| Average Realized Price: | ||||
| Oil (per Bbl) |
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| Natural Gas (per Mcf) |
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| NGL (per Gal) |
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| Oil equivalents (BOE) |
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Year-End 2012 Reserves
Gulfport reported year-end 2012 total proved reserves of 13.88 million BOE, consisting of 8.25 million barrels of oil ("MMBBL"), which includes natural gas liquids, and 33.77 billion cubic feet ("BCF") of natural gas. In addition, Gulfport's third party engineers estimated Gulfport's year-end 2012 probable reserves to be 12.84 million barrels of oil and 80.62 billion cubic feet of natural gas, or 26.27 million BOE. At year-end 2012, 59.8% of Gulfport's proved reserves were classified as proved developed reserves. Giving pro forma effect to Gulfport's contribution of all of its oil and gas interests in the
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| (Unaudited) | |||
| Oil | Natural Gas | Oil Equivalent | |
| MMBBL | BCF | MMBOE | |
| Proved Developed Producing | 1.88 | 4.95 | 2.70 |
| Proved Developed Non-Producing | 3.34 | 13.53 | 5.60 |
| Proved Undeveloped | 3.03 | 15.29 | 5.58 |
| Total Proved Reserves | 8.25 | 33.77 | 13.88 |
| Probable Reserves | 12.84 | 80.62 | 26.27 |
| Total Proved and Probable Reserves | 21.09 | 114.39 | 40.15 |
In accordance with
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| (Unaudited) | |||
| SEC Case | Flat Price Case¹ | NYMEX Case² | |
| ($MM) | ($MM) | ($MM) | |
| Proved Developed Producing |
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| Proved Developed Non-Producing |
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| Proved Undeveloped |
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| Total Proved Reserves |
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| Probable Reserves |
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| Total Proved and Probable Reserves |
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¹The Flat Price Case was based on the posted spot prices as of |
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For oil and natural gas liquids, the West Texas Intermediate posted price of |
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| lease for quality, transportation fees and regional price differentials. For natural gas, the Henry Hub spot price of | |||
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| Such prices were held constant throughout the estimated lives of the reserves. | |||
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²The NYMEX Case was based on the forward closing prices on the |
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natural gas as of |
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which decreased from |
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| by lease for quality, transportation fees and regional price differentials. For natural gas, the price was based on | |||
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a natural gas price which increased from |
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| and was adjusted by lease for energy content, transportation fees and regional price differentials. | |||
Grizzly Oil Sands Reserves and Resource
Effective
The following table summarizes GLJ's determination of Grizzly's reserves and resources effective
| Reserves and Resources |
Grizzly Working Interest Recoverable Volumes (Millions of Barrels) |
| Proved Reserves | 67 |
| Probable Reserves | 71 |
| Proved + Probable (2P) Reserves | 138 |
| Best Estimate (P50) Contingent Resource | 3,060 |
The GLJ reserve and resource assessment report was prepared in accordance with National Instrument 51-101 using the best practices detailed in the Canadian Oil and Gas Evaluation Handbook. For important qualifications and limitations relating to these oil sands reserves and resources, please see "Oil Sands Reserves & Resources Notes" below.
Recent Operational Highlights
Operational Update
In the
Canadian Oil Sands
In the Canadian Oil Sands, Grizzly is currently conducting a well delineation program at
As previously announced, Grizzly has entered into a memorandum of understanding that outlines the rate structure for a 10 year agreement with Canadian National Railway Company ("CN") to transport its bitumen to the
At the
At WCBB, Gulfport drilled 31 wells, completing 27 wells as productive during 2012. In addition, Gulfport performed 61 recompletions at the field. At present, Gulfport has one rig active at WCBB and is drilling ahead on the first well of 2013.
Presentation
An updated presentation will be posted to the Company's website tomorrow morning. The presentation can be found at www.gulfportenergy.com under the "Webcasts & Presentations" section on the "Investor Relations" page. Information on the Company's website does not constitute a portion of this press release.
