RCS - Valeura Energy Inc. - Third Quarter 2024 Results

Valeura EnergyAnnouncement

13/11/2024 08:15

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RNS Number : 0488M  Valeura Energy Inc.  13 November 2024

Third Quarter 2024 Results

Singapore, November 13, 2024: Valeura Energy Inc. (TSX:VLE, OTCQX:VLERF)
("Valeura" or the "Company") reports its unaudited financial and operating
results for the three and nine month periods ended September 30, 2024.

 

Q3 2024 Highlights

·    Nong Yao C field development online in August 2024, resulting in a
66% increase in greater Nong Yao production, exceeding management's
expectations((1)(2));

·    Strong drilling performance, with Nong Yao C drilling programme
executed faster than planned and 25% below budget, giving rise to more 2024
drilling than originally expected;

·    Wassana field mobile offshore production unit ("MOPU") inspection
completed and the field resumed production in early August 2024;

·    Excellent safety performance with no incidents or spills;

·    Revenue of US$139 million, with an average price realisation of
approximately US$79/bbl;

·    Adjusted EBITDAX of US$71 million((3)), and adjusted cashflow from
operations of US$50 million((3)); and

·    Cash of US$156 million((3)), after having paid US$30 million in
petroleum taxes related to H1 2024.

 

Recent Achievements

·    Record aggregate production in both September and October 2024,
averaging 26.4 mbbls/d((1));

·    Guidance assumptions re-affirmed, with expectation for Q4 production
of approximately 26 mbbls/d, resulting in the mid-point full year production
range estimate;

·    Higher crude oil inventory at the end of Q3 and higher Q4 production
expected to yield record sales in Q4 2024;

·    Corporate restructuring fully completed on November 1, 2024,
resulting in the pooling of US$397 million in cumulative tax losses((4))
across the Manora, Nong Yao, and Wassana fields, effective November 1, 2024;
and

·    Approval of a share buyback programme to commence on November 14,
2024.

 

(1) Working interest share production, before royalties.

(2) 11.6 mbbls/d (last seven days of Q3), compared to 7.0 mbbls/d (the week
just prior to starting Nong Yao C).

(3) Non-IFRS financial measure - see "Non-IFRS Financial Measures and Ratios"
section in the Company's management discussion & analysis for the three
and nine month period ended September 30, 2024 (the "MD&A").

(4) Unaudited internal management estimate as at September 30, 2024, based on
Thai baht exchange rate as of November 1, 2024, subject to review by tax
advisors and auditors.

Dr. Sean Guest, President and CEO commented:

"I am pleased with our recent operational and financial delivery.  We are
delivering on all aspects of our business including production and cashflow,
while also adding reserves and resources across our portfolio.  Our team
demonstrated a top-notch performance at our Nong Yao C field development,
executing the project safely, and delivering oil production rates at the top
end of our expectations.  With ongoing smooth production at Nong Yao, and
across all of our assets, we have achieved record production rates in both
September and October, with our working interest share oil production before
royalties averaging 26.4 mbbls/d.  We are poised to achieve all of our
guidance estimates for the year while at the same time having reduced our
capex and delivering more wells than originally planned.

The consolidation of all our Thai III assets into a single subsidiary is a
milestone for our business.  All steps are now completed for us to pool our
forward costs and apply our substantial tax loss carry-forwards to the
combined income generated from the Nong Yao, Manora, and Wassana fields from
November 1, 2024 on.  This will immediately increase the Company's cash flow
generation and further enhance our ability to extend the producing life of our
fields in Thailand.

At the same time, the combined effects of higher production and
more-than-usual oil in inventory at the end of Q3 create the potential for
strong financial performance in Q4 2024.  Given the strength of our balance
sheet and expected cash flows in the near term, we have substantial
optionality in our approach to capital allocation.  We are well-positioned to
continue pursuing value through growth, both organically in our current
portfolio and with M&A, while also providing returns to shareholders.  As
such we have recently announced the approval of a share buyback programme to
commence on November 14, 2024.

