Alpine Summit Energy Partners, Inc. is pleased to announce its financial and operating results for the year ended December 31, 2022. Alpine Summit's audited consolidated financial statements and notes, as well as management's discussion and analysis (the "MD&A") and its Annual Report on Form 10-K for the year ended December 31, 2022 will be available under the Company's issuer profile at "www.sedar.com" and "www.sec.gov/edgar", as well as on the Company's website at "www.alpinesummitenergy.com".
Craig Perry, Chief Executive Officer, remarked: "The fourth quarter of 2022 marked another significant step in production growth; however, subsequent to the end of the quarter a variety of factors has made maintaining our previous rate of growth and development pace untenable. Despite a significant hedge portfolio and new well performance in line with expectations, the combination of a historic fall in natural gas prices, a difficult financing environment, and inflation in the services sector has made a strategic review necessary. Accordingly, other than completing existing in-process wells the Company expects to pause field activity until the completion of its sale process. As previously announced we have engaged Stephens Inc. to complete a sale, focused on our South Texas proven assets, which represents a significant portion of the Company's production. We still anticipate this process to be completed prior to the end of the second quarter of 2023.
"Further, in light of the absence of basic credit availability, the Company reached agreements with both of its primary lender groups to facilitate its asset sale process. The continued departure of lenders from the oil and gas sector means that there is not currently a reliable source of financing for newly developed assets that aligns with our prior development pace. Accordingly, following the conclusion of the sale process and discussions with our key stakeholders, the Company expects to complete a strategic review of the activities of the Company. We look forward to communicating the Company's specific go-forward plans at the conclusion of this process."
2022 Highlights Financial, Business and Operational Highlights
• Oil and natural gas sales (net of royalties) of $195.6 million for the year ended December 31, 2022 (December 31, 2021 - $70.8 million).
• Reported net income and comprehensive income of $44.4 million for the year ended December 31, 2022 (December 31, 2021 - loss of $32.6 million). Adjusted EBITDA[1] (defined below) of $140.1 million for the same period (December 31, 2021 - $46.2 million).
• Reported net income attributable to the Company's common shareholders of $7.4 million for the year ended December 31, 2022 (December 31, 2021 - loss of $32.3 million).
• 18 new wells were brought onto production during 2022.
• For the three months ended December 31, 2022, Alpine had 30.9 net wells (37 gross wells) with a net production rate of 14,445 BOE per day (gross production rate of 22,588 BOE per day).
• Average net production per day of 10,513 BOE during 2022 (gross production rate of 16,145 BOE per day) an increase of 156% year over year due to extensive drilling activity.
• Development projects continued to be funded via the development partnership structures, to facilitate continued drilling initiatives.
• Entered into an asset-backed securitization facility covering a subset of producing oil and gas wells for total borrowings of $135 million. As of December 31, 2022, approximately $110 million was outstanding on the ABS Facility.
• Expanded the size of the Corporate Credit Facility to a maximum size of $65 million. As of December 31, 2022, $41.5 million was drawn under the Corporate Credit Facility.
• Listing on the Nasdaq Stock Market of the Company's Class A Subordinate Voting Shares on September 28, 2022, trading under the ticker symbol "ALPS".
• Implemented a dividend distribution policy, starting January 2022, where monthly dividends of $0.03 per share for each of the subordinated voting shares and proportionate voting shares and $3.00 per each share of the multiple voting shares were declared each month, with aggregate dividends declared and paid in 2022 of $12,416,759 (2021 - $nil).
Development Update & 2023 Objectives
During 2023, the Company plans on continuing to manage production of its primary assets in the Giddings and Hawkville fields. As previously disclosed, the Company expects to bring seven wells onto production by the end of the first quarter of 2023, with a pause in activity until the sales process is complete.
The Board has formed a sub-committee, led by Independent Directors, to lead discussions with the various stakeholders of the Company as it assesses alternatives following the conclusion of the sales process.
The Company is also terminating the previously announced automatic share purchase plan under its normal course issuer bid ("NCIB"), which commenced on June 10, 2022 and will conclude on the earlier of the date on which purchases under the NCIB have been completed and June 9, 2023.