2013 Guidance
Gulfport estimates 2013 production to be in the range of 7.8 million to 8.1 million BOE. Capital expenditures for drilling activities and infrastructure projects during 2013 are estimated to be in the range of
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| 2013 GUIDANCE | |
| Year Ending | |
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| Forecasted Production | |
| Oil Equivalent - BOE | 7,800,000 - 8,100,000 |
| Average Daily Oil Equivalent - BOEPD | 21,370 - 22,192 |
| Projected Year-Over-Year Production Increase¹ | 203% - 205% |
| Projected Cash Operating Costs per BOE | |
| Lease Operating Expense - $/BOE |
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| Production Taxes - % of Revenue | 8.0% - 9.0% |
| General and Administrative - $/BOE |
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| Depreciation, Depletion and Amortization per BOE |
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| Budgeted Capital Expenditures - In Millions:² | |
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| Utica |
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| Grizzly |
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| Total Budgeted E&P Capital Expenditures |
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| ¹ Based upon 2012 actual production of 2.573 million BOE and the 2013 forecasted production | |
| ² Excludes amounts for infrastructure, vertical integration projects and acquisitions | |
Conference Call
Gulfport will host a conference call on
About Gulfport
Forward Looking Statements
This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Gulfport expects or anticipates will or may occur in the future, including such things as Gulfport's future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strength, goals, expansion and growth of Gulfport's business and operations, plans, market conditions, references to future success, reference to intentions as to future matters and other such matters are forward-looking statements. These statements are based on certain
assumptions and analyses made by Gulfport in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances. However, whether actual results and developments will conform with Gulfport's expectations and predictions is subject to a number of risks and uncertainties, general economic, market, credit or business conditions; the opportunities (or lack thereof) that may be presented to and pursued by Gulfport; competitive actions by other oil and gas companies; changes in laws or regulations; completion of Gulfport's pending contribution discussed above and other factors, many of which are beyond the control of Gulfport. Information concerning these and other factors can be found in the Company's filings with the
Non-GAAP Financial Measures
EBITDA is a non-GAAP financial measure equal to net income, the most directly comparable GAAP financial measure, plus interest expense, income tax expense (benefit), accretion expense and depreciation, depletion and amortization. Cash flow from operating activities before changes in operating assets and liabilities is a non-GAAP financial measure equal to cash provided by operating activities before changes in operating assets and liabilities. Adjusted net income available is a non-GAAP financial measure equal to net income plus income tax expense. The Company has presented EBITDA because it uses EBITDA as an integral part of its internal reporting to measure its performance and to evaluate the performance of its senior management. EBITDA is considered an important indicator of the operational strength of the Company's business. EBITDA eliminates the uneven effect of considerable amounts of non-cash depletion, depreciation of tangible assets and amortization of certain intangible assets. A limitation of this measure, however, is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the Company's business. Management evaluates the costs of such tangible and intangible assets and the impact of related impairments through other financial measures, such as capital expenditures, investment spending and return on capital. Therefore, the Company believes that EBITDA provides useful information to its investors regarding its performance and overall results of operations. EBITDA, and cash flow from operating activities before changes in operating assets and liabilities are not intended to be performance measures that should be regarded as an alternative to, or more meaningful than, either net income as an indicator of operating performance or to cash flows from operating activities as a measure of liquidity. In addition, EBITDA and cash flow from operating activities before changes in operating assets and liabilities are not intended to represent funds available for dividends, reinvestment or other discretionary uses, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The EBITDA and cash flow from operating activities before changes in operating assets and liabilities presented in this press release may not be comparable to similarly titled measures presented by other companies, and may not be identical to corresponding measures used in the Company's various agreements.
Oil Sands Reserves and Resource Notes:
(1) Proved reserves are defined in the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") as those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated Proved reserves.
(2) Probable reserves are defined in the COGE Handbook as those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.
(3) Contingent Resources are defined in the COGE Handbook as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies.
(4) Prospective Resources are defined in the COGE Handbook as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects.