 

Q3 2024 Performance Summary Table

                                                                 Three Months Ending  Three Months Ending

September 30, 2024
June 30, 2024
 Average Daily Oil Production((1))                (bbls /d)      22,210               21,068
 Oil Volumes Sold                                 (mbbls)        1,765                1,870
 Oil Revenues                                     (US$'000)      139,278              163,960
 Net Earnings/(Loss)                              (US$'000)      (3,913)              11,309
 Adjusted EBITDAX((2))                            (US$'000)      70,551               99,594
 Adjusted Pre-Tax Cashflow from Operations        (US$'000)      63,810               87,117
 Adjusted Cashflow from Operations((2))           (US$'000)      50,138               65,686
 Adjusted Opex((2))                               (US$'000)      53,788               54,171
 Adjusted Capex((2))                              (US$'000)      35,490               30,641
 Weighted average shares outstanding - basic      ('000 shares)  106,982              105,919

                                                                 As at                As at

September 30, 2024
June 30, 2024
 Cash & cash equivalents and Restricted cash      (US$'000)      155,943              146,819
 Debt                                             (US$'000)      Nil                  Nil
 Adjusted Net Working Capital                     (US$'000)      166,261              144,244
 Shareholder's Equity                             (US$'000)      314,423              317,431

 

(1) Working interest share production, before royalties.

(2) Non-IFRS financial measure - see "Non-IFRS Financial Measures and Ratios"
section in the MD&A.

 

 

Financial Update

The Company's Q3 2024 financial performance was characterised by ongoing
strong production volumes, influenced by the effect of lower oil sales due
both to the timing of liftings and lower prevailing oil prices, as compared to
the previous quarter.

 

Oil production was up, averaging 22.2 mbbls/d during Q3 2024 (Valeura's
working interest share, before royalties), an increase of 5% from the prior
quarter.  Rates were buoyed by an increase in output from the Nong Yao C
development coming online near the end of the quarter, but were offset by a
precautionary suspension of production operations at the Company's Wassana
field throughout July 2024.  At the end of Q3, with Nong Yao C fully online
and all assets running smoothly, the average working interest share oil
production rate before royalties over the months of September and October 2024
averaged 26.4 mbbls/d.

 

Oil sales / liftings totalled 1.8 million bbls during Q3 2024, 6% below the
prior quarter.  At the end of the Q3, Valeura held crude oil inventory of 1.2
million bbls, which was approximately 30% higher than the inventory at the
start of Q3. 0.51 million bbls of this quarter-end inventory were lifted on
October 1, 2024, and will be recorded as revenue in Q4 2024.  As a result of
the higher-than-usual inventory position at end Q3, the Company expects for Q4
sales to exceed production.

 

Price realisations averaged $78.9/bbl during Q3 2024. equating to an
approximate $0.6/bbl premium to the monthly average Dubai crude oil during the
period.  Dubai crude is the key oil benchmark used for selling crude oil in
the Gulf of Thailand.  All the Company's crudes realised a premium to Dubai
crude benchmark at every lifting during Q3.  A large proportion of the
Company's sales occurred at the tail end of Q3, which corresponded to a
relatively lower commodity price environment at the time, as compared to the
average over the full period.  In addition, a widening of the Dubai crude
discount to Brent resulted in a discount to the average monthly Brent price.
 The Company continues to anticipate full year price realisations
approximately on par with the Brent benchmark, in keeping with its guidance
estimates.

 

The resulting oil revenue during Q3 2024 was US$139.3 million, down 17% from
Q2 2024 due to both lower volumes lifted (resulting in increased inventory)
and lower oil prices.  One of the Company's crude oil liftings (0.18 million
bbls) occurred just prior to the end of Q3, as a result of the settlement
delay between the lifting of crude oil (i.e. recorded as sales) and receipt of
the proceeds, the approximately US$14 million value of this lifting (Valeura's
working interest share, before royalties) was received in October 2024 and are
recorded as a receivable as at September 30, 2024.  In addition, two further
cargos were lifted and sold in the first week of Q4 2024.

 

Operating expenses during Q3 2024 were US$47.3 million, opposed to US$41.7
million in Q2 2024.  Adjusted opex during Q3 was US$53.8 million,
approximately on par with adjusted opex of US$54.2 in the prior quarter.
When expressed on a per unit of production basis, adjusted opex in Q3 2024 was
US$26.3/bbl, approximately 7% lower than US$28.3/bbl in Q2 2024.

 

Valeura generated adjusted EBITDAX of US$70.6 million in Q3 2024,
approximately 29% lower than in Q2 2024, largely as a result of lower revenue.

 

During Q3 2024, the Company paid petroleum taxes of US$30.1 million,
reflecting the first half-year instalment of petroleum income taxes due in
respect of its Nong Yao and Manora fields.  No tax was due on the Wassana
field given the existing tax losses in the subsidiary company that held the
Wassana asset at end of the quarter.

