Drilling & Completions | Quarterly / Earnings Reports | First Quarter (1Q) Update | Financial Results | Capital Markets | Capital Expenditure
Empire Petroleum First Quarter 2023 Results
Print
|
Empire Petroleum announced first quarter 2023 results.
Highlights
- Increased year-over-year per day sales volumes by 4% to 2,206 barrels of oil equivalent per day ("Boe/d") (61% oil, 19% natural gas liquids ("NGLs") and 20% natural gas) from 2,112 Boe/d (60% oil, 19% NGLs, and 21% natural gas) for the first quarter of 2022;
- Reported revenue of $10.1 million, a net loss of $2.5 million, or $0.11 per diluted share, and an Adjusted Net Loss1 of $1.9 million, or $0.08 per diluted share;
- Generated Adjusted EBITDA1 of $0.2 million;
- Ended first quarter of 2023 with $7.1 million of liquidity (including $6.8 million of cash) and working capital of $2.3 million; and
- Leveraging lessons learned in 2022 from the Empire-operated Starbuck Field Pilot Project Program (the "Starbuck Program") in North Dakota, during the first quarter of 2023 the Company made further progress on its development program. Empire owns a 96% working interest and 82.6% net revenue interest in the Starbuck Program.
Mike Morrisett, President and Chief Executive Officer of Empire, commented, "While we clearly would have liked to see higher sequential pricing for crude oil and natural gas, the first quarter marked a solid start to 2023 on multiple fronts. We were pleased to record higher sales volumes both year-over-year and sequentially, as well as keep LOE and G&A per Boe substantially level excluding non-recurring items. As in the past, I want to thank our employees and business partners for their hard work and strong dedication as we continue to execute on our targeted business plan to drive organic production growth in 2023 that increases long-term cash flow generation and shareholder value."
Mr. Morrisett concluded, "Through our pilot program in North Dakota that was executed in 2022 and into 2023, we have come away with a clear direction on how to best tailor our 2023 capital spending program. This includes a combination of activities, including drilling and completions, workovers, recompletions and related infrastructure. To ensure enhancement of our development efforts, we have focused on adding depth to our technical, operations and administrative teams. All of these experienced professionals were targeted to join Empire based on their respective proven histories of success, and we feel fortunate to have them as part of our expanded team. The future of Empire is bright, and we look forward to further steady execution of our 2023 business plan that is squarely focused on driving increased value for our shareholders."
FINANCIAL AND OPERATIONAL RESULTS FOR FIRST QUARTER 2023
Net sales for the fourth quarter of 2022 were 2,206 Boe/d, including 1,336 barrels of oil per day; 442 barrels of NGLs per day, and 2,569 thousand cubic feet per day ("Mcf/d"), or 428 Boe/d, of natural gas. Contributing to the sequential increase from the fourth quarter of 2022 was an 8% increase in production for Empire's assets in North Dakota.
Empire reported $10.1 million of revenue for the first quarter of 2023 versus $10.7 million for the fourth quarter of 2022. Contributing to the decline was lower realized pricing as compared to the fourth quarter and a lower sequential loss on derivates, which was partially offset by higher sales volumes.
Lease operating expenses for the first quarter of 2023 were $6.5 million, which was a slight decrease from $6.6 million for the fourth quarter of 2022 despite increased sales volumes.
Production and ad valorem taxes for the first quarter of 2023 were $0.8 million and essentially flat with the fourth quarter 2022, and were 7.5% and 7.2% of total product revenue, respectively, for the first quarter of 2023 and fourth quarter of 2022.
General and administrative expenses, excluding share-based compensation expense, were $3.0 million, or $15.23 per Boe, in the first quarter of 2023 versus $2.7 million, or $13.65 per Boe, for the fourth quarter of 2022. Included in the first quarter of 2023 was $0.4 million, or $1.89 per Boe, of cash severance costs associated with departure of the Company's previous Chief Executive Officer. Excluding these costs, Empire's cash general and administrative expenses per Boe declined slightly.
Empire recorded a net loss for the first quarter 2023 of $2.5 million, or $0.11 per diluted share, versus a net loss of $2.3 million, or $0.10 per diluted share, in the fourth quarter of 2022. The Company posted an Adjusted Net Loss for the first quarter of 2023 of $1.9 million, or $0.08 per diluted share, versus an Adjusted Net Loss of $0.9 million, or $0.04 per diluted share, in the fourth quarter of 2022. The sequential quarterly decrease was primarily due to lower realized pricing partially offset by higher sales volumes during first quarter 2023.
