Gulf Oil and Gas accountACCOUNT

Lonestar Announces Third Quarter 2020 Results

Source: www.gulfoilandgas.com 11/19/2020, Location: North America

Lonestar Resources US Inc.reported financial and operating results for the three months ended September 30, 2020.

HIGHLIGHTS
- Lonestar reported an 8% increase in net oil and gas production to 14,419 BOE/d during the three months ended September 30, 2020 (“3Q20”), compared to 13,339 BOE/d for the three months ended June 30, 2020 (“2Q20”). Production was comprised of 73% crude oil and NGL’s on an equivalent basis.
- Lonestar reported a net loss attributable to its common stockholders of $38.5 million during 3Q20 compared to a net loss of $42.9 million during 2Q20. Excluding, on a tax-adjusted basis, certain items that the Company does not view as either recurring or indicative of its ongoing financial performance, Lonestar’s adjusted net income for 3Q20 was $23.0 million. Most notable among these items include: a $48.4 million change in unrealized (non-cash) hedging loss on financial derivatives (‘mark-to-market’) and $12.4 million of non-recurring G&A expense related to restructuring expenses. Please see Non-GAAP Financial Measures at the end of this release for the definition of Adjusted Net Income (Loss), a reconciliation of net income (loss) before taxes to Adjusted Net Income (Loss), and the reasons for its use.
- Lonestar reported Adjusted EBITDAX for 3Q20 of $32.5 million. On a sequential basis, Adjusted EBITDAX remained flat due to stringent cost management and substantial hedging. Please see Non-GAAP Financial Measures at the end of this release for the definition of Adjusted EBITDAX, a reconciliation of net (loss) income attributable to common stockholders to Adjusted EBITDAX, and the reasons for its use.

OPERATIONAL UPDATE
- Production- Lonestar reported an 8% increase in net oil and gas production to 14,419 BOE/d during the three months ended September 30, 2020. 3Q20 production volumes consisted of 7,190 barrels of oil per day (50%), 3,325 barrels of NGLs per day (23%), and 23,424 Mcf of natural gas per day (27%). This increase was attributable to Q2 shut-ins and the Hawkeye 14H-16H coming online.
- Wellhead Pricing- Lonestar’s wellhead crude oil price realization was $37.08/Bbl, which reflects a discount of $3.86/Bbl vs. WTI. Lonestar’s realized NGL price was $10.47/Bbl, or 26% of WTI. Lonestar’s realized wellhead natural gas price was $2.03 per Mcf, reflecting a $0.03 premium to Henry Hub.
- Revenues- Wellhead revenues improved by $14.9 million to $32.1 million, or 86%, compared to the three months ended June 30, 2020 (“2Q20”), primarily driven by a 80% increase in oil price realizations and a 59% increase in NGL price realizations, partially offset by a 29% decrease in natural gas price realizations.
- Expenses- In response to the downturn in oil and gas prices in 2020, Lonestar has made an organization-wide effort to reduce operating costs, focused on a combination of streamlining internal processes and seeking cost reductions from its vendors and service providers. Those organizational expense reductions are beginning to be reflected in the Company’s financial results. In the third quarter of 2020, total cash expenses, which include the cash portions of lease operating, gathering, processing, transportation, production taxes, general & administrative and interest expenses were $35.0 million for 3Q20, which reflects a 58% increase compared to $22.1 million in 2Q20. On a per-unit basis total cash expenses for 3Q20 and 2Q20 were $26.42 and $17.60, respectively. Excluding the incremental professional fees of $12.4 million incurred related to our restructuring, total cash expenses were $22.6 million for 3Q20, representing a 2% increase from the previous quarter. On a per-unit basis, 3Q20 total cash expenses per BOE were reduced by 4%, from $17.60 / BOE in 2Q20 to $17.07 / BOE in 3Q20.
- Lease Operating Expenses (“LOE”), excluding rig standby costs of $0.2 million, were $4.8 million for 3Q20, which was 18% higher than LOE of $4.0 million in 2Q20. On a unit-of-production basis, LOE per BOE increased 8% quarter over quarter to $3.59 per BOE in 3Q20. Increased LOE was driven entirely by the fact that Lonestar produced at 100% of capacity in 3Q20 after shutting in a substantial portion of its production in 2Q20.
- Gathering, Processing & Transportation Expenses (“GP&T”) for 3Q20 were $1.9 million, which was 116% higher than the GP&T of $0.9 million in the three months ended 2Q20. On a unit-of-production basis, GP&T increased 98% quarter over quarter from $0.72 per BOE in 2Q20 to $1.43 per BOE in 3Q20.
- Production and ad valorem taxes for 3Q20 were $2.0 million, which was 17% higher than production taxes of $1.7 million in 2Q20. On a unit-of-production basis, production and ad valorem taxes increased 6% quarter over quarter from $1.42 per BOE in 2Q20 to $1.50 per BOE in 3Q20. Increased production and ad valorem taxes were a function of higher wellhead revenues.
- General & Administrative Expenses (“G&A”) in 3Q20 were $15.8 million vs. $5.9 million in 2Q20. The significant increase was primarily due to incremental professional fees incurred related to our restructuring, totaling $12.4 million for the quarter. Excluding stock-based compensation, on a unit-of-production basis, G&A per BOE increased 177% quarter over quarter from $4.87 per BOE in 2Q20 to $11.92 per BOE in 3Q20. Excluding professional fees of $12.4 million related to restructuring, G&A per BOE decreased 40% quarter over quarter from $4.87 per BOE in 2Q20 to $2.57 per BOE in 3Q20.
- Interest expense was $11.4 million for 3Q20 vs. $10.5 million for 2Q20. Excluding amortization of debt issuance cost, premiums, and discounts, Interest expense increased 9% quarter over quarter from $9.9 million in 2Q20 to $10.8 million in 3Q20. On a unit-of-production basis, interest expense per BOE decreased 0.5% from $8.16 per BOE in 2Q20 to $8.12 per BOE in 3Q20.

