Cobra Venture Corporation Q3 2022 Financial Results (Ending August 31, 2022)
All information can be found on www.sedar.com
TSXV:CBV | OTCQB:CBVTF
Price: $0.17CAD - $0.126USD
Common Shares: 16,053,748
Options: 1,240,000 @ $0.135 CAD
Insider Holdings: 3,899,954 – 24.5%
Market Cap: $2.73M CAD | $2.02M USD
Website: http://www.cobraventure.com/
Q2 2022 Balance Sheet (Expressed In Canadian Dollars)
ASSETS
Cash: $2,273,478
Receivables: $174,870
Marketable Securities: $21,378
Prepaid Expenses: $30,613
Investment: $350,000
Property & Equipment: $521,731
Total Assets: $3,372,070
LIABILITIES
Accounts Payable: $35,715
Current Decommissioning: $10,125
Non-Current Decommissioning: $82,141
Total Liabilities: $127,981
2022 Performance Over 9 Months
Production Revenue: $1,428,917
Gross Profit: $760,583
Net Earnings: $372,687
Earnings Per Share: $0.023
Subject to certain restrictions, the Company has resource expenditures of approximately $2,317,000 available to reduce taxable income in future years available to apply against future taxable income. Future tax benefits which may arise as a result of the net capital losses and resource deductions have not been recognized in these financial statements.
Management Discussion Highlights (MD&A)
Net earnings for the nine-month period ended August 31, 2022, was $372,687 compared to a loss of $74,670. The net earnings for the nine-month period ended August 31, 2022, increased by 447,357 as noted below.
Oil and gas revenue for the nine-month period ended August 31, 2022 was $1,428,917 compared to $908,208 in the comparative nine-month period ended August 31, 2021. The $520,709 increase in production revenue was primarily due to the return of production revenue from pre-pandemic Covid-19 levels where certain of the Company’s operators elected to shut-in certain of their operating batteries due to the Covid-19 outbreak in the November 2020 comparative period and increasing oil and gas prices.
Gull Lake, Saskatchewan
During the year ended November 30, 2013, the Company entered into a Participation Agreement whereby the Company (and two other arm’s length companies) was granted the right to equally participate to drill and complete up to 4 initial test wells (each “Test Well”) located in Gull Lake, Saskatchewan. Under the agreement, the Company had to pay 29.33% of the drilling costs of each Test Well to earn a net working interest of 14.665% in each well. The Company currently maintains a 14.665% interest in the Gull Lake project area.
During the year ended November 30, 2015, the Company recorded an impairment charge of $664,978 on the property due to a sustained decline in forecasted crude oil prices. The impairment was determined using a value in use approach using estimated expected cash flow based on proved plus probable reserves using a pre-tax discount rate of 10%.
During the year ended November 30, 2016, the Company recorded an impairment charge on the property of $98,917 due to a sustained decline in forecasted crude oil and natural gas prices.
The Company currently participates in 12 wells, 7 wells of which are operated by Taku Gas Ltd. ("Taku"
, and 5 wells operated by Vital Energy Ltd. ("Vital" . As well, the Company has also elected to participate in the drilling of two development well locations. The additional wells will target the primary producing reservoir in the wells operated by Vital. Following the drilling of these two wells, and evaluation of the well results, Cobra has the option to elect to further participate in the drilling of a horizontal well.
During the year ended November 30, 2021, the Company recorded $1,589,972 (2020 - $976,326) in production revenue.
During the period ended August 31, 2022, the Company recorded $1,428,917 (2021- $908,208) in production revenue.
San Joaquin Basin Project, California
As initially discussed in August 2019, Cobra entered into a participation agreement (the “Agreement”) with Makk Energy Ltd., a private oil and gas company controlled by Murray Rodgers, a Director of Cobra and QC Energy LLC, a private oil and gas company based in Denver, Colorado. Pursuant to the Agreement, Cobra has a nonoperating 25% working interest in the subject project. In early 2020, the joint venture group undertook an initiative to attract a strategic partner to fund leasing and drilling activity in the project area. While these initiatives were initially promising (with technical due diligence being concluded with favourable outcomes), the recent outbreak of Covid-19 pandemic, combined with the significant declines in the oil equity markets, has resulted in a pullback of interest in the project. The joint venture partners will continue to pursue new sources of capital for this project while working within the current global and local uncertainties surrounding oil and gas investments.
MARKETABLE SECURITIES
Investments are marketable securities comprised of 475,076 (November 30, 2021 – 475,076) common shares in Magnum Goldcorp Inc., a publicly traded company. The Company and Magnum Goldcorp Inc. have certain directors in common.
INVESTMENT
At August 31, 2022, the Company had 350,000 shares (November 30, 2021 - 350,000) of Star Valley Drilling Ltd, a privatelyowned company, valued at $350,000 (November 30, 2021 - $350,000) classified as FVTPL. As there is no quoted market price in an active market for the investment, the investment was initially measured at fair value which was the price paid by the company. There are no indicators during the current and prior year that cost might not be representative of fair value.
