Oil Prices Rebound After U.S Announcement Regarding Iran Deal

NEW YORK, May 9, 2018 /PRNewswire/ --

Oil Price pared most of its losses on Tuesday after the U.S. president announced that the United States will exit the Iran nuclear deal and reimpose sanctions on the country. International benchmark Brent crude oil futures for July delivery were down 0.67 percent to $75.66 per barrel after a 4 percent decline earlier on Tuesday. The U.S. West Texas Intermediate (WTI) crude futures for June delivery also pared most of its losses on Tuesday after the decision. Iran is a major oil exporter in OPEC and currently produces about 2.5 million barrels a day. Analysts worried that the new sanctions may disrupt global oil supplies and send oil prices higher. International Frontier Resources Corp. (OTC: IFRTF), Denbury Resources Inc. (NYSE: DNR), Chesapeake Energy Corporation (NYSE: CHK), Northern Oil & Gas, Inc. (NYSE: NOG), Advantage Oil & Gas Ltd. (NYSE: AAV)

Oil price has gained more than 15 percent this year due to geopolitical uncertainty and production cut from OPEC and its allies. Brent oil on Monday rose above $70 per barrel, the first time since November 2014. According to a recent survey from Reuters, OPEC oil production fell to a one-year low in April due to decreasing output in Venezuela. The survey found that The Organization of the Petroleum Exporting Countries pumped 32.12 million barrels per day in April, down from 70,000 bpd from March.

International Frontier Resources Corp. (OTCQB: IFRTF) is also listed on the TSX Venture Exchange under the ticker (TSX-V: IFR). Earlier today the company, in partnership with Mexican petrochemical leader Grupo IDESA, announced that, "Tonalli Energia ("Tonalli") has registered and been granted access to the data room for the second tender of Round Three ("Round 3.2") of Mexico's oil and gas energy reform by the National Hydrocarbons Commission (CNH).

Tonalli is in the process of analyzing and assessing block data and completing documentation in anticipation of entering the bidding process. Concessions are to be awarded in September 2018 under a license contract model. The licenses for exploration and production will last 30 years and can be extended for two additional terms of five years each.

CNH announced Round 3.2 on January 25, 2018, which is scheduled to be the 10th upstream bid round since the initiation of the historic energy reform. This new bid round covers 37 onshore conventional blocks for exploration and production, including 21 blocks in the Burgos Region in Tamaulipas, nine blocks in the Tampico-Misantla-Veracruz Region in Veracruz, and seven blocks the Southeastern Region in Tabasco and Campeche, covering collectively 9,513 km2, with prospective resources of approximately 260 million barrels of crude equivalent. These blocks include wet gas, dry gas and light oil.

Through its joint venture, IFR was one of the first foreign companies to participate in Mexico's historic reform of the oil and gas sector. The Tecolutla block was awarded to Tonalli on May 12, 2016 as part of the first round and third call of Mexico's oil and natural gas "mature fields" bid round ("Round 1.3"), the first in almost 80 years."

Denbury Resources Inc. (NYSE: DNR) announced recently net income of $39.6 million, or $0.09 per diluted share, for the first quarter of 2018. Excluding the weather impact, Denbury's production would have increased slightly from fourth quarter 2017 levels. Denbury's production guidance for full-year 2018 remains 60,000 to 64,000 BOE/d, as the January weather impacts were taken into consideration in developing this range. Further production information is provided on page 12 of this press release. Chris Kendall, Denbury's President and CEO, commented, "The momentum we built in the fourth quarter continued and gained strength in the first quarter. The strongest realized oil prices we have seen since the fourth quarter of 2014, combined with our peer-leading oil mix, reduced cost structure, and improved operations drove another quarter of positive free cash flow, meaningful debt reduction, solid financial results, and a stronger balance sheet."

Chesapeake Energy Corporation (NYSE: CHK) in a recent financial report showed that the company's 2018 first quarter, Chesapeake reported net income of $294 million and net income available to common stockholders of $268 million, or $0.29 per diluted share. Chesapeake's average daily production for the 2018 first quarter was approximately 554,000 boe compared to approximately 528,000 boe in the 2017 first quarter. Doug Lawler, Chesapeake's Chief Executive Officer, commented, "The strength of our operations and improved cost structure, coupled with higher realized prices, resulted in our best quarterly financial performance in over three years. For the second consecutive quarter, we recorded significant growth in our earnings and cash flow. Notably, our margin improvement, while aided by increases in commodity indices, was primarily driven by strong oil production and a lower cost structure, highlighting the differential profit generated beyond price impacts, and the sustainability of our improving financial performance."

Northern Oil & Gas, Inc. (NYSE: NOG) announced earlier this week announced 2018 first quarter results and increased the company's full-year 2018 production guidance. Daily production exceeded guidance, increasing 35% year-over-year and 7.5% sequentially to average approximately 18,000 barrels of oil equivalent ("Boe") per day in the first quarter, for a total of 1,619,521 Boe. Increased activity is expected to add 22 - 24 net wells to production during 2018, an increase of two net wells versus prior guidance (estimates do not include the recently announced Salt Creek acquisition) "We are pleased to announce an excellent quarter as drilling activity and well performance continue to exceed our expectations," commented Northern's Interim President, Brandon Elliott.

Advantage Oil & Gas Ltd. (NYSE: AAV) reported on May 3rd, strong cash flow of $48.9 million ($0.26/share) and net income of $10.1 million ($0.05/share) during the first quarter of 2018. Cash flow was supported by the Corporation's proactive marketing strategy which included $18.1 million from hedging gains and enhanced netbacks from natural gas sales at Dawn, Ontario. In addition, liquids revenue increased 18% to $6.6 million and the Corporation achieved low total corporate cash costs of $1.13/mcfe ($6.78/boe) contributing to solid cash flow results. On April 30, 2018, the Corporation renewed its annual credit facility of $400 million with improved borrowing terms and maintained a strong balance sheet with a total debt to trailing 12-month cash flow ratio of 1.4.

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