 

After accounting for the impact of ongoing capital spending and operating
expenses (which includes certain one-off items relating to underwater
inspection work at the Wassana field), as at September 30, 2024, the Company
had a cash position of US$155.9 million, which includes US$22.5 million held
as restricted cash.  Valeura remains debt free.

 

Valeura's adjusted net working capital surplus increased to US$166.3 million
at September 30, 2024.

 

 

Operations Update

During Q3 2024, the Company had ongoing production operations on all of its
Gulf of Thailand fields, comprised of the Jasmine, Nong Yao, Manora, and
Wassana fields.  One drilling rig and one workover rig were under contract
during the quarter, with the workover rig released in August 2024.

 

Valeura's aggregate working interest share of production before royalties
averaged 22.2 mbbls/d during Q3 2024.  Rates toward the end of the quarter
were higher, and the Company expects to maintain production at approximately
26 mbbls/d through the remainder of the year.

 

Jasmine/Ban Yen

Oil production before royalties from the Jasmine/Ban Yen field, in Licence
B5/27 (100% operated interest) averaged 7.6 mbbls/d during Q3 2024, an
increase of 3% from Q2 2024.  Increased production rates reflect the start-up
of two horizontal infill wells which were drilled on the Jasmine A platform in
Q3 2024, and together delivered oil at an initial (three-day average) rate of
1,050 bbls/d (before royalties).  In addition, Valeura finished work on the
final four wells of a six-well workover campaign, which was in progress at the
beginning of the quarter.

 

As of mid-September, following completion of the two Jasmine A infill
development wells, the Company's contracted drilling rig went off contract for
scheduled inspection and maintenance work in dry dock.  In early Q4 2024 the
rig returned to the Jasmine field where it is currently conducting an infill
drilling campaign on the Jasmine D platform, which is expected to be completed
in mid-November 2024.

 

Nong Yao

At the Nong Yao field, in Licence G11/48 (90% operated working interest),
production increased primarily due to the Nong Yao C development, which came
online August 15, 2024.  Following full ramp-up of rates from Nong Yao C,
aggregate production from the licence achieved rates averaging 11.6 mbbls/d
during the last seven days of the quarter (Valeura working interest share
before royalties) and has remained stable to date.  This is an increase of
84% from Q2 2024.

 

Developing the Nong Yao C accumulation included drilling seven producer wells
and one water injection well, all which were completed during Q3 2024.  In
addition, the Company drilled a successful appraisal well, and appraised
additional targets with an expanded scope of some of the development wells,
which have created an inventory of future infill drilling targets within the
Nong Yao C accumulation.  Overall drilling performance has exceeded
management's expectations, with the Nong Yao C drilling programme being
executed faster than planned, and 25% below budget.

 

The Nong Yao field is now the Company's largest source of production.  In
addition, it also has the Company's lowest per unit adjusted opex and its oil
typically fetches a premium to the Brent benchmark.  As a result, Nong Yao is
the Company's most cash generative asset, a characteristic which will be
significantly increased going forward as a result of the corporate
restructuring announced on November 5, 2024.

 

Wassana

Oil production at the Wassana field, in Licence G10/48 (100% operated
interest), averaged 2.7 mbbls/d (before royalties), a decrease of 42% from Q2
2024 due to the impact of a suspension of production operations lasting
throughout the month of July 2024, while the Company conducted underwater
inspection work.  Subsequent to the inspection, which affirmed the structural
integrity of the facility, production at the Wassana field resumed on August
5, 2024, and production rates increased to pre-suspension levels in the days
thereafter.

 

During Q3, 2024, Valeura progressed front end engineering and design work for
the potential redevelopment of the Wassana field.  The Company is targeting
to be ready for a final investment decision on the project in late Q1 2025,
with an ultimate goal of more fully commercialising the Wassana field's
reserves and resources and extending the economic life of the field well
beyond 2030.

 

Manora

At the Manora field, in Licence G1/48 (70% operated working interest),
Valeura's working interest share of oil production before royalties averaged
2.5 mbbls/d, a decrease of 7% from Q2 2024.  No wells were drilled or worked
over during Q3 2024.

 

Valeura intends to start a drilling campaign on the Manora asset shortly,
comprised of three infill development wells plus two appraisal wells.