All information can be found on www.sedar.com
TSXV:CBV | OTCQB:CBVTF
Price: $0.17CAD - $0.126USD
Common Shares: 16,053,748
Options: 1,240,000 @ $0.135 CAD
Insider Holdings: 3,899,954 – 24.5%
Market Cap: $2.73M CAD | $2.02M USD
Website: http://www.cobraventure.com/
Q2 2022 Balance Sheet (Expressed In Canadian Dollars)
ASSETS
Cash: $2,273,478
Receivables: $174,870
Marketable Securities: $21,378
Prepaid Expenses: $30,613
Investment: $350,000
Property & Equipment: $521,731
Total Assets: $3,372,070
LIABILITIES
Accounts Payable: $35,715
Current Decommissioning: $10,125
Non-Current Decommissioning: $82,141
Total Liabilities: $127,981
2022 Performance Over 9 Months
Production Revenue: $1,428,917
Gross Profit: $760,583
Net Earnings: $372,687
Earnings Per Share: $0.023
Subject to certain restrictions, the Company has resource expenditures of approximately $2,317,000 available to reduce taxable income in future years available to apply against future taxable income. Future tax benefits which may arise as a result of the net capital losses and resource deductions have not been recognized in these financial statements.
Management Discussion Highlights (MD&A)
Net earnings for the nine-month period ended August 31, 2022, was $372,687 compared to a loss of $74,670. The net earnings for the nine-month period ended August 31, 2022, increased by 447,357 as noted below.
Oil and gas revenue for the nine-month period ended August 31, 2022 was $1,428,917 compared to $908,208 in the comparative nine-month period ended August 31, 2021. The $520,709 increase in production revenue was primarily due to the return of production revenue from pre-pandemic Covid-19 levels where certain of the Company’s operators elected to shut-in certain of their operating batteries due to the Covid-19 outbreak in the November 2020 comparative period and increasing oil and gas prices.
Gull Lake, Saskatchewan
During the year ended November 30, 2013, the Company entered into a Participation Agreement whereby the Company (and two other arm’s length companies) was granted the right to equally participate to drill and complete up to 4 initial test wells (each “Test Well”) located in Gull Lake, Saskatchewan. Under the agreement, the Company had to pay 29.33% of the drilling costs of each Test Well to earn a net working interest of 14.665% in each well. The Company currently maintains a 14.665% interest in the Gull Lake project area.
During the year ended November 30, 2015, the Company recorded an impairment charge of $664,978 on the property due to a sustained decline in forecasted crude oil prices. The impairment was determined using a value in use approach using estimated expected cash flow based on proved plus probable reserves using a pre-tax discount rate of 10%.
During the year ended November 30, 2016, the Company recorded an impairment charge on the property of $98,917 due to a sustained decline in forecasted crude oil and natural gas prices.
The Company currently participates in 12 wells, 7 wells of which are operated by Taku Gas Ltd. ("Taku"
, and 5 wells operated by Vital Energy Ltd. ("Vital" . As well, the Company has also elected to participate in the drilling of two development well locations. The additional wells will target the primary producing reservoir in the wells operated by Vital. Following the drilling of these two wells, and evaluation of the well results, Cobra has the option to elect to further participate in the drilling of a horizontal well. During the year ended November 30, 2021, the Company recorded $1,589,972 (2020 - $976,326) in production revenue.
During the period ended August 31, 2022, the Company recorded $1,428,917 (2021- $908,208) in production revenue.
San Joaquin Basin Project, California
As initially discussed in August 2019, Cobra entered into a participation agreement (the “Agreement”) with Makk Energy Ltd., a private oil and gas company controlled by Murray Rodgers, a Director of Cobra and QC Energy LLC, a private oil and gas company based in Denver, Colorado. Pursuant to the Agreement, Cobra has a nonoperating 25% working interest in the subject project. In early 2020, the joint venture group undertook an initiative to attract a strategic partner to fund leasing and drilling activity in the project area. While these initiatives were initially promising (with technical due diligence being concluded with favourable outcomes), the recent outbreak of Covid-19 pandemic, combined with the significant declines in the oil equity markets, has resulted in a pullback of interest in the project. The joint venture partners will continue to pursue new sources of capital for this project while working within the current global and local uncertainties surrounding oil and gas investments.
MARKETABLE SECURITIES
Investments are marketable securities comprised of 475,076 (November 30, 2021 – 475,076) common shares in Magnum Goldcorp Inc., a publicly traded company. The Company and Magnum Goldcorp Inc. have certain directors in common.
INVESTMENT
At August 31, 2022, the Company had 350,000 shares (November 30, 2021 - 350,000) of Star Valley Drilling Ltd, a privatelyowned company, valued at $350,000 (November 30, 2021 - $350,000) classified as FVTPL. As there is no quoted market price in an active market for the investment, the investment was initially measured at fair value which was the price paid by the company. There are no indicators during the current and prior year that cost might not be representative of fair value.
