Highlights:
— Funds flow from operations declined to CAD37.2 million during the first quarter of 2009 as compared to CAD79.2 million in the year-ago quarter, mainly as a result of lower realized gains on financial instruments and lower commodity prices
— Reported sales volumes for the first quarter of 2009 averaged 20,211 Boe/d as compared to 20,289 Boe/d in the year-ago quarter
— Distributions declared to unitholders for the first quarter of 2009 were CAD14.6 million or 33% of cash flow from operations (CAD28.6 million or 41% of cash flow from operations for the prior quarter)
— Capital expenditures totaled CAD37.2 million for the first quarter of 2009, resulting in 9.3 net wells drilled
— The decline in the earnings was offset by lower exploration expenditures and decreased depletion expenses caused by an impairment charge of CAD24.1 million in the fourth quarter of 2008
— Trilogy Energy received essential consents for a normal course issuer bid through the facilities of the Toronto stock exchange. Under the normal course issuer bid, Trilogy Energy may purchase up to 4,912,483 trust units during the period March 24, 2009 through March 23, 2010. No trust units were purchased through this normal course issuer bid as at March 31, 2009
— Drilled and concluded four Montney horizontal wells with initial test rates of 7MMcf/d – 9MMcf/d per well. The production rates will be optimized during the second quarter as additional compression with 10MMcf/d of capacity is installed
— During the first quarter of 2009 the Alberta government introduced the new well royalty program and the drilling royalty credit program. These favorable changes are anticipated to decrease Trilogy Energy’s royalty costs
Subsequent Events:
Holders of 1,858,059 trust units have reinvested their March 2009 distributions totaling CAD0.1 million through Trilogy Energy’s distribution reinvestment program, resulting in the issuance of an additional 16,061 trust units on April 15, 2009.
On April 15, 2009, Trilogy Energy announced its cash distribution for April 2009 at CAD0.05 per trust unit. The distribution will be paid on May 15, 2009 to unitholders of record on April 30, 2009.
