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Razor Energy Corp. (RZE.V)

TSXV - TSXV Real Time Price. Currency in CAD
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0.6600+0.0900 (+15.79%)
At close: 3:59PM EDT
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Previous Close0.5700
Open0.6000
Bid0.6300 x 0
Ask0.6600 x 0
Day's Range0.6000 - 0.7200
52 Week Range0.0900 - 0.8300
Volume145,491
Avg. Volume77,965
Market Cap13.903M
Beta (5Y Monthly)6.98
PE Ratio (TTM)N/A
EPS (TTM)-2.1930
Earnings DateApr. 15, 2021
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateJan. 22, 2020
1y Target EstN/A
  • Construction to Commence on the First Co-Produced Geothermal Power Project in Alberta, and Canada
    GlobeNewswire

    Construction to Commence on the First Co-Produced Geothermal Power Project in Alberta, and Canada

    CALGARY, Alberta, May 04, 2021 (GLOBE NEWSWIRE) -- FutEra Power Corp. (“FutEra”), a subsidiary of Razor Energy Corp. (“Razor” or the “Company”) (TSXV: RZE) which is a publicly traded Alberta-based junior oil and gas company, is pleased to announce it is entering the project execution stage of its co-produced Geothermal Power Project in Swan Hills, Alberta (the “Project”). For further investor information please contact the undersigned at info@futerapower.com This Project begins with field construction activities, with financial and in-kind support from Razor (“Stage Gate 1”). FutEra has partnered with our provincial and federal governments to invigorate the emerging geothermal industry. Provincially, Alberta Innovates (“AI”) and Emissions Reduction Alberta (“ERA”), and federally, Natural Resources Canada (“NRCan”), have provided grants to complete funding. With an estimated cost to complete of $20 million, Stage Gate 1 will produce up to 3 MW of green geothermal electricity. The planned second phase of the Project (“Stage Gate 2”), adding a natural gas turbine and optimizing the geothermal power efficiency, is estimated to cost an additional $10 million. With both Stage Gate 1 and 2 of the Project complete, the total nameplate electricity output will be 21 MW. For further project information please visit the FutEra website at www.futerapower.com “This project is one of the many examples of the amazing innovation happening in Alberta. This cutting-edge technology is using existing assets to generate clean power, putting Alberta on the map as a world leader in geothermal energy.” Doug Schweitzer, Minister of Jobs, Economy and Innovation “Razor Energy and FutEra Power have developed an innovative approach to tap into Alberta’s existing oil and gas assets for greener electricity production, making use of both natural gas and geothermal energy. This first-of-its-kind project can help accelerate geothermal co-production and hybrid projects at other high-potential oil and gas sites across the province. ERA is pleased to have worked closely with our Trusted Partners, Alberta Innovates and Natural Resources Canada, to support this clean technology solution that will reduce emissions, lower costs, attract investment, and create jobs in Alberta.” Steve MacDonald, CEO, ERA “Geothermal clean technology is a natural and growing fit for Alberta. This project is paving the way for commercial geothermal co-production use across Western Canada. The expertise and experience gained will also open opportunities for Alberta-based know-how around the world.” Laura Kilcrease, CEO, AI “Razor and FutEra have committed to facing the challenges of producing energy with increasingly sustainable methods through novel and innovative solutions. This Project is the first of many engagements planned between our two companies. We deeply appreciate our public partners AI, ERA and NRCan and commend their vision. Together, we will build better outcomes for Albertans and our stakeholders.” Doug Bailey, President & CEO at Razor and Executive Director of FutEra “When you visit the field and lay your hand on pipe that is too hot to hold, your whole paradigm shifts. That heat is earth heat, and renewable. Innovation is just a matter of working the challenge, building on traditional best practices and adding the twist to harvest earth heat. In addition, we have been collaborating with all the regulatory agencies to forge a new path for industry. There are endless possibilities as we build FutEra into a leading sustainable energy company.” Lisa Mueller, President & CEO of FutEra Background Razor produces and injects large volumes of very hot water, a renewable form of geothermal energy, daily as part of its ongoing conventional oil and gas operations and waterflood activities. This hot water provides FutEra with the opportunity to capture geothermal heat energy and generate power with zero Greenhouse Gas emissions. Co-production means no new surface land footprint is required as the Project utilizes existing assets such as processing infrastructure, producing wells, produced water reinjection system and an operating gathering and distribution system. Using existing assets yields cumulative and substantive effects of reducing typical geothermal project capital outlay, reducing supply risk and improving economic returns. In addition, our co-production approach aligns Alberta’s fledgling geothermal industry to develop alongside Alberta’s well respected, world class oil and gas operations, safety standards and regulatory best practices. Geothermal power is baseload and solves the intermittent challenge of other renewable energy sources. FutEra’s Project stands out as a demonstration of creative and practical co-produced geothermal energy production for the future energy complex, by re-purposing and transitioning existing oil and gas assets to a cleaner future. The University of Alberta (“U of A”), as a research partner in this Project, is conducting modelling on the heat potential of the Western Canada Sedimentary Basin. The U of A endeavors to validate model theory with actual field data from our Project to ensure that the emerging geothermal industry can harness the expertise and data that exists in today’s Alberta resource industry. About FutEra FutEra leverages Alberta’s resource industry innovation and experience to create transitional power and sustainable infrastructure solutions to commercial markets and communities, both in Canada and globally. Currently it is developing a 21 MW co-produced geothermal and natural gas hybrid power project in Swan Hills, Alberta. www.futerapower.com About Razor Razor is a publicly traded junior oil and gas development and production company