Quarterly / Earnings Reports

Yoho Increases Montney, Kaybob Production; Talks Reserves

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   |    Wednesday,May 22,2013

Yoho Resources Inc. has reported the results of updated reserve and contingent resource assessments of the Company's Kaybob Duvernay assets and certain of the Company's Nig Montney assets as evaluated by GLJ Petroleum Consultants Ltd. (GLJ).

Highlights:

• Yoho's production during fiscal Q2 2013 averaged 2,481 boe per day, a 20% increase from fiscal Q1 2013 production of 2,075 boe per day. Additional production from two recently drilled Duvernay wells was added in late March 2013 and did not have a significant impact on fiscal Q2 average production.
• Yoho's current estimate of production capability is over 3,100 boe per day. During May 2013, the Company will have experienced a full month of shut-in production due to the SemCams KA gas plant turnaround. Fiscal Q3 average production is currently estimated at approximately 2,500 boe per day, which incorporates the May 2013 shut-in production.
• Yoho generated funds from operations for fiscal Q2 2013 of $4.1 million ($0.08 per share basic and diluted) based on increased production, higher liquids and NGL production, and improved commodity prices during the quarter.
• Field net-backs for the Company's Duvernay wells were $42.37 per boe during fiscal Q2 2013.
• Net exploration and development expenditures to date in fiscal 2013 were $24.7 million, with the Company participating in drilling 2 (1.5) net gas wells at Kaybob and constructing pipelines and surface facilities at both Nig and Kaybob.
• Yoho's total net debt at March 31, 2013 was $35.6 million on a bank credit facility of $56 million.
• At Kaybob, Yoho's proved plus probable reserves as evaluated by GLJ as at March 31, 2013 increased 29% to 19.4 MMboe from 15.0 MMboe at September 30, 2012. The net present value of Yoho's estimated future net revenue before income taxes from proved plus probable reserves at Kaybob as at March 31, 2013 and utilizing GLJ's April 1, 2013 price forecast and discounted at 10%, is $180.6 million, an increase of 46% from September 30, 2012.
• At Nig, Yoho's proved plus probable reserves as evaluated by GLJ as at March 31, 2013 increased 118% to 10.7 MMboe from 4.9 MMboe at September 30, 2012. The net present value of Yoho's estimated future net revenue before income taxes from proved plus probable reserves at Nig as at March 31, 2013 and utilizing GLJ's April 1, 2013 price forecast and discounted at 10%, is $70.2 million, an increase of 205% from September 30, 2012.
• The best estimate for the Company's Contingent Resources for the evaluated area at Kaybob in the Duvernay formation is 51.2 MMboe net as at March 31, 2013, consisting of 168.0 bcf of natural gas and 23.2 million barrels of natural gas liquids. This estimate excludes all proved plus probable reserves assigned to Yoho's interests at Kaybob by GLJ as at March 31, 2013.
• The best estimate of the Kaybob Duvernay Contingent Resources has a net present value to Yoho of $326.4 million (after the recovery of all anticipated capital) using a discount rate of 10% and utilizing the GLJ price forecast as at April 1, 2013.
• The best estimate for the Company's Contingent Resources for the evaluated area at Nig in the Upper Montney formation is 59.2 MMboe net as at March 31, 2013, consisting of 299.2 bcf of natural gas and 9.3 million barrels of natural gas liquids. This estimate excludes all proved plus probable reserves assigned to Yoho's interest at Nig by GLJ as at March 31, 2013.
• The best estimate of the Nig Montney Contingent Resources has a net present value to Yoho of $245.1 million (after the recovery of all anticipated capital) using a discount rate of 10% and utilizing the GLJ price forecast as at April 1, 2013.

Reserves/Resource Evaluation - Kaybob Duvernay

Due to the recent drilling of additional Duvernay wells at Kaybob by Yoho and other operators during fiscal 2013, GLJ was engaged to prepare an updated independent evaluation report of Yoho's reserves and contingent resources at Kaybob, Alberta effective as at March 31, 2013. The GLJ Kaybob Report was prepared in accordance with NI 51-101 and the COGE Handbook.

Reserves Evaluation

The Company's working interest of total proved plus probable reserves for the Duvernay at Kaybob as at March 31, 2013 is estimated by GLJ to be 19.4 MMboe. As at September 30, 2012, a total of 15.0 MMboe of proved plus probable reserves were assigned to the Company's working interest in the Duvernay at Kaybob. The reserves evaluation incorporates approximately 30% of Yoho's land base at Kaybob, Alberta based on GLJ's assumption of four wells per section.

Reserves/Resource Evaluation - Nig Montney

Subsequent to the property swap at Nig and Yoho securing additional production information in the area, GLJ was engaged to prepare an independent evaluation report of Yoho's reserves and contingent resources at Nig, British Columbia effective as at March 31, 2013. The GLJ Nig Report was prepared in accordance with NI 51-101 and the COGE Handbook.

Reserves Evaluation

The Company's working interest of total proved plus probable reserves for the Montney at Nig as at March 31, 2013 is estimated by GLJ to be 10.7 MMboe. As at September 30, 2012, a total of 4.9 MMboe of proved plus probable reserves were assigned to the Company's working interest in the Upper Montney at Nig. The reserves evaluation incorporates approximately 10% of Yoho's land base at Nig, British Columbia.

For fiscal 2013, Yoho is currently planning a total capital program of between $35.0 and $38.0 million, with the majority of the exploration program and related capital budget allocated to the Duvernay at Kaybob. It is estimated that Yoho's average production for fiscal 2013 will be approximately 2,500 boe per day. For the remainder of calendar 2013, Yoho plans to drill 3 (1.25 net) horizontal wells from two separate pad sites at Kaybob. Yoho expects that it will have the cash flow and available bank lines to fund planned activity in fiscal 2013 and exit the year without impairing the balance sheet.