Surge Energy Reports Third Quarter Financial and Operational Results

Surge Energy (TSX:SGY) announced its financial and operational results for the third quarter, which represents the first full quarter of results following the $430 million sale of the company’s Saskatchewan and Manitoba assets.
As quoted in the press release:

Given the significant drop in world crude oil prices from US WTI $108 per barrel in June of 2014, to a low of $38per barrel in August of 2015, together with OPEC’s stated change of strategy in November of 2014 (i.e. to protect market share rather than the price of crude oil), Surge management has acted decisively and aggressively to properly position the Company for a “lower for longer” crude oil price scenario.
Accordingly, in the first half of 2015 the Company sold 5,300 boepd in two transactions for combined gross proceeds of $465 million to completely reposition Surge’s balance sheet to grow and prosper in a significantly lower crude oil price environment. In addition, in the first half of 2015 Surge management unwound the Company’s fixed price crude oil hedges for 2015, and realized a significant gain of over $35 million. These proceeds were also utilized to pay down debt and enhance the Company’s balance sheet.
As a result of these, and other capital allocation strategies and business decisions (including disciplined capital spending and rigorous cost cutting), Surge now enjoys a strong balance sheet, and is uniquely positioned to grow and pay dividends in virtually any reasonable crude oil price scenario.

Click here to read the full Surge Energy (TSX:SGY) press release.