headquartered in Calgary, Alberta, concentrated on acquiring, and subsequently enhancing, producing oil and gas properties primarily in Alberta. The Company is led by experienced management and a strong, committed Board of Directors, with a long-term vision of growth, focused on efficiency and cost control in all areas of the business. Razor currently trades on TSXV under the ticker “RZE”. www.razor-energy.com Razor has two active subsidiaries, FutEra and Blade Energy Services Corp. (“Blade”). About Blade Blade Energy Services is as subsidiary of Razor. Operating in west central Alberta, Blade’s primary services include fluid hauling, road maintenance, earth works including well site reclamation and other oilfield services. www.blade-es.com For additional information please contact: Doug BaileyLisa MuellerPresident and Chief Executive OfficerPresident and Chief Executive OfficerRazor Energy Corp.FutEra Power Corp.Executive Director FutEra Power Corp. Razor Energy Corp./FutEra Power Corp.800, 500-5th Ave SWCalgary, Alberta T2P 3L5Telephone: (403) 262-0242 READER ADVISORIES FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements. More particularly, this press release contains statements concerning, but not limited to, expected timing and execution of various stages of the Project, anticipated costs in connection with completion the Project, expected electricity output of the Project upon completion, the opinions or beliefs of management, prospects, opportunities, priorities, targets, goals, ongoing objectives, milestones, strategies and outlook of Razor, and includes statements about, among other things, future developments, the future operations, strengths and strategy of Razor. In addition, the use of any of the words “anticipate”, “believe”, “intend”, “may”, “is”, “will”, “should”, “expect” and similar expressions are intended to identify forward-looking statements. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including but not limited to expectations and assumptions concerning the continued availability of capital, current legislation, receipt of required regulatory approvals, the timely performance by third-parties of contractual obligations, the success of reactivation, drilling and development activities, the performance of existing wells, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services prevailing commodity prices, price volatility, price differentials and the actual prices received for the Company’s products. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to several factors and risks. These include, but are not limited to, risks associated with the oil and gas industry and geothermal electricity projects in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; variability in geothermal resources; as the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), electricity and commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas and geothermal industries and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the annual information form and management discussion and analysis of the Company which are available on SEDAR at www.sedar.com. In addition, the effects, risks and impacts related to widespread pandemic outbreaks, including the coronavirus disease (COVID -19), and any related actions taken by businesses and governments, ongoing results, commodity prices, industry conditions and activity levels, currency exchange rates, financial positions or results are unknown at this time and could cause the Company’s actual results to differ materially from the forward-looking statements contained herein. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

  • Razor Energy Corp. Announces Fourth Quarter and 2020 Year End Results
    GlobeNewswire

    Razor Energy Corp. Announces Fourth Quarter and 2020 Year End Results

    CALGARY, Alberta, April 15, 2021 (GLOBE NEWSWIRE) -- Razor Energy Corp. (“Razor” or the “Company”) (TSXV: RZE) announces its fourth quarter and year end 2020 financial and operating results. Selected financial, operational and reserves information is outlined below and should be read in conjunction with Razor’s audited consolidated financial statements, management’s discussion and analysis and annual information form (“AIF”) for the year ended December 31, 2020 which are available on SEDAR at www.sedar.com and the Company’s website www.razor-energy.com. 2020 HIGHLIGHTS Operating Production during the year averaged 3,783 boe/d, representing a decrease of 14% in comparison to 2019 when production averaged 4,387 boe/d. Decreased production volumes are largely due to reduced spending on well reactivations and repairs as well as natural base declines.Razor focused on cost control on all expenditures within its operations and recognized a 7% decrease in total operating costs for 2020 when compared to 2019. Capital Progressed the South Swan Hills co-produced geothermal power generation project, which will be capable of generating 21 MW of grid connected power, of which up to 6MW will be sustainable clean power generation. Innovation Continued operation of six natural gas-powered generators which reduced the Company's reliance on grid electric power and resulted in savings of $2.3 million in electricity costs during 2020.Razor implemented cost saving measures by internalization of certain oilfield services through its subsidiary, Blade Energy Services Corp. ("Blade"), which provides services such as crude oil hauling, earthworks and environmental services. Blade conducted $2.0 million of services on behalf of Razor during 2020 (2019 - $2.3 million).The Company received approval from the Alberta Energy Regulator to repurpose certain facilities in Virginia Hills to become a Waste Management Component employing bioremediation to treat hydrocarbon-impacted soils. This Soil Treatment Facility will use naturally occurring microbes to digest hydrocarbons in soils and will be integral to Razor’s Area Based Closure operations in the Virginia Hills area. The facility is anticipated to be operational in the second quarter of 2021. 