 

Türkiye: West Thrace Deep Gas Play

The Company had no active operations in Türkiye during Q3 2024 as it
continued its search for a farm-in partner to pursue the next phase of work on
the deep gas play, where it holds interests ranging from 63% to 100%.  The
third extension period of the Banarli and West Thrace Exploration Licences,
extending the term of such licences until June 27, 2025, has been successfully
completed and officially gazetted.  The Company intends to apply for further
extensions in the future.

 

 

Guidance Update

On August 8, 2024, the Company announced updated guidance estimates for the
full year 2024, including a narrowed production guidance range and lowered
capex estimate.  All other guidance estimates were unchanged.

 

 Category                                          Original 2024 Guidance                           Updated 2024 Guidance                            Nine months ended September 30, 2024
 Average Daily Oil Production((1))  (bbls/d)       21,500 - 24,500                                  22,000 - 24,000                                  21,722
 Price realisations                 (US$/bbl)      Approx. equivalent to the Brent crude benchmark  Approx. equivalent to the Brent crude benchmark  US$1.0/bbl premium to Brent
 Adjusted opex((2))                 (US$ million)  205 - 235                                        205 - 235                                        160
 Adjusted capex((3))                (US$ million)  135 - 155                                        135 - 145                                        95
 Exploration expense                (US$ million)  Approx. 8                                        Approx. 8                                        7

 

(1) Working interest share production, before royalties.

(2) Represents adjusted opex which is a non-IFRS financial measure - see
"Non-IFRS Financial Measures and Ratios" in the MD&A.

(3) Represents adjusted capex which is a non-IFRS financial measure - see
"Non-IFRS Financial Measures and Ratios" in the MD&A.

 

 

While oil production performance for the nine months ended September 30, 2024
averaged below the updated guidance range, more recent rates were higher,
averaging 26.4 mbbls/d through September and October 2024, and supports a
forecast full year production outcome at the mid point of the guidance
range.  The Company continues to expect all other metrics to be within the
forecast guidance estimates, with capex potentially on the lower end of the
range.

 

The Company intends to announce guidance estimates for the full year 2025 at
approximately end of 2024.

 

 

Corporate Restructuring

 

Effective November 1, 2024, Valeura completed an internal restructuring such
that its working interests in the Nong Yao, Manora, and Wassana fields are now
held by a single wholly-owned subsidiary.  As a result, Valeura will
immediately pool all future costs and historical petroleum income tax loss
carry-forwards associated with these assets.  Notably, this includes
estimated available cumulative tax loss carry-forwards of US$397 million, at
September 30, 2024((1)).  With a petroleum tax rate of 50%, Valeura expects
to realise value as a result of immediate and near-term additional cash flow
from this restructuring.

Valeura has previously indicated that the tax obligations relating to the
previous subsidiary companies' arrangement are required to be assessed
immediately and settled within the next 30 days.  The Company can now say
that the assessment and settlement will only occur in March 2025.  Taxation
arrangements for the Jasmine field, which is governed by a different vintage
of fiscal terms (known as Thai I), and held in a separate subsidiary entity,
will continue unchanged.

 

(1) Unaudited internal management estimate as at September 30, 2024, based on
Thai baht exchange rate as of November 1, 2024, subject to review by tax
advisors and auditors.

 

 

Share Buyback Programme

Given the Company's strong cash position and outlook for enhanced near-term
cash flow, Valeura believes it has the financial capacity to support both
inorganic growth opportunities as well as shareholder returns.  Valeura's
management believes shareholder returns in the near-term are best achieved
through share buybacks.

 

The Company received approval from the Toronto Stock Exchange ("TSX") to
undertake a share buyback programme via the TSX's established regime for
normal course issuer bids ("NCIB").  This programme has been approved for a
one-year period commencing on November 14, 2024 and ending on November 13,
2025, or such earlier date as the Company may determine, or upon completion of
purchases pursuant to the NCIB.

 

The Company will employ an automatic share purchase plan with a designated
broker, enabling the share buyback programme to continue during applicable
regulatory restrictions or internal trading black-out periods.
Notwithstanding, Valeura intends to utilise the NCIB judiciously, executing
buybacks on an opportunistic basis, reflecting management's belief that the
prevailing market price of the shares may not, from time to time, reflect the
Company's intrinsic value and future prospects.

 

 

Webinar

Valeura's management team will host an investor and analyst webinar on
Thursday November 14, 2024 at 08:00 Calgary / 15:00 London / 22:00 Bangkok /
23:00 Singapore to discuss today's announcement.  Please register in advance
via the link below.

