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    Kiwetinohk Energy sees Q3 production gains, net loss


Considering sale of interests or entire projects to maximise shareholder value.

by: Dale Lunan

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Natural Gas & LNG News, Americas, Energy Transition, Corporate, Investments, Financials, News By Country, Canada

Kiwetinohk Energy sees Q3 production gains, net loss

Canadian energy transition company Kiwetinohk Energy said November 8 it had higher natural gas and liquids production in Q3 2023 but saw a net loss of C$12.06mn against net income of C$55.4mn in the same period last year.

Total production for the quarter rose to 21,218 barrels of oil equivalent (boe)/day from 16,487 boe/day, with natural gas production increasing to 72.5mn ft3/day from 53.9mn ft3/day.

Kiwetinohk has a project pipeline consisting of about 1,225 MW of gas-fired generating capacity and 920 MW of solar energy capacity which it believes “will contribute to more efficient and cleaner power generation” in Alberta.

But virtually all those projects are now in limbo given the Canadian government’s proposed Clean Electricity Regulations (CER), and apart from sustaining investments in the 400 MW Homestead solar project and the 101 MW gas-fired Opal peaker plant project, Kiwetinohk will defer additional expenditures on its remaining projects while it awaits clarity on those regulations.

A final investment decision (FID) on the Homestead project will have to await the results of an Alberta Utilities Commission (AUC) hearing on an associated transmission line, while FID for Opal awaits transmission line approval and an assessment of CER impacts on the project. FID for both is not expected until at least the second half of 2024, Kiwetinohk said.

In the meantime, it said its “early mover” activities in the energy transition space has allowed it to develop, for about C$40mn so far, opportunities in the upstream and power business which for the most part can’t be recreated “in the current environment.”

“As a result, our opportunities far exceed our ability to finance the entire portfolio,” said. “The best thing to do is to sell interests or entire projects to finance remaining projects and maximise shareholder value.”

To that end, it sold non-core producing assets in the Rimbey area of Central Alberta on November 1 for estimated proceeds of C$17.6mn. The assets represented less than 1% of 2P reserves and about 1% of corporate production through the first nine months of 2023.