2021 OUTLOOKRazor continues to look forward and plan for the future despite 2020 proving to be one of the most challenging years for commodity prices and energy companies due to the COVID-19 pandemic. The Company remained focused on its long-term sustainability and, subsequent to year end, in February 2021 Razor secured an extension to its Term Loan with Alberta Investment Management Corporation, for an amended principal amount of $50.1 million. On February 16, 2021 a subsidiary of Razor entered into a Term Loan with Arena Investors, LP (the “Arena Term Loan”) for a principal amount of US$11.0 million (CAD$14.0 million). The majority of the proceeds from the Arena Term Loan will be used to invest over $8 million in 2021 on well reactivations to provide over 1,000 boepd to the year’s production levels. The balance of work is related to repairs and will be accounted for as operating expenses. The well reactivation activity started in February 2021 and will continue into 2022. Razor has an extensive opportunity set of high-quality wells requiring reactivation. In aggregate, the annual base decline of these wells is anticipated to be consistent with the Company’s current corporate decline of approximately 12 percent. In its history the Company has reactivated over 60 wells adding approximately 2,000 boepd and it expects that this program will result in similar favorable outcomes. The Company continues to focus on cost control on its operated properties and the stabilizing effect of reduced operating costs in each area. Outside of the well reactivation program, Razor will take a cautious and case-by-case approach to spending in 2021 and into 2022, focusing on low risk, low investment capital opportunities to increase field and corporate netbacks. CORPORATE SUSTAINABILITY, ENVIRONMENT & GOVERNANCERazor is committed to a strong corporate sustainability program. ENVIRONMENT GHG Emissions Razor operates a natural gas-powered electricity generation program which allows the Company to reduce its reliance on coal-biased grid electricity and has reduced GHG emissions by 6,000 tCO2 annually.Once constructed, Razor's co-produced geothermal power generation project will reduce GHG emissions by up to 31,000 tCO2 annually.Razor has opted all assets/facilities into Alberta’s Technology Innovation and Emissions Reduction (TIER) program and, as such, has catalogued all GHG sources and is committed to following or exceeding guidelines for GHG reductions in its oil and gas operations. Abandonment, Reclamation, and Remediation Starting in 2020, Razor has opted to participate in the Alberta Energy Regulators (“AER”) Area Based Closure (“ABC”) program, to further reduce our footprint on the environment. Planned work consists of well, facility and pipeline abandonment, site remediation and reclamation. Razor’s liability reduction target is $3.0 million in 2021.The Company has been successful in obtaining approved applications under the Alberta Site Rehabilitation Program (“SRP”) to assist with its abandonment and reclamation activities. The total value of approved applications is $1.5 million. Funds will be used primarily in Razor’s Chin Coulee and Virginia Hills areas, progressing approximately 70 wells towards reclamation certificates.In 2020, the Company settled $538 thousand of decommissioning obligations which included $198 thousand related to government grants earned for well site rehabilitation through the SRP.Since inception, Razor has spent $7.3 million on end-of-life activities, including deconstruction of the Virginia Hills Production Complex, and received 18 reclamation certificates from the AER which confirm that the land has been reclaimed to its natural state in accordance with regulations.In addition to Razor’s annual abandonment and reclamation program, Razor also paid $292 thousand in 2020 into the industry-wide Alberta Orphan Well Fund. GOVERNANCE Razor is committed to diversity and equality in the workplace.Razor is committed to conducting our operations safely and with proper policies, procedures, standards, training, equipment and emergency response procedures in accordance with all government regulations and industry practices.Razor maintains a complete series of documented Corporate policies and requires an annual review and sign off from all employees, consultants, management, executive and directors. Corporate policies include code of conduct, corporate disclosure and whistleblower guidance. NEAR AND MEDIUM-TERM OBJECTIVES Reduce net debt through continued optimization of capital spending and increased efficiencies to reduce operating and general and administrative costs.Actively identify and consider business combinations with other oil and gas producers as well as service companies.Continued focus on implementing a technically viable and commercially sustainable solution to recover geothermal waste heat to power.Further analyze ancillary opportunities including power generating projects, oil blending, and services integration. SELECT QUARTERLY AND ANNUAL HIGHLIGHTSThe following tables summarizes key financial and operating highlights associated with the Company’s financial performance. Three Months Ended Dec 31, Twelve Months Ended Dec 31, ($000's, except for per share amounts and production)2020 2019 2020 2019 Production Crude oil (bbl/d)2,023 2,839 2,176 2,712 Natural gas (mcf/d) 15,165 4,962 4,695 4,635 NGL (boe/d)701 1,011 824 903 Total (boe/d)3,585 4,677 3,783 4,387 Sales volumes Crude oil (bbl/d)2,024 2,862 2,179 2,783 Natural gas (mcf/d)4,461 3,563 3,767 3,501 NGL (bbl/d)701 1,011 824 903 Total (boe/d)3,469 4,467 3,631 4,269 Oil inventory volumes (bbls)8,203 9,251 8,203 9,251 Revenue Oil and NGLs sales11,011 20,013 42,728 78,365 Natural gas sales1,048 774 3,126 2,438 Sale of commodities purchased from third parties 4- (25)- 8,551 Blending and processing income1,456 1,874 5,416 8,842 Other revenue761 119 1,677 1,976 Total revenue14,276 22,755 52,947 100,172 Cash flows from operating activities356 3,894 4,193 16,210 Per share -basic and diluted0.02 0.19 0.20 0.96 Funds flow 2(126)9 3,798 7,691 Per share -basic and diluted(0.01)- 0.18 0.45 Adjusted funds flow 2(120)277 4,138 7,931 Per share -basic and diluted(0.01)0.01 0.20 0.47 Net (loss)(6,048)(11,853)(46,197)(29,573)Per share - basic and diluted(0.29)(0.56)(2.19)(1.75)Dividend paid- 790 263 2,564 Dividends per share- 0.04 0.01 0.15 Weighted average number of shares outstanding (basic and diluted)21,064 21,057 21,064 16,926 Gross Capital expenditures428 2,378 1,929 13,590 Government Grants- (1,669)(1,121)(6,105 Netback ($/boe) Oil and gas sales 336.56 48.31 33.12 50.46 Royalties(4.44)(10.85)(3.19)(8.86)Operating expenses(30.44)(30.05)(27.77)(32.32)Transportation and treating(2.93)(2.38)(2.16)(2.25)Operating netback 2(1.25)5.03 0.00 7.03 Gain/ (Loss) on sale of commodities purchased from third parties4- (0.05)- (0.01)Net blending and processing income 22.65 2.76 2.89 3.40 Realized loss on commodity contracts settlement 30.12 0.46 (1.04)(1.64)Other revenue and income2.93 0.28 4.80 1.23 