 

Registration link:
https://events.teams.microsoft.com/event/e72118f5-8047-42db-81fb-1ca839eb634a@a196a1a0-4579-4a0c-b3a3-855f4db8f64b
(https://events.teams.microsoft.com/event/e72118f5-8047-42db-81fb-1ca839eb634a@a196a1a0-4579-4a0c-b3a3-855f4db8f64b)

 

As an alternative, an audio only feed of the event is available by phone using
the Conference ID and dial-in numbers below.

 

Thailand: +66 2 026 9035,,428302927#

Singapore: +65 6450 6302,,428302927#

Canada: (833) 845-9589,,428302927#

Türkiye: 0800 142 034779,,428302927#

United States: (833) 846-5630,,428302927#

United Kingdom: 0800 640 3933,,428302927#

 

Phone conference ID: 428 302 927#

 

For further information, please contact:

Valeura Energy Inc. (General Corporate
Enquiries)                       +65 6373 6940

Sean Guest, President and CEO

Yacine Ben-Meriem, CFO
Contact@valeuraenergy.com (mailto:Contact@valeuraenergy.com)

Valeura Energy Inc. (Investor and Media
Enquiries)                       +1 403 975 6752 / +44
7392 940495
Robin James Martin, Vice President, Communications and Investor Relations
IR@valeuraenergy.com (mailto:IR@valeuraenergy.com)

Contact details for the Company's advisors, covering research analysts and
joint brokers, including Auctus Advisors LLP, Canaccord Genuity Ltd (UK),
Cormark Securities Inc., Research Capital Corporation, and Stifel Nicolaus
Europe Limited, are listed on the Company's website at
www.valeuraenergy.com/investor-information/analysts/
(http://www.valeuraenergy.com/investor-information/analysts/) .

 

About the Company

Valeura Energy Inc. is a Canadian public company engaged in the exploration,
development and production of petroleum and natural gas in Thailand and in
Türkiye. The Company is pursuing a growth-oriented strategy and intends to
re-invest into its producing asset portfolio and to deploy resources toward
further organic and inorganic growth in Southeast Asia. Valeura aspires toward
value accretive growth for stakeholders while adhering to high standards of
environmental, social and governance responsibility.

Additional information relating to Valeura is also available on SEDAR+ at
www.sedarplus.ca (http://www.sedarplus.ca) .

Advisory and Caution Regarding Forward-Looking Information

Certain information included in this news release constitutes forward-looking
information under applicable securities legislation. Such forward-looking
information is for the purpose of explaining management's current expectations
and plans relating to the future. Readers are cautioned that reliance on such
information may not be appropriate for other purposes, such as making
investment decisions. Forward-looking information typically contains
statements with words such as "anticipate", "believe", "expect", "plan",
"intend", "estimate", "propose", "project", "target" or similar words
suggesting future outcomes or statements regarding an outlook. Forward-looking
information in this news release includes, but is not limited to, anticipated
higher-than normal sales in Q4 2024; the Company's expectations that it will
achieve all its guidance estimates for 2024 while at the same time having
reduced its capex; the consolidation of the Thai III assets into a singly
subsidiary increasing the Company's cash flow generation; the Company's
ability to apply its substantial tax loss carry-forwards to the combined
income of its fields and the resulting impact on cash flows; the combined
effects of higher production and more than usual oil in inventory at the end
of Q3 creating a uniquely strong financial performance in Q4; Valeura being
well positioned to continue pursuing value through growth, while providing
returns to shareholders; the timing of the commencement of the NCIB; the
recording of revenue derived from the 0.51 million bbls lifted on October 1,
2024 in Q4 2024; the Company's anticipation that the full year price
realizations will be approximately on par with the Brent benchmark; Valeura's
intention to immediately pool all future costs and historical petroleum income
tax loss carry-forwards associated with the Nong Yao, Manora and Wassana
fields; Valeura's expectations regarding obtaining a significant value from
its corporate restructuring; the Company's expectations that the assessment
and settlement of tax obligations related to the previous subsidiary will
occur in March 2025; the Company's expectation that it will maintain
production at current levels throughout the remainder of the year; the
Company's expected timing for the completion of the infill drilling campaign
on the Jasmine/Ban Yen fields; the Company's anticipated timing for a final
investment decision on the Wassana field; Valeura's intention to start a
drilling campaign on the Manora field in Q4 2024, and the composition of such
drilling campaign; the Company's intention to apply for subsequent extensions
of the Banarli and West Thrace Exploration licences; the Company's
expectations that all metrics will be within the Company's forecasted guidance
for 2024; the Company's anticipated timing for the announcement of its
guidance estimates for 2025; the Company's plan to enter into an automatic
share purchase plan; and the Company's expectation to execute buybacks on an
opportunistic basis. Although the Company believes the expectations and
assumptions reflected in such forward-looking information are reasonable, they
may prove to be incorrect.

