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Oryx Petroleum Announces Third Quarter 2015 Financial and Operational Results and 2016 Capital Budget

11 November 2015

Calgary, Alberta, November 11, 2015

Hawler production facilities commissioned; Regular production, sales and payment throughout the quarter; Drilling to resume; $90 million 2016 Capital Budget


Oryx Petroleum Corporation Limited (“Oryx Petroleum” or the “Corporation”) today announces its financial and operational results for the three and nine months ended September 30, 2015 and its capital expenditure budget for 2016. All dollar amounts set forth in this news release are in United States dollars, except where otherwise indicated.

Financial Highlights:

  • Total revenues of $4.2 million on working interest sales of 170,000 barrels of oil and an average realised sales price of $20.83/bbl for Q3 2015
  • Oil sales to a regional marketer that commenced in March 2015 have continued on a regular basis with full cash payment received for all sales in the nine month period ended September 30, 2015
  • Net loss of $316.7 million ($2.56 per share) in Q3 2015 versus $1.6 million ($0.01 per share) in Q3 2014, including a $310.8 impairment charge related to the Hawler, Wasit and OML 141 license areas
  • Capital expenditure of $31.8 million for Q3 2015 including $30.6 million in the Hawler license area
  • Revised forecasted full-year 2015 cash capital expenditures of $107 million including $23 million in Q4 2015. Fourth quarter expenditures to include the re-completion of the Demir Dagh-3 well in the Jurassic reservoir and the re-completion of two wells currently producing from the Demir Dagh Cretaceous reservoir in the Hawler license area
  • $35.0 million of cash and cash equivalents as of September 30, 2015
  • $50.0 million of $100 million credit facility provided by The Addax & Oryx Group P.L.C. (“AOG”) remains undrawn


Operations Highlights:

  • Gross (100%) oil production averaged 2,800 bbl/d for the three months ended September 30, 2015 with production achieved on 97% of the days in the period. Gross (100%) oil production averaged 1,500 bbl/d for the month of October with two wells shut-in due to high levels of water production
  • Commissioning of the Hawler production facilities representing gross (100%) capacity of 40,000 barrels per day with two trains to process Cretaceous and Jurassic crude production streams. The de-commissioning of temporary processing facilities has also been completed
  • Pipeline infrastructure is in place to export oil via the Kurdistan Region of Iraq (KRI) to Turkey export pipeline with final commissioning to occur when oil production volumes justify export by pipeline
  • The Corporation has contracted the TTS-150 rig from International Oil Tools (“IOT”) to commence drilling/re-completion activities in the Hawler license area in the coming weeks. The Corporation plans to re-complete the Demir Dagh-3 well in the Jurassic reservoir and two existing wells in the Demir Dagh Cretaceous reservoir before year end 2015
  • The gross (100%) oil production exit rate for 2015 from the Hawler license area is not expected to be substantially above October 2015 production levels as the impact of the 2015 re-completion activities are not expected to contribute to production until early 2016


2016 Capital Expenditure Budget and Production Outlook:

  • 2016 cash capital expenditure budget of $90 million including approximately $83 million focused on development of the Demir Dagh field and appraisal of the Zey Gawra field in the Hawler license area in the Kurdistan Region of Iraq. Key components of the budget include:
    - Demir Dagh Drilling: $23 million for the drilling of 1 deviated development well, 1 horizontal development well, the re-completion of a previously drilled well for production and the re-completion of a previously drilled well for water disposal
    - Demir Dagh Facilities: $14 million including capital lease payments for the Hawler production facilities, enhanced water treatment and disposal facilities and flowlines related to new wells
    - Zey Gawra Drilling: $14 million for the drilling of 1 appraisal well and the sidetrack of the ZEG-1 discovery well. Both wells are intended to be completed for production
    - Zey Gawra Facilities: $17 million for the construction of a 9.4 km multiphase pipeline to tie the Zey Gawra wells back to the Hawler production facilities
    - Hawler – Other: $16 million for expenditures related to technical support, studies, local office and production sharing contract compliance
    - West Africa: $7 million for license maintenance, data analysis, and preparation for future data acquisition and drilling activity
  • Assuming full funding of expenditures related to the Corporation´s plans, the successful completion of all planned activities, and drilling success, the Corporation expects gross (100%) production from the Hawler license area to reach 12,000 to 15,000 bbl/d by the end of 2016



  • The Corporation expects cash on hand, the remaining undrawn portion of the AOG credit facility, and net revenues assuming a $55 per barrel average Brent price and continued export sales via truck, to fund its operations into the second quarter of 2016. However, $50-$75 million of additional capital is required to fund all budgeted cash expenditures in 2016


CEO´s Comment
Commenting today, Oryx Petroleum’s Chief Executive Officer, Michael Ebsary, stated:

“During the third quarter of 2015, we completed our Hawler production facilities at the Demir Dagh field and, importantly, we re-formulated our overall approach for the Hawler license area. Our revised approach is reflected in our plans for the remainder of 2015 and our 2016 capital budget and includes use of new well designs in the Demir Dagh Cretaceous reservoir while also commencing the development and appraisal of lighter oil reserves in both the Demir Dagh Jurassic and the Zey Gawra Cretaceous reservoirs. We have a rig on its way to Hawler and will begin implementing our plan in the coming weeks.

Our 2016 capital budget has also been developed in the context of financial constraints. We require additional capital to fund our 2016 plans and are in advanced discussions with several parties. We are confident such funding will be secured in the coming months.

The environment for monetizing crude production in the Kurdistan Region also continues to improve. Our liftings and related cash payments under the crude sales agreement with a regional marketer continue. Although we expect this to be our primary sales channel for Hawler crude oil in the near term, we have begun to see renewed interest from local marketers for our production now that more oil is being exported from the region via pipeline. We are also encouraged by the commencement of regular payments to other producers exporting via pipeline and are confident we will have access to the export pipeline as we increase production levels.

Overall, we remain positive on the inherent value in our asset base and are confident in and very much look forward to implementing our 2016 plan.”