General and administrative(3.14)(4.54)(3.26)(3.95)Other expenses0.08 (3.14)0.02 (0.84)Impairment0.10 (9.30)(17.87)(2.50)Acquisition and transaction costs(1.02)- (0.24)(0.13)Interest(7.04)(2.89)(4.78)(3.06)Corporate netback 2(6.57)(11.40)(19.48)(0.47) 1) Natural gas production includes internally consumed natural gas primarily used in power generation.2) Refer to "Non-IFRS measures".3) Excludes the effects of financial risk management contracts but includes the effects of fixed price physical delivery contracts.4) From time to time, Razor purchases commodity products from third parties to fulfill sales commitments, and subsequently sells these products to its customers. SELECT QUARTERLY AND ANNUAL HIGHLIGHTS (continued) December 31, December 31, ($000's, except for share amounts)2020 2019 Total assets163,709 189,158 Cash1,098 1,905 Long-term debt (principal)50,145 45,874 Minimum lease obligation3,469 5,329 Net debt 172,789 66,911 Number of shares outstanding21,064,466 21,064,466 1) Refer to "Non-IFRS measures.” 2020 YEAR-END RESERVES For 2020, the net present value of before tax cash flows discounted at 10% ("NPV10") for each reserve category disclosed below includes all abandonment, decommissioning and reclamation costs, and inactive well costs totaling $65.5 million. Reserves Summary1 December 31,($000's unless otherwise stated)2020 2019 Proved developed producing (Mboe)7,416 11,144 Total Proved (Mboe)13,525 16,258 Total Proved plus probable (Mboe)17,319 20,750 Proved developed producing - NPV10126,553 116,832 Proved developed non-producing - NPV10149,199 39,409 Total Proved - NPV10195,508 189,257 Total Proved plus probable - NPV101133,216 242,719 1) The table summarizes the data contained in an independent report of Razor’s gross reserves, as evaluated by Sproule, qualified reserves evaluators, dated February 19, 2021. The figures have been prepared in accordance with the standards contained in the COGEH and the reserve definitions contained in National Instrument 51-101-Standards of Disclosure for Oil and Gas Activities. Gross reserves means the total working interest (operating and non-operating) share of remaining recoverable reserves owned by Razor before deductions of royalties payable to others and without including any royalty interests owned by Razor. Additional reserve information is included in the AIF.2) NPV 10 is net present value of before tax cash flows discounted at 10%. OPERATIONAL UPDATE During the fourth quarter of 2020, the Company realized an operating loss of ($1.25)/boe, down from an operating netback of $5.03/boe in the fourth quarter of 2019. Realized prices decreased by $11.75/boe, however, the impact of decreased prices was offset by royalty decreases of $6.41/boe due to significantly lower oil prices and a slight increase in operating expenses of $0.39/boe in comparison to the same period as in 2019. For the year ended December 31, 2020, the operating netback was $0/boe compared to $7.03/boe for the same period in 2019 mainly as a result of lower realized prices which were down 34%, partially offset by 64% lower royalty and 14% lower operating expenses. Royalty rates averaged 12% in the fourth quarter of 2020 as compared to 22% for the same period in 2019. This decrease in royalties is mostly due to the decrease in commodity prices and production volumes. For the year ended December 31, 2020, royalties averaged 10%, down 18% from the same period last year, mostly due to lower commodity prices and production volumes. Operating expenses increased 1%, on a per boe basis, in the fourth quarter of 2020 compared to the same period in 2019 and were down $2.9 million on a total dollar basis. The Company had limited its well intervention activity in response to the weak commodity price environment. Workovers and facility expenses averaged $2.73/boe in the fourth quarter of 2020 compared to $2.76/boe in the fourth quarter of 2019, while fuel and electricity costs averaged $9.11/boe in the fourth quarter 2020 as compared to $9.45/boe in 2019. Other revenue and income received during the twelve months ended December 31, 2020 was $6.6 million which primarily consisted of $0.8 million of road use, $0.2 million of disposal revenue, $0.2 SRP grant income and $4.7 million of non-recurring insurance proceeds related to environmental clean-up costs as a result of an injection line failure in 2019 as well as proceeds from business interruption insurance related to a non-operated pipeline being offline for repairs in 2019.During 2020, the Company received funds from Canada Emergency Wage Subsidy of $1.5 million. These grants were recognized as a reduction to general and administrative expense of $0.9 million and a reduction of operating expenses of $0.6 million. Razor has focused on cost control on all expenditures within its operations by implementing a procurement system, internalizing field services and producing its own electricity. The top cost drivers consisting of fuel and electricity, labour, property taxes, facility repairs, chemicals and accounted for 67% of total operating expenses in the fourth quarter of 2020 (Q4 2019 – 69%). For the year ended 2020 these same top cost drivers accounted for 70% of total operating expenses (2019 – 68%). The cost of electricity and fuel decreased 25% in Q4 2020 as compared to the same quarter of last year mostly due a 41% decrease in consumption, 3% decrease in average electricity pool prices and a decreased reliance on non-operated fuel gas and lower production levels. For the year ended 2020, the cost of electricity and fuel decreased 14% as compared to the same period of last year, with average electricity pool prices decreasing by 19% and with usage decreasing by 11%. The Company continues to operate its natural gas-powered generation 9 MW facility which reduced its reliance on grid electric power and resulted in savings of $0.5 million in Q4 2020 (Q3 2019 - $0.7 million). For the year ended 2020, the Company achieved electricity savings of $2.3 million (2019 - $2.2 million). CAPITAL PROGRAM During the fourth quarter of 2020, Razor invested $0.2 million on its South Swan Hills Co-Produced Geothermal Natural Gas power project. Since inception, Razor has received $5.9 million in government grants to support this power generation project. The Company projects the capital cost of the project to be $37 million, which will generate 21 MW of grid connected power, of which up to 6MW will emerge from sustainable clean power generation. During 2020, due to the volatile commodity price environment, the Company did