Bellamont Exploration (CVE:BMX.A) said Friday third-quarter revenues grew nearly 18 percent as it swung to a profit, and also reported it has found a new oil Pool in the Montney play in northwestern Alberta at its Grimshaw property.
Revenue rose to $11.3 million in the three months that ended September 30, compared with $9.6 million seen a year-earlier.
Net income grew $1.3 million, or one penny a share, compared to a year-ago net loss of $615,000.
Bellamont reported production went up by 14 percent to 2,411 barrels of oil equivalent, of which included 1,129 barrels of oil and natural gas liquids.
The operating netback for the Canadian company climbed 39 percent to $27.76 a barrel. This is a measure of oil and gas sales net of royalties, production and transportation expenses, and is used in the oil and gas industry as a benchmark to compare performance between time periods, operations and competitors.
Income from operations jumped 27 percent to $4.9 million up from $3.8 million in the prior year quarter.
Bellamont spent $7.6 million on exploration and development in the quarter, as it drilled, finished and started equipping two horizontal oil wells at its Grimshaw property, which initiated production last month at a combined average rate of 170 barrels of oil per day.
During the quarter, Bellamont drilled an exploratory well at Grande Prairie, which is currently being assessed for completion, and also started drilling on two delineation wells in the Grimshaw area.
The company also said Friday that it disposed of a non-core property located in the Sinclair area of Alberta for $7.1 million. The property produced roughly 77 barrels per day and has both proved and probable oil reserves of 380 million barrels.
In addition, Bellamont announced a new Montney oil Pool find and an acquisition in its core Grimshaw area.
The company said the new discovery has the potential of being similar in size and scope as the Triassic D Pool where Bellamont is currently producing the equivalent of 535 barrels of oil equivalent per day.
Production from the new Pool discovery well is expected to begin in the first quarter of next year, with a start rate of 60 barrels of oil per day.
Based on the recent delineation drilling, core analysis and reservoir modeling, Bellamont estimates its land at Grimshaw contains approximately 110 million barrels of discovered petroleum initially in place in the Montney formation.
In total, when combining the existing Triassic D Pool and the new Pool discovery, Bellamont estimates it has 52 horizontal drilling locations at Grimshaw, all of which are supported by three dimensional seismic, it said.
Bellamont has also entered into an agreement to acquire a minority partner's interest in the Grimshaw area. The asset consists of 13 gross sections of land and includes a 25 percent working interest in two joint Montney oil wells.
After the acquisition’s close, Bellamont will have a 100 percent working interest in 17 adjacent sections of lands at Grimshaw.
On reserves, an independent preliminary report indicated total proved reserves of 6,912 million barrels of oil equivalent, 48.6 percent of which are oil and natural gas liquids, with a net present value of future revenue of $106.3 million.
The report also noted total proved plus probable reserves of 15,006 million barrels of oil equivalent, 45 percent of which are oil and natural gas liquids, with a net present value of future revenues of $190.7 million.
These findings represent a 30 percent growth in total proved plus probable reserves for the company, and a 26 percent increase of net present value of future net revenue, Bellamont said.
The Calgary-based company gained 1.5 cents, or 4.48 percent, to trade at 35 cents a share on Toronto’s junior venture exchange on Friday morning.