ShaMaran Reports Third Quarter 2024 Results
VANCOUVER, BC, Nov. 7, 2024 /CNW/ - ShaMaran Petroleum Corp. ("ShaMaran" or the "Company") (TSXV:SNM) (Nasdaq First North: SNM) today released its financial and operating results and related management's discussion and analysis (MD&A) for the three and nine months ended September 30, 2024. View PDF
Garrett Soden, President and CEO of ShaMaran, commented: "This is another strong quarter for ShaMaran, with the benefits of the TAQA/HKN transaction starting to show through our higher share of production and local sales at Atrush. We remain focused on minimizing our cost base and deleveraging the Company while reviewing further consolidation opportunities in Kurdistan. Long-term, we look forward to a commercial solution for the restart of exports through the Iraq-Türkiye pipeline."
Corporate Highlights:
On August 6, 2024, the Company closed the acquisition of TAQA Atrush B.V. and the subsequent sale of an indirect interest in the Atrush Block to HKN Energy IV, Ltd. announced on January 22, 2024. The two-step transaction increased the Company's indirect 27.6% stake in the Atrush Block to a 50% working interest (66.67% paying interest) following the sale of an indirect 25% working interest (33.33% paying interest) to HKN Energy IV, Ltd. An affiliate of HKN Energy is now operator of Atrush, and the Kurdistan Regional Government's 25% working interest in the block has been converted to a carried interest;
On July 1, 2024, the Company's amended bond terms became effective, including a two-year extension of the maturity date to July 2027;
The closure of the Iraq-Türkiye pipeline ("ITP") since March 25, 2023, continues to have a material impact on ShaMaran's operations and financial results. The Company is actively engaging with the relevant parties to resume pipeline exports;
In Q3 2024, average gross daily oil production from Atrush and Sarsang combined was 59,300 bopd, 114% higher than Q3 2023 (27,700 bopd from Sarsang only as Atrush was shut-in after the ITP closure) due to local sales achieved from both blocks; and
Revenue in Q3 2024 was $29.4 million, 133% higher than Q3 2023 ($12.6 million) due to local oil sales, the restart of Atrush production in Q4 2023 and an increased working interest in the Atrush Block since August 7, 2024.
Financial Highlights:
Three months ended Sept 30
Nine months ended Sept 30
USD Thousands
2024
2023
2024
2023
Revenue
29,425
12,644
74,643
62,566
Gross margin on oil sales
9,955
1,595
24,200
19,494
Cash flow from operations
29,127
13,126
63,272
30,658
EBITDAX
21,509
5,834
50,450
31,185
The Company generated $29.1 million in operating cash flow during Q3 2024 from local sales, 122% higher than Q3 2023 ($13.1 million);
ShaMaran generated $21.6 million of free cash flow before debt service1 in Q3 2024 due to the strength of local sales and proactive cost-cutting, 112% higher than Q3 2023 ($10.2 million);
EBITDAX2 has consistently increased since the ITP shutdown, with Q3 2024 EBITDAX at $21.5 million, 270% higher than Q3 2023 ($5.8 million);
Q3 2024 oil sales to the Kurdistan local market averaged a net oil price of