not initiate any projects related to finding and development capital and minimal capital reactivations were conducted during this period. Operated capital investment for the year ended 2020 consisted primarily of $1.1 million on the Razor’s Co-Produced Geothermal Natural Gas power project, $0.5 million on field equipment and a variety of project cost adjustments from prior periods, offset by government grants of $1.1 million. RAZOR'S RESPONSE TO COVID-19 Razor is dedicated to ensuring the health, safety and security of its employees, contractors, partners and residents within all of its operating areas and communities. The Company has implemented business procedures that comply with Alberta Health Guidelines to protect the well-being of all stakeholders. Razor has successfully transitioned the majority of its corporate staff required for operational effectiveness back to its head office and the field sites continue to take site specific precautionary measures related to COVID-19. ABOUT RAZOR Razor is a publicly traded junior oil and gas development and production company headquartered in Calgary, Alberta, concentrated on acquiring, and subsequently enhancing, and producing oil and gas from properties primarily in Alberta. The Company is led by experienced management and a strong, committed Board of Directors, with a long-term vision of growth focused on efficiency and cost control in all areas of the business. Razor currently trades on TSX Venture Exchange under the ticker “RZE.V”. For additional information please contact:Doug BaileyPresident and Chief Executive Officer Kevin BraunChief Financial Officer Razor Energy Corp.800, 500-5th Ave SW Calgary, Alberta T2P 3L5Telephone: (403) 262-0242www.razor-energy.com READER ADVISORIES FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to, the Company’s ability to continue to operate in accordance with developing public health efforts to contain COVID-19, the Company’s objectives, including the Company’s capital program and other activities, including ancillary opportunities such as power generation, oil blending and services integration, restarting wells, future rates of production, anticipated abandonment, reclamation and remediation costs for 2021, possible business combination transactions, assistance from government programs including under the SRP and Canadian Emergency Wage Subsidy, commitments under the ABC program and energy management program and other environmental, social and governance initiatives. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including but not limited to expectations and assumptions concerning the availability of capital, current legislation, receipt of required regulatory approvals, the timely performance by third-parties of contractual obligation, the success of future drilling and development activities, the performance of existing wells, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services prevailing commodity prices, price volatility, price differentials and the actual prices received for the Company's products. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry and geothermal electricity projects in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; variability in geothermal resources; as the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), electricity and commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas and geothermal industries and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. In addition, the Company cautions that COVID-19 may continue to have a material adverse effect on global economic activity and worldwide demand for certain commodities, including crude oil, natural gas and NGL, and may continue to result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could continue to affect commodity prices, interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company. The duration of the current commodity price volatility is uncertain. Please refer to the risk factors identified in the annual information form and management discussion and analysis of the Company which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Razor's prospective results of operations, sales volumes, including sale of inventory volumes, production and production efficiency, balance sheet, capital spending, cost and net debt reductions, operating efficiencies, investment infrastructure and components thereof, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as a set forth in the above paragraph. FOFI contained in this document was approved by management as of the date of this document and was provided for the purpose of providing further information about Razor's future business operations. Razor disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. NON-IFRS MEASURES: This press release contains the terms "funds flow", "adjusted funds flow", "net blending and processing income", "net debt", "income (loss) on sale of commodities purchased from third parties", "operating netback" and "corporate netback", which do not have standardized meanings prescribed by International Financial Reporting Standards ("IFRS") and therefore may not be comparable with the calculation of similar measures by other companies. Funds flow represents cash generated from operating activities before changes in non-cash working capital. Adjusted funds flow represents cash flow from operating activities before changes in non-cash working capital and decommissioning obligation expenditures incurred. Management uses funds flow and adjusted funds flow to analyze operating performance and leverage, and considers funds flow and adjusted funds flow from operating activities to be key measures as it demonstrates the Company's ability to generate cash necessary to fund future capital investments and repay debt. Net blending and processing income is calculated by adding blending and processing income and deducting blending and processing expense. Net debt is calculated as the sum of the long-term debt and lease obligations, less working capital (or plus working capital deficiency), with working capital excluding mark-to-market risk management contracts. Razor believes that net debt is a useful supplemental measure of the total amount of current and long-term debt of the Company. Income (loss) on sale of commodities purchased from third parties is calculated by adding sales of commodities purchased from third parties and deducting commodities purchased from third parties. Income (loss) on sale of commodities purchased from third parties may not be comparable to similar measures used