Granite Oil Reports Third Quarter Results, Increases Monthly Dividend

Granite Oil Corp (TSX:GXO) announced its financial and operational results for the third quarter ended September 30 and provided an operational update.
Highlights as quoted in the press release:

• Generated funds from operations of $14.5 million during the quarter which funded capital spending of $6.6 million, dividends of $2.9 million and the repayment of $3.5 million of debt, resulting in a 65% payout ratio. Granite also recorded an adjustment of $1.8 million related to the May 2015 corporate reorganization involving Boulder Energy.
• Granite exited the quarter with $41.5 million of net debt, an 8% reduction relative to second quarter net debt of $45.0 million. Granite’s annualized debt to cash flow is 0.7x.
• Increased quarterly oil production by 8% to 3,358 bbls/d (3,644 BOE/d) relative to second quarter oil volumes of 3,120 bbls/d (3,461 BOE/d). Granite’s current production is approximately 3,500 bbls/d of oil.
• Capital expenditures during the quarter were limited to $6.6 million, which included the drilling of two, 100% working interest horizontal production wells in the core of the Company’s Alberta Bakken Property. The balance of the quarter’s capital expenditures were primarily on facilities and exploration activities.
• Horizontal well costs during the quarter were $2.3 million and $2.1 million respectively, materially lower than the $2.8 million included in the Company’s initial guidance. Subsequent to the quarter, Granite drilled and brought on-stream a horizontal well in the core of the Bakken pool for $ 1.9 million, 32% below budgeted well costs of $2.8 million.
• Granite’s gas injection enhanced oil recovery (EOR) scheme was expanded during the quarter with the addition of a sixth gas injector well. The implementation of the EOR scheme remains ahead of schedule and Granite has now received regulatory approvals for the seventh and eighth injector wells. Granite is currently injecting all of its Bakken solution gas and is anticipating that its remaining non-associated shallow gas will be used to support its EOR scheme with the phasing in of these new injector wells.
• Operating costs during the quarter were $5.98/BOE, 20% lower than guidance of $7.50/BOE. Lower costs reflect efficiencies realized from the accelerated implementation of its full scale EOR scheme and lower operational costs due to market conditions.
• Granite increased its monthly dividend by 8% to $0.0325 ($0.39 per year) effective September 2015. Granite is pleased to announce its intention to increase the dividend by an additional 8% to $0.035 per month ($0.42 per year) payable in December, 2015, matching its production growth.

Click here to read the full Granite Oil Corp (TSX:GXO) press release.