EAGLE FORD SHALE TREND - WESTERN REGION
In our Western Region, production for 3Q20 averaged approximately 7,961 BOE per day, a 2% increase from 2Q20 production. Production consisted of 2,756 barrels of oil per day (35%), 2,367 barrels of NGL’s per day (30%) and 17,027 Mcf of natural gas per day (36%). The Western Region accounted for 55% of the Company’s production during the quarter. No new wells were completed during 3Q20. However, production increased in 3Q20 after the Company returned all of its wells to full production after shutting in certain wells during 2Q20 in reaction to historically low prices.

EAGLE FORD SHALE TREND - CENTRAL REGION
In our Central Region, 3Q20 production averaged approximately 6,242 BOE/d, a 18% increase compared to 2Q20 rates. Production consisted of 4,339 barrels of oil per day (70%), 893 barrels of NGL’s per day (14%), and 6,060 Mcf of natural gas per day (16%). The increase in production was largely driven by the shut-in of crude oil production volumes all of our wells in Gonzales, Karnes, Fayette and Lavaca Counties. The Central Region accounted for 43% of the Company’s production during the quarter.

In June, Lonestar began flowback operations on the Hawkeye #14H, Hawkeye #15H, and Hawkeye #16H. These recorded maximum rates over a 30-day period (“Max-30 rates”) of 1,461 BOE/d, 86% of which was crude oil. Now, through their first 120 days of production, these wells have produced an average of 111,000 barrels of crude oil.

- Hawkeye #14H – With a 10,979’ perforated interval, the #14H recorded Max-30 rates of 1,186 Bbls/d oil, 87 Bbls/d of NGLs, and 625 Mcf/d, or 1,377 BOE/d on a three-stream basis and was achieved on a 30/64” choke. The #14H well has been onstream for more than 4 months now, and 120-day rates have averaged 868 Bbls/d oil, 49 Bbls/d of NGLs, and 353 Mcf/d, or 976 BOE/d on a three-stream basis.
- Hawkeye #15H – With a 10,608’ perforated interval, the #14H recorded Max-30 rates 1,372 Bbls/d oil, 101 Bbls/d of NGLs, and 729 Mcf/d, or 1,595 BOE/d on a three-stream basis and was achieved on a 30/64” choke. The #15H has been onstream for more than 4 months now, and 120-day rates of 970 Bbls/d oil, 55 Bbls/d of NGLs, and 394 Mcf/d, or 1,090 BOE/d on a three-stream basis and was achieved on a 30/64” choke.
- Hawkeye #16H – With a 9,885’ perforated interval, the #16H recorded Max-30 rates 1,217 Bbls/d oil, 88 Bbls/d of NGLs, and 635 Mcf/d, or 1,411 BOE/d on a three-stream basis and was achieved on a 30/64” choke. The #16H has been onstream for more than 4 months now, and 120-day rates of 958 Bbls/d oil, 53 Bbls/d of NGLs, and 381 Mcf/d, or 1,074 BOE/d on a three-stream basis and was achieved on a 30/64” choke.
- The Company holds a 50% working interest (“WI”) / 38% net revenue interest (“NRI”) in these wells.

In July, the Company completed drilling operations on the Hawkeye #33H, Hawkeye #34H, and Hawkeye #35. These wells were drilled to total measured depths of 20,500, 20,358 feet, and 20,467, respectively, and are expected to have perforated intervals averaging approximately 10,800 feet. These wells are currently held in inventory as Drilled Uncompleted (DUC’s). Lonestar expects to hold a 50% WI / 37.5% NRI in these wells.

EAGLE FORD SHALE TREND - EASTERN REGION
In our Eastern Region, 3Q20 production averaged approximately 216 BOE/d, a 4% decrease over 2Q20 rates. Production consisted of 95 barrels of oil per day (44%), 65 barrels of NGL’s per day (30%), and 337 Mcf of natural gas per day (26%). The Eastern Region accounted for 2% of the Company’s production during the quarter.

Oil Shale News in United States >>

United States >>  1/22/2021 - Worley has been awarded four master services agreements by subsidiaries of Cheniere Energy, Inc. (Cheniere) to provide engineering, procurement, cons...




United States Oil & Gas 1 >>  2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 | 28 | 29 | 30 | 31 | 32 | 33 | 34 | 35 | 36 | 37 | 38 | 39 | 40 | 41 | 42 | 43 | 44 | 45 | 46 | 47 | 48 | 49 | 50 | 51 | 52 | 53 | 54 | 55 | 56 | 57 | 58 | 59 | 60 | 61 | 62 | 63 | 64 | 65 | 66 | 67 | 68 | 69 | 70 | 71 | 72 | 73 | 74 | 75 | 76 | 77 | 78 | 79 | 80 | 81 | 82 | 83 | 84 | 85 | 86 | 87 | 88 |

More News

Related Links

Gulf Oil and Gas
Copyright © 2020 Universal Solutions All rights reserved. - Terms of Service - Privacy Policy.