by other companies. Operating netback equals total petroleum and natural gas sales less royalties and operating costs calculated on a boe basis. Razor considers operating netback as an important measure to evaluate its operational performance as it demonstrates its field level profitability relative to current commodity prices. Corporate netback is calculated by deducting general & administration, acquisition and transaction costs, and interest from operating netback. Razor considers corporate netback as an important measure to evaluate its overall corporate performance. ADVISORY PRODUCTION INFORMATION: Unless otherwise indicated herein, all production information presented herein is presented on a gross basis, which is the Company's working interest prior to deduction of royalties and without including any royalty interests. BARRELS OF OIL EQUIVALENT: The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Additionally, given that the value ratio based on the current price of crude oil, as compared to natural gas, is significantly different from the energy equivalency of 6:1; utilizing a conversion ratio of 6:1 may be misleading as an indication of value. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

  • Razor Energy Corp. Announces 2020 Year-End Reserves and Operational Outlook
    GlobeNewswire

    Razor Energy Corp. Announces 2020 Year-End Reserves and Operational Outlook

    CALGARY, Alberta, Feb. 25, 2021 (GLOBE NEWSWIRE) -- Razor Energy Corp. (“Razor” or the “Company”) (TSXV: RZE) is pleased to provide a summary of its 2020 year-end reserves evaluation and an updated operational outlook. The highlights and reserves summary below set forth Razor’s gross reserves at December 31, 2020, as evaluated by Sproule Associates Limited (“Sproule”), qualified reserves evaluators, in an independent report dated February 19, 2021 (the “Sproule Report”). The figures in the following tables have been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the “COGEH”) and the reserve definitions contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). Additional reserve information as required under NI 51-101 will be included in the Company’s Annual Information Form which will be filed on SEDAR on or before April 8, 2021. Razor's 2020 annual audited consolidated financial statements have not been completed. Certain financial and operating information included in this news release are based on management's estimates only and are subject to audit and may be subject to change upon completion of the Company’s annual audited consolidated financial statements. See “Reader Advisories – Unaudited Financial Information”. HIGHLIGHTS Proved Developed (“PD”) reserves value discounted at 10% (“NPV10”) before tax is $75.8 million. Considering year over year commodity price change the decrease is 3% over year-end 2019. The PD reserves category is comprised of Proved Developed Producing (“PDP”) and Proved Developed Non-Producing (“PDNP”) reserves.PDP reserves value discounted at 10% (“NPV10”) before tax is $26.6 million whereas PDNP reserves value discounted at 10% (“NPV10”) before tax is $49.2 million.PD reserve volumes are 11,884 Mboe (90% oil and liquids), which represent a decrease of 17% over year-end 2019. Whereas the PDP reserve volumes are 7,416 Mboe, a decrease of 33% over year-end 2019, the PDNP reserve volumes are 4,468 Mboe, an increase of 38% over year-end 2019. This shift in reserve volume categories from PDP to PDNP is a result of Razor’s disciplined and proactive approach to preserving value through minimal capital expenditures on repair, maintenance and workovers during the low commodity price cycle experienced in 2020. As commodity prices improve, the PDNP wells will be reactivated, placed onstream and moved back to the PDP reserves category.Total Proved (“1P”) reserves were 13,525 Mboe, which represents a decrease of 17% over year-end 2019.Total Proved plus Probable (“2P”) reserves were 17,319 Mboe, which represents a decrease of 17% over year-end 2019.The Company’s Reserve Life Index (1) is 5.9 years for PDP, 9.4 years for PD, 10.7 years for 1P and 13.8 years for 2P reserves based on December 2020 field-reported production of 3,450 boepd. The Abandonment, Decommissioning and Reclamation (“ADR”) cost, discounted at year-end 2020, was $34.2 million, an increase of $1.7 million from year-end 2019 ($32.5 million). The Inactive Well Compliance (“IWC”) cost, discounted at year-end 2020, was $31.4 million, an increase of $2.6 million from year-end 2019 ($28.8 million). (1) “Reserve life index” does not have standardized meaning. See “Reader Advisories - Oil and Gas Metrics” contained in this news release. OPERATIONAL OUTLOOK Razor is excited with news it shared last week regarding the multi-year amendment of its existing non-revolving term loan facility and a new term loan and royalty transaction which enhances liquidity. The Company remains focused on advancing its conventional oil and gas base business and reducing indebtedness while responsibly closing out its proportionate share of end-of-life inventory. Razor continues to enjoy its solid reserves base, comprised of 85% light and medium oil and natural gas liquids, which has a stable, annual base decline of 12%. In 2020, the Company took a disciplined and proactive approach to preserving value through minimal capital expenditures on well repair, maintenance and workovers in response to low commodity prices due to the supply/demand imbalance resulting from COVID-19. With renewed liquidity, and recent upward trend in commodity prices, Razor has initiated its 46 well reactivation program which will continue throughout 2021 and into 2022. The Company anticipates bringing approximately 1,500 boepd onstream (primarily light oil and natural gas liquids) from this program at similar declines to its existing reserve base. Once reactivated, the PDNP reserves from these wells will shift back to the PDP reserves category. Currently, Razor’s commitment under the AER’s ABC program is $3.1 million per year. In addition, the Company has been granted $3.5 million in aggregate to round five from Alberta’s Site Rehabilitation Program (“SRP”) through its relationships with trusted service providers. Razor has spent $655 thousand to date under the SRP through well abandonments, reclamation and remediation activities. Since the Company began operations in February 2017, Razor has spent a cumulative $7.3 million on end-of-life activities. Concurrently, Razor’s subsidiary company, FutEra Power, continues to advance development of its 21 megawatt co-produced geothermal and natural gas hybrid power project in Swan Hills. FutEra anticipates construction to commence during the second quarter of 2021 with plans to deliver power to the grid by first quarter of 2022. 