Calgary, Alberta – February 28, 2007 - Yoho Resources Inc. (“Yoho” or the “Company”) filed
today the consolidated financial statements for the quarter ended December 31, 2006 and related
Management’s Discussion and Analysis on www.sedar.com.
Yoho is also pleased to announce results of its fiscal 2007 capital program to date.
- Yoho’s current production (exit February 2007) is estimated at 1,400 boe per day with an
additional 245 boe per day temporarily shut-in. Yoho also has an estimated 200 boe per
day from recent drilling success “behind pipe” awaiting tie-in and facility activity.
- On December 31, 2006, Yoho closed an acquisition of oil and gas properties in British
Columbia. The results of operations from these assets will be included in the Company’s
financial statements beginning January 1, 2007.
- Yoho has drilled 16 (8.3 net) wells to date in fiscal 2007, with a 66.3% success ratio on a
net basis. All of the drilling success to date has occurred within the Company’s Peace
River Arch core area.
Effective December 31, 2006, Yoho closed an acquisition of all of the issued and outstanding
partnership units of a limited partnership for the purchase price of $25.8 million, including working
capital adjustments. The petroleum and natural gas assets of the limited partnership are in
northeast British Columbia, the majority of which are located in the Buick Creek, Mike and Siphon
areas, with production of approximately 500 boe per day. The assets acquired also include
23,800 net acres of undeveloped lands, a substantial two-dimensional and three-dimensional
seismic data set and ownership in three processing facilities and related gathering systems. The
results of operations from these assets will be included in Yoho’s consolidated financial
statements from January 1, 2007.
During the second fiscal quarter, Yoho commenced field operations on the British Columbia
properties. Several re-completions and work-overs will precede the planned drilling program on
these properties. The first re-completion has been successful and the incremental production
was placed on-stream during the last week of February, 2007. The company expects to drill up to
seven wells in British Columbia during calendar 2007.
To February 28, 2007, the Company has participated in 16 (8.3 net) wells, with a 66.3% success
ratio on a net basis.
Fiscal 2007 Drilling Results to February 28, 2007
Yoho has drilled two successful wells at Balsam, Alberta. The first well (62.5%) has been
recently stimulated and will be flow tested shortly. The second Balsam well (60%) has been
cased and will be completed in two zones in early March.
At Boundary, Yoho drilled a successful gas well (50%) which production tested at initial rates 1.5
mmcf per day at a flowing pressure of 240 psi. The tie-in of this well is currently underway.
Drilling at Worsley, Alberta, resulted in one oil well (47.5%) with current production of 30 barrels
per day and one well (50%) that tested gas from two zones at rates of 0.7 mmcf per day with
some water production and 1.2 mmcf per day, respectively.
At Manir, Yoho drilled a gas well (55%) that tested gas from one zone on a drill stem test at 0.8
mmcf per day and tested 1.0 mmcf per day from a second zone on a short flow test.
Yoho participated in a winter drilling program at Basset Lake in northern Alberta which resulted in
three gas wells (50%) and one well (50%) that was junked and abandoned after encountering
surface problems. The three gas wells are scheduled to be on stream by March 1, 2007.
Yoho has continued to add to its inventory of land and seismic. The Company currently has over
80,000 net acres of undeveloped land and 1,600 km of 2D seismic and 198 km2 of 3D seismic
which provides a solid inventory of prospects and opportunities.
Yoho continues to monitor natural gas prices and resulting cash flows closely to determine total
capital programs for the year. Total capital expenditures for fiscal 2007 are expected to be $25 to
$26 million. The Company has flexibility in the current budget to accelerate or reduce capital
programs accordingly with changes in natural gas pricing and related cash flows.
Yoho’s production averaged 825 boe per day for the first fiscal quarter of 2007 (October to
December, 2006), excluding the results of operations of the BC oil and gas properties which were
acquired effective December 31, 2006. An additional 245 boe per day was temporarily shut-in
early in the first fiscal quarter. The Company’s production was slightly less than the previous
quarter due to these shut-in wells which substantially impacted the Company’s production during
the first fiscal quarter.
At Manir, Alberta Yoho had forecasted the shut in of a high gas-oil ratio oil well (75 boe per day
net) which is currently awaiting regulatory approval of a GOR penalty relief application.
At Sinclair, Alberta, during the first fiscal quarter, the Company experienced an un-forecasted
shut-in of a 100% working interest natural gas well that was producing approximately 125 boe per
day net to Yoho. This well had been on-stream and producing for one week to a third party gas
plant when the operator of the facility shut-in all third party gas. Yoho has continued to work with
the facility operator and has reached an agreement to install additional compression at the third
party facility which will allow production of the Sinclair gas well to resume. The well is expected
to be back on-stream in April, 2007 at approximately 125 boe per day.
Yoho also had two heavy oil wells (30 boe per day net) shut-in during the entire first quarter due
to mechanical issues, which the new operator of the pool has been asked to address. These
wells should be back on stream during March, 2007.
Yoho’s current production (exit February 2007) is estimated at 1,400 boe per day with an
additional 245 boe per day temporarily shut-in as described above. Yoho also has an estimated
200 boe per day from recent drilling success “behind pipe” awaiting tie-in and facility activity. All
of the currently “behind pipe” production is expected to be on stream by April, 2007 with the
exception of the Manir well, which is awaiting regulatory approvals.
Average production for the second fiscal quarter (January to March, 2007) for Yoho is estimated
to be between 1,400 and 1,450 boe per day, with an exit rate for the second quarter estimated
between 1,600 and 1,700 boe per day.
Yoho Resources Inc. is a Calgary based junior oil and natural gas company with operations
focusing in the northwest Peace River Arch of Alberta and northeast British Columbia. The
common shares of Yoho are listed on the TSX Venture Exchange under the symbol “YO”.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the
securities in any jurisdiction. The common shares of Yoho will not be and have not been
registered under the United States Securities Act of 1933, as amended, and may not be offered
or sold in the United States, or to a U.S. person, absent registration or applicable exemption
For more information please contact:
Wendy S. Woolsey
Vice President, Finance and CFO
Yoho Resources Inc.
Phone: (403) 537-1771
The TSX Venture Exchange has neither approved nor disapproved the contents of this
Certain statements regarding Yoho Resources Inc. including management’s assessments of future plans
and operations, may constitute forward-looking statements under applicable securities laws and necessarily
involve known and unknown risks and uncertainties, most of which are beyond Yoho's control. These risks
may cause actual financial and operating results, performance, levels of activity and achievements to differ
materially from those expressed in, or implied by, such forward-looking statements.
Such factors include, but are not limited to: the impact of general economic conditions in Canada and the
United States; industry conditions including changes in laws and regulations including adoption of new
environmental laws and regulations, and changes in how they are interpreted and enforced; competition; the
lack of availability of qualified personnel; fluctuations in commodity prices; the results of exploration and
development drilling and related activities; imprecision in reserve estimates; the production and growth
potential of Yoho's various assets; fluctuations in foreign exchange or interest rates; the ability to access
sufficient capital from internal and external sources; and obtaining required approvals of regulatory
Accordingly, Yoho gives no assurance nor makes any representations or warranty that the expectations
conveyed by the forward-looking statements will prove to be correct and actual results may differ materially
from those anticipated in the forward looking statements. Yoho undertakes no obligation to publicly update
or revise any forward-looking statements.
Disclosure provided herein in respect of barrels of oil equivalent (boe) may be misleading, particularly if used
in isolation. A boe conversion ratio of 6 mcf to 1 bbl is based on an energy equivalency conversion method
primarily at the burner tip and does not represent a value equivalency at the wellhead.