Adjusted EBITDA was $0.2 million for the first quarter of 2023 compared to $1.3 million in the fourth quarter of 2022.
CAPITAL SPENDING, BALANCE SHEET & LIQUIDITY
For the three months ended March 31, 2023, the Company invested approximately $2.2 million in capital expenditures primarily related to the well enhancement project in North Dakota.
Total liquidity at the end of the first quarter of 2023 was $7.1 million, including $6.8 million of cash and approximately $0.3 million available on the Company's Credit Facility. As of March 31, 2023, the Company had total debt of $7.1 million and working capital of $2.3 million. Empire remains squarely focused on continuing to execute on its proven strategy to remain financially conservative as it executes on its 2023 development program for its current business and will continue to evaluate opportunities to expand through targeted acquisitions that provide long-term value for the Company's shareholders.
More First Quarter (1Q) Update News
Gulfport Touts Super Long Lateral and Strategic Pivot To Gas Asset
Gulfport Energy Corporation kicked off 2025 with a quarter of operational precision, pricing strength, and clear strategic intent — setting the stage for a transformative year ahead. From…
Civitas Provides Update on Current Rigs & Frac Crews
Second Quarter Outlook The Company has reiterated its full year guidance for 2025. For the second quarter, Civitas anticipates approximately five percent oil volume growth at the midpoint…
NuVista Energy – 2025 Capital Program and Operating Momentum
NuVista enters 2025 with strong operational momentum following a record 2024 and a balance sheet that affords both growth and shareholder returns. The Company has reaffirmed its ~$450…
Large Permian E&P Talks 1Q'24; 282 Wells Planned for 2024
Diamondback Energy provided an update to it's first quarter 2024. Let's first take a look at the development plan. The company program remains unchanged, and one can expect…
CNX Resources Cut Frac Activity 50%, Talks 1st Quarter Activity
CNX Resources a marcellus operator provided an update on its first quarter 2024 activity. Activity quick Read - Reduced to 1 rig - Reduced from dedicated frac crew…
Ark-La-Tex News
Why $90 Oil Isn’t Bringing Back the Rigs
Higher oil prices are not translating cleanly into a drilling response across U.S. shale, and company disclosures are starting to show why. The issue is not simply capital…
These Three Companies Will Increase Drilling & Completion Over The Next 3 Year
In the span of fifteen months, three Japanese energy companies committed more than $10.3 billion to U.S. natural gas production assets — a buying spree that has transferred…
Q1 A&D Transactions Jump to $30B , While Deal Flow Was Down 40%
The first quarter of 2026 has officially defined the "Barbell Era" of American oil and gas. While the total number of deals plummeted by 46% YoY (dropping to…
Wright to U.S. Oil Industry: The Price Signal Is Telling You to Drill
Energy Secretary Chris Wright stood in front of the largest gathering of oil executives in the world this morning and delivered a message that was equal parts market…
Apa Corp : Doing More With Less
APA's 2025 narrative was one of operational surprise. The company came in beating production guidance every single quarter while spending below plan, capturing over $300MM in cost savings…
Permian News
Diversified Energy Striking While the Iron is Hot in East Texas
Transaction Summary Diversified Energy has entered into a definitive purchase and sale agreement to acquire high-working interest, natural gas producing assets in East Texas from Sheridan Production for…
Permian Resources to Grow Production 6% in 2026
Permian Resources exited 2025 as the largest pure-play Delaware Basin operator with ~480,000 net acres and >105,000 net royalty acres. The company averaged 392.6 MBoe/d in 2025, including…
Battalion Oil Closes ~$60M West Quito Draw Asset Sale
Battalion Oil Corporation has closed the sale of its West Quito Draw assets in the Southern Delaware Basin to MCM Delaware Resources LLC, a subsidiary of MCM Energy…
Deal Rumor: ConocoPhillips Exploring $2B Permian Asset Sale
ConocoPhillips is reportedly exploring the potential sale of certain Permian Basin assets in a transaction valued at approximately $2 billion, according to Reuters, citing sources familiar with the…
Mitsubishi to Buy Aethon for ~$5.2B, Taking Scaled Haynesville Gas Platform
Mitsubishi Corporation has agreed to acquire Aethon (Aethon III LLC, Aethon United LP and related entities) for a total equity investment of approximately $5.2 billion, delivering Mitsubishi a…