2020 INDEPENDENT RESERVES EVALUATION Sproule carried out an independent reserves evaluation effective December 31, 2020, which was prepared in accordance with definitions, standards and procedures contained in the COGEH and in NI 51-101. The reserves evaluation was based on Sproule forecast pricing and foreign exchange rates at December 31, 2020 as outlined herein. Reserves included herein are stated on a company gross basis (working interest before deduction of royalties without the inclusion of any royalty interest) unless otherwise noted. RESERVES SUMMARY Summary of Gross Oil and Gas Reserves at December 31, 2020(1), (2), (3), (4) Light and MediumCrude OilHeavy Crude OilConventionalNatural GasNatural GasLiquidsBarrels of OilEquivalent GrossGrossGrossGrossGross (Mbbl)(Mbbl)(MMcf)(Mbbl)(Mboe)Proved Developed Producing4,9401934,1261,5957,416Developed Non-Producing2,8911037841,3434,468Undeveloped1,178291445981,641Total Proved9,0095875,3553,03613,525Probable2,6371441,3777833,793Total Proved plus Probable11,6467316,7323,81917,319 Net Present Value of Future Net Revenue Before Income Taxes Discounted at (% per Year) (M$) 0% 5% 10% 15% 20% Proved Developed Producing-109,463 7,172 26,553 29,075 28,079 Developed Non-Producing84,169 62,960 49,199 39,730 32,904 Undeveloped32,005 25,137 19,756 15,568 12,284 Total Proved6,712 95,269 95,508 84,372 73,267 Probable86,027 54,611 37,709 27,525 20,853 Total Proved plus Probable92,738 149,880 133,216 111,898 94,120  Notes: (1)The tables summarize the data contained in the Sproule Report and as a result may contain slightly different numbers due to rounding.(2)Gross reserves mean the total working interest (operating or non-operating) share of remaining recoverable reserves owned by Razor before deductions of royalties payable to others and without including any royalty interests owned by Razor.(3)Based on Sproule's December 31, 2020 escalated price forecast. See “Summary of Pricing and Inflation Rate Assumptions – Forecast Prices and Costs”.(4)The net present value of future net revenue attributable to the Company's reserves is stated without provision for interest costs and general and administrative costs, but after providing for estimated royalties, production costs, development costs, other income, future capital expenditures, well ADR and IWC costs. It should not be assumed that the undiscounted or discounted net present value of future net revenue attributable to the Company's reserves estimated by Sproule represent the fair market value of those reserves. Other assumptions and qualifications relating to costs, prices for future production and other matters are summarized herein. The recovery and reserve estimates of the Company's oil, NGL and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates provided herein. Reconciliation of Company Gross Reserves by Principal Product Type (1), (2) The following table sets forth the reconciliation of the Company’s reserves at Forecast Prices and Costs: Light and Medium Crude Oil Heavy Oil FactorsGross ProvedDevelopedProducing(Mbbl) GrossProved(Mbbl) Gross Proved +Probable (Mbbl) Gross ProvedDevelopedProducing(Mbbl) GrossProved(Mbbl) Gross Proved+ Probable(Mbbl) December 31, 20197,029 10,432 13,325 209 555 682 Acquisitions258 303 379 - - - Category Change- - - - - - Disposition- - - - - - Extensions/Infill Drilling- - - - - - Economic Factors(557)(1,260)(1,476)(22)(30)(37)Technical Revision(1,019)304 189 29 86 110 Production(771)(771) (771)(24)(24)(24)December 31, 20204,940 9,009 11,647 193 587 731 Natural Gas Liquids Conventional Natural Gas FactorsGrossProvedDevelopedProducing(Mbbl) GrossProved(Mbbl) Gross Proved +Probable (Mbbl) Gross ProvedDevelopedProducing(MMcf) Gross Proved(Mmcf) Gross Proved+ Probable(Mmcf) December 31, 20192,246 3,122 3,981 9,956 12,892 16,575 Acquisitions128 145 181 342 363 434 Category Change- - - - - - Disposition- - - - - - Extensions/Infill Drilling- - - - - - Economic Factors(177)(361)(514)(452)(501)(780)Technical Revision(299 432 473 (4,386)(6,003)(8,163)Production(302)(302)(302 )(1,335)(1,335)(1,335)December 31, 20201,595 3,036 3,819 4,126 5,355 6,732 Barrels of Oil Equivalent FactorsGross ProvedDevelopedProducing(Mboe) GrossProved(Mboe) Gross Proved +Probable (Mboe) December 31, 201911,144 16,258 20,750 Acquisitions442 508 633 Category Change- - - Disposition- - - Extensions/Infill Drilling- - - Economic Factors(832)(1,744)(2,157)Technical Revision(2,020)(178)(589)Production(1,319)(1,319)(1,319)December 31, 20207,416 13,525 17,319  Notes:(1)The tables summarize the data contained in the Sproule Report and as a result may contain slightly different numbers due to rounding.(2)Conventional Natural Gas includes associated and non-associated gas. Future Development Costs The following table sets forth development costs deducted in the estimation of Razor’s future net revenue attributable to the reserve categories noted below: Forecast Prices and Costs (M$)YearTotal Proved ReservesProved plus Probable 202112,52624,580202225,53525,535202300Thereafter2,5252,525Total Undiscounted40,58552,639Total Discounted at 10%36,00947,826 The future development costs are estimates of capital expenditures required in the future for Razor to convert proved developed and undeveloped non-producing plus probable reserves to proved developed producing reserves. The undiscounted future development costs are $40.6 million for proved reserves and $52.6 million for proved plus probable reserves, in each case based on forecast prices and costs. Summary of Pricing and Inflation Rate Assumptions – Forecast Prices and Costs The forecast cost and price assumptions assume increases in wellhead selling prices and include inflation with respect to future operating and capital costs. Crude oil and natural gas benchmark reference pricing, inflation and exchange rates utilized by Sproule at December 31, 2020 were as follows: YearExchange Rate(CAD/USD)WTI CushingOklahoma 40 API(USD/bbl)Canadian LightSweet 40 API(CAD/bbl)Hardisty BowRiver25 API(CAD/bbl)Natural GasAECO(CAD/mmbtu) 20210.7746.0054.5540.032.8620220.7748.0057.1442.422.7820230.7753.0063.6448.392.6920240.7754.0664.9149.182.7520250.7755.1466.2150.162.8020260.7756.2467.5351.172.8620270.7757.3768.8852.192.9120280.7758.5270.2653.232.972029+0.77+2.0%/yr.+2.0%/yr.+2.0%/yr.