(5) Best Estimate as defined in the COGE Handbook is considered to be the best estimate of the quantity that will actually be recovered from the accumulation. If probabilistic methods are used, this term is a measure of central tendency of the uncertainty distribution (P50).
(6) It should be noted that reserves, Contingent Resources and Prospective Resources involve different risks associated with achieving commerciality. There is no certainty that it will be commercially viable for Grizzly to produce any portion of the Contingent Resources. There is no certainty that any portion of Grizzly's Prospective Resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the Prospective Resources. Grizzly's Prospective Resource estimates discussed in this press release have been risked for the chance of discovery but not for the chance of development and hence are considered by Grizzly as partially risked estimates.
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| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (Unaudited) | ||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||
| 2012 | 2011 | 2012 | 2011 | |
| Revenues: | ||||
| Oil and condensate sales | $ 55,075,000 | $ 67,466,000 | $ 242,708,000 | $ 222,025,000 |
| Gas sales | 1,098,000 | 683,000 | 3,225,000 | 3,838,000 |
| Natural gas liquids sales | 294,000 | 744,000 | 2,668,000 | 3,090,000 |
| Other income | 136,000 | 53,000 | 325,000 | 301,000 |
| 56,603,000 | 68,946,000 | 248,926,000 | 229,254,000 | |
| Costs and expenses: | ||||
| Lease operating expenses | 6,107,000 | 5,794,000 | 24,308,000 | 20,897,000 |
| Production taxes | 6,989,000 | 7,813,000 | 29,400,000 | 26,333,000 |
| Depreciation, depletion, and amortization | 20,325,000 | 21,714,000 | 90,749,000 | 62,320,000 |
| General and administrative | 4,438,000 | 1,865,000 | 13,808,000 | 8,074,000 |
| Accretion expense | 169,000 | 175,000 | 698,000 | 666,000 |
| Gain on sale of assets | (7,300,000) | -- | (7,300,000) | -- |
| 30,728,000 | 37,361,000 | 151,663,000 | 118,290,000 | |
| INCOME FROM OPERATIONS | 25,875,000 | 31,585,000 | 97,263,000 | 110,964,000 |
| OTHER (INCOME) EXPENSE: | ||||
| Interest expense | 5,828,000 | 237,000 | 7,458,000 | 1,400,000 |
| Interest income | (35,000) | (47,000) | (72,000) | (186,000) |
| (Income) loss from equity method investments | (10,115,000) | 512,000 | (8,322,000) | 1,418,000 |
| (4,322,000) | 702,000 | (936,000) | 2,632,000 | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 30,197,000 | 30,883,000 | 98,199,000 | 108,332,000 |
| INCOME TAX EXPENSE (BENEFIT) | 10,849,000 | (91,000) | 26,363,000 | (90,000) |
| INCOME FROM CONTINUING OPERATIONS | 19,348,000 | 30,974,000 | 71,836,000 | 108,422,000 |
| DISCONTINUED OPERATIONS | ||||
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Loss on disposal of |
3,465,000 | -- | 3,465,000 | -- |
| NET INCOME | $ 15,883,000 | $ 30,974,000 | $ 68,371,000 | $ 108,422,000 |
| NET INCOME PER COMMON SHARE: | ||||
| Basic net income from continuing operations per share | $ 0.34 | $ 0.59 | $ 1.28 | $ 2.22 |
| Basic net income from discontinued operations, net of tax, per share | (0.06) | -- | (0.06) | -- |
| Basic net income per share | $ 0.28 | $ 0.59 | $ 1.22 | $ 2.22 |
| Diluted net income from continuing operations per share | $ 0.34 | $ 0.59 | $ 1.27 | $ 2.20 |
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Diluted net income from discontinued operations, net of tax, per share |
(0.06) | -- | (0.06) | -- |
| Diluted net income per share | $ 0.28 | $ 0.59 | $ 1.21 | $ 2.20 |
| Basic weighted average shares outstanding | 56,751,919 | 52,331,045 | 55,933,354 | 48,754,840 |
| Diluted weighted average shares outstanding | 57,248,931 | 52,814,781 | 56,417,488 | 49,206,963 |