Forward-looking information is based on management's current expectations and
assumptions regarding, among other things: political stability of the areas in
which the Company is operating; continued safety of operations and ability to
proceed in a timely manner; continued operations of and approvals forthcoming
from governments and regulators in a manner consistent with past conduct;
future drilling activity on the required/expected timelines; the prospectivity
of the Company's lands; the continued favourable pricing and operating
netbacks across its business; future production rates and associated operating
netbacks and cash flow; decline rates; future sources of funding; future
economic conditions; the impact of inflation of future costs; future currency
exchange rates; interest rates; the ability to meet drilling deadlines and
fulfil commitments under licences and leases; future commodity prices; the
impact of the Russian invasion of Ukraine; royalty rates and taxes;
management's estimate of cumulative tax losses being correct; future capital
and other expenditures; the success obtained in drilling new wells and working
over existing wellbores; the performance of wells and facilities; the
availability of the required capital to funds its exploration, development and
other operations, and the ability of the Company to meet its commitments and
financial obligations; the ability of the Company to secure adequate
processing, transportation, fractionation and storage capacity on acceptable
terms; the capacity and reliability of facilities; the application of
regulatory requirements respecting abandonment and reclamation; the
recoverability of the Company's reserves and contingent resources; future
growth; the sufficiency of budgeted capital expenditures in carrying out
planned activities; the impact of increasing competition; the ability to
efficiently integrate assets and employees acquired through acquisitions;
global energy policies going forward; future debt levels; and the Company's
continued ability to obtain and retain qualified staff and equipment in a
timely and cost efficient manner. In addition, the Company's work programmes
and budgets are in part based upon expected agreement among joint venture
partners and associated exploration, development and marketing plans and
anticipated costs and sales prices, which are subject to change based on,
among other things, the actual results of drilling and related activity,
availability of drilling, offshore storage and offloading facilities and other
specialised oilfield equipment and service providers, changes in partners'
plans and unexpected delays and changes in market conditions. Although the
Company believes the expectations and assumptions reflected in such
forward-looking information are reasonable, they may prove to be incorrect.

Forward-looking information involves significant known and unknown risks and
uncertainties. Exploration, appraisal, and development of oil and natural gas
reserves and resources are speculative activities and involve a degree of
risk. A number of factors could cause actual results to differ materially from
those anticipated by the Company including, but not limited to: the ability of
management to execute its business plan or realise anticipated benefits from
acquisitions; the risk of disruptions from public health emergencies and/or
pandemics; competition for specialised equipment and human resources; the
Company's ability to manage growth; the Company's ability to manage the costs
related to inflation; disruption in supply chains; the risk of currency
fluctuations; changes in interest rates, oil and gas prices and netbacks; the
risk that the Company's tax advisors' and/or auditors' assessment of the
Company's cumulative tax losses varies significantly from management's
expectations of the same; potential changes in joint venture partner
strategies and participation in work programmes; uncertainty regarding the
contemplated timelines and costs for work programme execution; the risks of
disruption to operations and access to worksites; potential changes in laws
and regulations, the uncertainty regarding government and other approvals;
counterparty risk; the risk that financing may not be available; risks
associated with weather delays and natural disasters; and the risk associated
with international activity. See the most recent annual information form and
management's discussion and analysis of the Company for a detailed discussion
of the risk factors.

The forward-looking information contained in this new release is made as of
the date hereof and the Company undertakes no obligation to update publicly or
revise any forward-looking information, whether as a result of new
information, future events or otherwise, unless required by applicable
securities laws. The forward-looking information contained in this new release
is expressly qualified by this cautionary statement.

This news release does not constitute an offer to sell or the solicitation of
an offer to buy securities in any jurisdiction, including where such offer
would be unlawful. This news release is not for distribution or release,
directly or indirectly, in or into the United States, Ireland, the Republic of
South Africa or Japan or any other jurisdiction in which its publication or
distribution would be unlawful.

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that term is defined in the policies of the Toronto Stock Exchange) accepts
responsibility for the adequacy or accuracy of this news release.

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