+2.0%/yr. 2020 CAPITAL EXPENDITURES Razor spent $237 thousand of capital on production-add activities during the year ended December 31, 2020. During 2020, the Company also incurred $538 thousand on end-of-life abandonment and reclamation activities under the Alberta Energy Regulator’s (“AER”) Area Based Closure (“ABC”) program prior to the AER suspending it in mid-2020 for the remainder of the year in response to low commodity prices. ABOUT RAZORRazor is a publicly traded junior oil and gas development and production company headquartered in Calgary, Alberta, concentrated on acquiring, and subsequently enhancing, producing oil and gas properties primarily in Alberta. The Company is led by experienced management and a strong, committed Board of Directors, with a long-term vision of growth, focused on efficiency and cost control in all areas of the business. Razor currently trades on TSX Venture Exchange under the ticker “RZE”. www.razor-energy.com Razor also has two other active subsidiaries in FutEra Power Corp. (“FutEra”) and Blade Energy Services Corp. (“Blade”). ABOUT FUTERAFutEra leverages Alberta’s resource industry innovation and experience to create transitional power and sustainable infrastructure solutions to commercial markets and communities, both in Canada and globally. Currently it is developing a 21 megawatt co-produced geothermal and natural gas hybrid power project in Swan Hills, Alberta.www.futerapower.com ABOUT BLADEOperating in west central Alberta, Blade’s primary services include fluid hauling, road maintenance, earth works including well site reclamation and other oilfield services.www.blade-es.com For additional information please contact: Doug BaileyPresident and Chief Executive OfficerORKevin BraunChief Financial Officer Razor Energy Corp.800, 500-5th Ave SWCalgary, Alberta T2P 3L5Telephone: (403) 262-0242www.razor-energy.com READER ADVISORIES Forward-Looking Statements. Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “estimate”, “propose”, “project” or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include but is not limited to: Razor’s business strategy, objectives, strength and focus; the ability of the Company to achieve drilling success consistent with management’s expectations; and future development costs associated with oil and gas reserves. Statements relating to “reserves” are also deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future. The forward-looking statements contained in this press release are based on certain key expectations and assumptions made by Razor, including expectations and assumptions concerning the success of future drilling, development, completion and reactivation activities, the performance of existing wells, the performance of new wells, the availability and performance of facilities and pipelines, the geological characteristics of Razor's properties, the successful application of drilling, completion and seismic technology, prevailing weather and break-up conditions, commodity prices, price volatility, price differentials and the actual prices received for the Company’s products, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the availability of capital, labour and services, the creditworthiness of industry partners and Razor’s ability to acquire additional assets. Although Razor believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Razor can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry and geothermal electricity projects in general (e.g., operational risks in development, exploration and production; variability in geothermal resources; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), constraint in the availability of services, electricity and commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas and geothermal industries, regulatory and political risks, adverse weather or break-up conditions and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. These and other risks are set out in more detail in Razor’s annual information form for the year ended December 31, 2019 which is available on SEDAR at www.sedar.com. The forward-looking information contained in this press release is made as of the date hereof and Razor 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 press release is expressly qualified by this cautionary statement. This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about Razor’s prospective results of operations, production, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. FOFI contained in this document was approved by management as of the date of this document and was provided for the purpose of providing further information about Razor’s future business operations. Razor disclaims any intention or obligation to update or revise any FOFI contained in this document, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this document should not be used for purposes other than for which it is disclosed herein. Oil and Gas Metrics. This press release contains a number of oil and gas metrics, including “future development costs”, “reserves life index” and “reserve replacement” which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies. Such metrics have been included herein to provide readers with additional measures to evaluate the Company's performance; however, such measures are not reliable indicators of the future performance of the Company and future performance may not compare to the performance in previous periods. Future development costs are calculated as the sum of development capital plus the change in future development costs for the period. Reserves life index is calculated as total Company share reserves divided by annual production. Reserve replacement is calculated by dividing reserve volume additions by annual production and expressed as a percentage. Boe Disclosure. The term barrels of oil equivalent (“boe”) may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. All BOE conversions in the report are derived from converting gas to oil in the ratio mix of six thousand cubic feet of gas to one barrel of oil. Unaudited Financial Information. Certain financial and operating information included in this press release for the year ended December 31, 2020, are based on estimated unaudited financial results for the year then ended, and are subject to the same limitations as discussed under Forward Looking Information set out above. These estimated amounts may change upon the completion of audited financial statements for the year ended December 31, 2020 and changes could be material. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.