| GULFPORT ENERGY CORPORATION | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (Unaudited) | ||
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| 2012 | 2011 | |
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 167,088,000 | $ 93,897,000 |
| Accounts receivable - oil and gas | 25,615,000 | 28,019,000 |
| Accounts receivable - related parties | 34,848,000 | 4,731,000 |
| Prepaid expenses and other current assets | 1,506,000 | 1,327,000 |
| Short-term derivative instruments | 664,000 | 1,601,000 |
| Total current assets | 229,721,000 | 129,575,000 |
| Property and equipment: | ||
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Oil and natural gas properties, full-cost accounting, |
1,611,090,000 | 1,035,754,000 |
| Other property and equipment | 8,662,000 | 8,024,000 |
| Accumulated depletion, depreciation, amortization and impairment | (665,884,000) | (575,142,000) |
| Property and equipment, net | 953,868,000 | 468,636,000 |
| Other assets: | ||
| Equity investments | 381,484,000 | 86,824,000 |
| Other assets | 13,295,000 | 5,123,000 |
| Total other assets | 394,779,000 | 91,947,000 |
| Deferred tax asset | -- | 1,000,000 |
| Total assets | $ 1,578,368,000 | $ 691,158,000 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Accounts payable and accrued liabilities | $ 110,244,000 | $ 43,872,000 |
| Asset retirement obligation - current | 60,000 | 620,000 |
| Short-term derivative instruments | 10,442,000 | -- |
| Current maturities of long-term debt | 150,000 | 141,000 |
| Total current liabilities | 120,896,000 | 44,633,000 |
| Asset retirement obligation - long-term | 13,215,000 | 12,033,000 |
| Deferred tax liability | 18,607,000 | -- |
| Long-term debt, net of current maturities | 298,888,000 | 2,142,000 |
| Other non-current liabilities | 354,000 | -- |
| Total liabilities | 451,960,000 | 58,808,000 |
| Commitments and contingencies | ||
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Preferred stock, |
-- | -- |
| Stockholders' equity: | ||
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Common stock - |
674,000 | 556,000 |
| Paid-in capital | 1,036,245,000 | 604,584,000 |
| Accumulated other comprehensive income (loss) | (3,429,000) | 2,663,000 |
| Retained earnings | 92,918,000 | 24,547,000 |
| Total stockholders' equity | 1,126,408,000 | 632,350,000 |
| Total liabilities and stockholders' equity | $ 1,578,368,000 | $ 691,158,000 |
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Reconciliation of EBITDA and |
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| (Unaudited) | ||||
| Three Months Ended | Twelve Months Ended | |||
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| Net income | $ 15,883,000 | $ 30,974,000 | $ 68,371,000 | $ 108,422,000 |
| Interest expense | 5,828,000 | 237,000 | 7,458,000 | 1,400,000 |
| Income tax expense (benefit) | 8,612,000 | (91,000) | 24,126,000 | (90,000) |
| Accretion expense | 169,000 | 175,000 | 698,000 | 666,000 |
| Depreciation, depletion and amortization | 20,325,000 | 21,714,000 | 90,749,000 | 62,320,000 |
| EBITDA | $ 50,817,000 | $ 53,009,000 | $ 191,402,000 | $ 172,718,000 |
| Three Months Ended | Twelve Months Ended | |||
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| Cash provided by operating activities | $ 33,282,000 | $ 36,092,000 | $ 199,158,000 | $ 158,138,000 |
| Adjustments: | ||||
| Changes in operating assets and liabilities | 2,226,000 | 17,734,000 | (20,343,000) | 15,456,000 |
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Operating |
$ 35,508,000 | $ 53,826,000 | $ 178,815,000 | $ 173,594,000 |
CONTACT: Investor & Media Contact:
Paul K. Heerwagen
Director, Investor Relations
pheerwagen@gulfportenergy.com
405-242-4888
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