viewAdvantage Oil & Gas Ltd.

Advantage Oil rises to highest since 2011 as Q4 funds from operations jump 41%


Advantage Oil & Gas Ltd. (TSE:AAV), the fifth-largest producer in Canada's Montney shale formation, rose to the highest in more than two years after reporting a 41 percent jump in funds from operations in the fourth quarter. 

Advantage advanced to C$5.46, the highest intraday price since August 2011, and was trading at C$5.41, up 5.3 percent, at 1:55 p.m. in Toronto.

Funds from operations increased to $23.8 million, or 14 cents per share, in the three months ended Dec. 31, from $17 million, or 10 cents per share, in the year-earlier period, the Calgary, Alberta-based company said in a statement late yesterday.

The company ascribed the increase in funds from operations to a continued reduction in Advantage's cost structure due to development at Glacier and an increase in realized natural gas prices for the quarter and year.

Average realized price of natural gas increased to $3.39/mcf in the fourth quarter from $2.70 a year earlier, and the average crude oil and NGLs price increased to $77.01 per barrel from $65.21 per barrel.

Daily production slid to 18,122 barrels of oil equivalent, or boe/d, in the fourth quarter, from 20,749 boe/d in the year-earlier period. 

Production was impacted by minor facility outages at Glacier to accommodate field gathering system work in preparation for the eventual tie-in of new Phase VI Montney wells, the company said.

The stock, which has three "buy", one "hold" and one "underperform" recommendations from analysts, has gained 17 percent this year, giving the company a market value of C$915 million.

Quick facts: Advantage Oil & Gas Ltd.

Price: 2.1 CAD

Market: TSX
Market Cap: $395.04 m

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