HALIFAX, NOVA SCOTIA–(Marketwire – Dec. 17, 2012) –
Corridor Resources Inc. (“Corridor”) (TSX:CDH) is pleased to announce that it has entered into a forward sale agreement for 6,000 mmbtu per day from January 1, 2013 to March 31, 2013, which represents approximately two-thirds of its estimated Q1 2013 production, at an average price of $US8.52/mmbtu. Corridor’s remaining production will be sold at daily market prices which are expected to be strong during Q1 2013 due to the high basis differential in the New England markets. As a result, Corridor forecasts a cash flow from operations of approximately $3.7 million for Q1 2013. This forward sale agreement will ensure Corridor achieves a much higher cash flow from operations for 2013 compared to Corridor’s 2012 forecasted cash flows.
In addition, Corridor averaged a natural gas sales price of approximately $US6.70/mmbtu for its November 2012 production. Reflecting higher natural gas prices in October and November, Corridor has increased its forecasted cash flow from operations for 2012 from $3 million to $4 million.
“These prices are a good indication of the strategic location of Corridor’s existing production at the McCully Field and the Frederick Brook shale gas play in New Brunswick and the effective pipeline connection to premium markets priced in New England” said Phil Knoll, CEO of Corridor. “Corridor’s ability to access premium markets creates a strategic advantage for Corridor’s on-going natural gas development in New Brunswick”.
Corridor is an Eastern Canadian junior resource company engaged in the exploration for and development and production of petroleum and natural gas onshore in New Brunswick and Québec and offshore in the Gulf of St. Lawrence. Corridor currently has natural gas reserves and production in the McCully Field near Sussex, New Brunswick and discovered crude oil reserves in the Caledonia Field near Sussex, New Brunswick in 2008. In addition, Corridor has contingent resources and discovered resources of shale gas in Elgin, New Brunswick.
Forward Looking Statements
This press release contains certain forward-looking statements and forward-looking information (collectively referred to herein as “forward-looking statements”) within the meaning of Canadian securities laws. All statements other than statements of historical fact are forward-looking statements. Forward-looking information typically contains statements with words such as “anticipate”, “believe”, “plan”, “continuous”, “estimate”, “expect”, “may”, “will”, “project”, “should” or similar words suggesting future outcomes. In particular, this press release contains forward-looking statements pertaining to: business plans and strategies; natural gas sales, production, natural gas prices, cash flow from operations in 2012 and 2013, and the ability to access premium markets.
Undue reliance should not be placed on forward-looking statements, which are inherently uncertain, are based on estimates and assumptions, and are subject to known and unknown risks and uncertainties (both general and specific) that contribute to the possibility that the future events or circumstances contemplated by the forward-looking statements will not occur. There can be no assurance that the plans, intentions or expectations upon which forward-looking statements are based will in fact be realized. Actual results will differ, and the difference may be material and adverse to Corridor and its shareholders.
Forward-looking statements are based on the terms of the forward sale agreement and Corridor’s current beliefs as well as assumptions made by, and information currently available to, Corridor concerning anticipated financial performance, business prospects, strategies, regulatory developments, future natural gas commodity prices, future natural gas production levels, the ability to obtain equipment in a timely manner to carry out development activities, the ability to market natural gas successfully to current and new customers, the impact of increasing competition, the ability to obtain financing on acceptable terms, and the ability to add production and reserves through development and exploration activities. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks that forward-looking statements will not be achieved. These factors may be found under the heading “Risk Factors” in Corridor’s Annual Information Form for the year ended December 31, 2011.
The forward-looking statements contained in this press release are made as of the date hereof and Corridor does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, except as required by applicable law. The forward-looking statements contained herein are expressly qualified by this cautionary statement.
Certain of the forward-looking statements in this press release may constitute “financial outlooks” as contemplated by National Instrument 51-102 Disclosure Obligations, including information related to projected revenues, expenses, capital expenditures and production for 2012 and working capital and net debt as at December 31, 2012, which are provided for the purpose of forecasting the financial position of Corridor at the end of the 2012 financial year and in 2013. Please be advised that the financial outlook in this press release may not be appropriate for purposes other than the one stated above.