CALGARY, ALBERTA (August 13, 2021) – Touchstone Exploration Inc. ( ” Touchstone “, “we”, “our”, “us” or the ” Company ” ) (TSX, LSE: TXP) reports its operating and financial results for the three months ended June 30, 2021.
Selected information is outlined below and should be read in conjunction with Touchstone’s June 30, 2021 unaudited interim consolidated financial statements and related Management’s discussion and analysis, both of which will be available under the Company’s profile on SEDAR (www.sedar.com) and the Company’s website (www.touchstoneexploration.com). Unless otherwise stated, all financial amounts herein are stated in United States dollars .
Operational and Financial Highlights
· Achieved quarterly crude oil sales of 1,402 barrels per day (“bbls/d”), an 8 percent increase relative to the preceding quarter and consistent relative to the 1,396 bbls/d produced in the same period of 2020.
· Despite COVID-19 challenges in Trinidad, executed an incident free $6,664,000 exploration program, primarily focused on Cascadura Deep-1 and Chinook-1 well production testing, Royston-1 lease and drilling expenditures, and the Royston area seismic program.
· Realized crude oil prices averaged $59.06 per barrel, representing a 13 percent increase from the first quarter of 2021 and a 101 percent increase from the second quarter of 2020.
· Generated an operating netback of $26.30 per barrel from an average Brent price of $68.98 per barrel.
· Despite limited petroleum asset capital investment of $125,000, generated funds flow from operations of $1,205,000 compared to a $450,000 use of funds flow in the second quarter of 2020.
· Recognized a reduced net loss of $284,000 ($0.00 per share) compared to a net loss of $2,742,000 ($0.01 per share) in the 2020 equivalent quarter.
· Liquidity remained strong as we ended the second quarter with cash of $11,214,000, a working capital balance of $4,671,000 and $7,500,000 drawn on our term credit facility, resulting in a net debt position of $2,829,000.
· Entered into revised ten-year lease operating agreements for our Coora-1, Coora-2, WD-4 and WD-8 blocks through December 31, 2030.
· Executed an amendment to our $20 million term loan facility agreement, extending the principal availability period from June 15, 2021 to December 31, 2021, thereby allowing us to access the outstanding $12.5 million available balance prior to the end of the year.
· Spudded our final Ortoire minimum exploration commitment well, Royston-1, on August 12, 2021.
Paul Baay, President and Chief Executive Officer, commented:
“Our second quarter results continue to demonstrate the progress we are making in all areas of our operations in Trinidad and are a testament to the great work done by our dedicated staff amidst a challenging COVID environment. The positive cashflow derived from our base assets and our strong liquidity position have allowed us to advance our exploration operations while we work towards initial natural gas production at our Coho and Cascadura discoveries. The team has been active in increasing our base oil production through a series of low-cost workovers and well optimization while preparing for the four development well drilling program planned for the fourth quarter of 2021. On the Ortoire block, we are progressing on all fronts including road construction, bridge repairs, well testing, seismic shooting, facilities design, pipeline installation and drilling our highly anticipated Royston prospect. We remain confident that our available credit facility capacity combined with anticipated funds flow from operations will be sufficient to complete our budgeted four well development program as well as drilling Royston-1, one of a number of milestones that we forecast to achieve in the second half of 2021 as we conclude the first phase of our Ortoire exploration program.”
