In the third quarter of 2024, Touchstone Exploration achieved an average quarterly production of 5,211 barrels of oil equivalent per day (boe/d), 75% of which was natural gas, marking a 54% increase from 3,391 boe/d in the same period in 2023. This increase was largely due to a full quarter of production from the Cascadura field, despite some natural declines in gas and associated liquids from the field.
Petroleum and natural gas sales reached US$13,253,000, an improvement from US$11,682,000 in the third quarter of 2023, driven by a 93% rise in natural gas production volumes, though this was slightly offset by lower realized pricing for crude oil and liquids. Crude oil production accounted for US$7,603,000 in petroleum sales at an average realized price of US$66.72 per barrel, while the Cascadura field contributed US$4,908,000 in natural gas sales at an average price of US$2.50 per thousand cubic feet, alongside US$306,000 from petroleum sales at US$67.15 per barrel. Additionally, the Coho-1 well generated US$436,000 from natural gas sales, averaging US$2.16 per thousand cubic feet.
The company reported an operating netback of US$7,408,000, reflecting a 23% year-over-year increase due to higher petroleum and natural gas sales, along with related royalties and a 2% decrease in operating expenses. Funds flow from operations reached US$3,024,000, up from US$2,432,000 in the same quarter of 2023, though offset by US$722,000 in transaction costs. Net earnings for the period totalled US$1,847,000 (US$0.01 per share), compared to US$988,000 (US$0.00 per share) in the prior year’s quarter.
Capital investments of US$3,068,000 were directed mainly toward the completion of two Cascadura development wells, construction of a flowline from Cascadura C to the natural gas processing facility, and the development of the Cascadura B drilling pad. Touchstone closed the quarter with a cash balance of US$6,549,000 and a net debt of US$29,593,000, with a net debt-to-funds-flow ratio of 1.25 times, well within the company’s target of 2.0 times or less. The company also expanded its Trinidad onshore assets, securing exploration and production licenses for the Charuma and Cipero Blocks.
Following the quarter-end, Touchstone reported average net volumes of 3,993 boe/d in October 2024, affected by production declines at the Cascadura-1ST1 and Cascadura-2ST1 wells and a four-day shut-in to facilitate flowline tie-ins at the Cascadura site. October sales included average natural gas volumes of 16.4 million cubic feet per day (2,726 boe/d) and crude oil and NGL sales of 1,267 barrels per day (b/d). On November 2, 2024, the company commissioned the flowline connecting the Cascadura-2ST1 and Cascadura-3ST1 wells to the natural gas processing plant and commenced production testing. Furthermore, Touchstone obtained a six-year exploration and production license with an 80% working interest in the Rio Claro Block, strategically located adjacent to its Ortoire Block. On November 9, production testing at the Cascadura-2ST1 well was completed, with continuous production set at approximately 20 million cubic feet per day of natural gas and associated natural gas liquids (NGLs), while on November 12, testing at Cascadura-3ST1 was finalized, with plans to maintain initial production at a gross rate of approximately 600 to 700 b/d of oil.
