TORONTO, March 28 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC" or the "Company") today announced that it has filed its annual audited financial statements for the twelve month period ended December 31, 2010 and related management discussion and analysis, as well as its Annual Information Form, which includes its Statement of Reserves Data and Other Oil and Gas Information. All filings can be found on SEDAR.
"In 2010, we continued to create value for our shareholders through investments in agriculture, energy and precious metals," said Kevin Bambrough, President and CEO of Sprott Resource Corp. "With the fragile economic recovery being threatened by devalued currencies and geopolitical instability, investor interest in hard assets as a store of wealth has never been higher. We believe we are well positioned to deliver value to our shareholders through our growing portfolio of resource focused companies and investments."
"We are pleased with the progress of our investments and subsidiaries during the year and are committed to continuing to invest in their future growth," continued Mr. Bambrough. "We added to our investments in the energy and agriculture sectors through One Earth Oil & Gas and Union Agriculture. The value of our gold bullion holdings continues to appreciate year over year and as a result of our successes, investors responded by exercising nearly all of our outstanding share purchase warrants for more than $67 million in proceeds. With our well capitalized balance sheet, we are positioned to continue funding our current investments and pursue new accretive business opportunities."
Achievements by SRC Subsidiaries in 2010 (and subsequent to year-end):
Orion Oil and Gas Corporation ("Orion")
Waseca Energy Inc. ("Waseca")
One Earth Farms Corp. ("One Earth Farms")
Stonegate Agricom Inc. ("Stonegate Agricom")
One Earth Oil & Gas Inc. ("OEOG")
SRC Unconsolidated Year-end 2010 Financial Highlights
As at December 31,
|Unconsolidated current assets|
|Cash and cash equivalents||$ 59,512||$ 56,169|
|Other current assets||665||613|
|Total||$ 135,569||$ 132,174|
|Unconsolidated working capital|
|Current assets||$ 135,569||$ 132,174|
|Total||$ 134,481||$ 131,144|
|Unrealized mark-to-market gains on public subsidiaries / liquid holdings1|
|Gold bullion||$ 30,205||$ 9,450|
|Total||$ 255,849||$ 9,450|
|Public investments||$ 9,334||$ 18,367|
|Total||$ 50,315||$ 33,750|
|1. Mark to market gains calculated as market value at December 31, 2010 less book (carrying) value|
| 2. Subsequent to year end, SRC sold 25 million shares (of 75.7 million common shares) for gross |
proceeds of $44 million. After giving effect to the transaction, excluding the agents' over-allotment
option, the Company retains approximately 36% on an undiluted basis.
|As at December 31, 2010, the Company had 113,405,883 common shares issued and outstanding|
About Sprott Resource Corp.
SRC is a Canadian based company, the primary purpose of which is to invest, directly and indirectly, in natural resources. Through acquisitions, joint ventures and other investments, SRC seeks to provide its shareholders with exposure to the natural resource sector for the purposes of capital appreciation and real wealth preservation. SRC is well positioned to draw upon the considerable experience and expertise of both its Board of Directors and Sprott Consulting Limited Partnership ("SCLP"), of which Sprott Inc. is the sole limited partner. Pursuant to a management services agreement between SCLP and SRC, SCLP provides day-to-day business management for SRC as well as other management and administrative services.
Forward Looking Statements
This news release includes certain forward-looking statements, including statements regarding reserves. Statements relating to "reserves" are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. These factors and assumptions include, among others: historical production in the area compared with production rates from similar producing areas; future commodity prices, production and development costs, royalties and capital expenditures; initial production rates; production decline rates; ultimate recovery of reserves; success of future exploitation activities; marketability of production; effects of government regulation; and other government levies that may be imposed over the producing life of reserves.
All forward-looking information is inherently uncertain and subject to a variety of risks, uncertainties and other factors that may cause SRC's actual results, performance or achievements to be materially different from those expressed or implied from such information, including: fluctuation in market prices for petroleum and natural gas; fluctuations in foreign exchange rates; changes in laws and regulations; geological, technical, drilling and processing problems and other difficulties in producing petroleum and natural gas reserves; uncertainties associated with estimating petroleum and natural gas reserves; and risks associated with oil and gas operations generally.
SRC has attempted to identify important factors that could cause its actual results, performance and achievements to differ materially from those contained in forward-looking statements. However, there can be other factors that cause results, performance and achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking statements and the information contained therein. SRC does not intend, and does not assume any obligation, to update these forward-looking statements except as required by law.
Barrels of Oil Equivalent
Where amounts are expressed in a barrel of oil equivalent ("boe"), or barrel of oil equivalent per day ("boe/d"), natural gas volumes have been converted to barrels of oil equivalent on the basis that 6 thousand cubic feet ("mcf") is equal to one barrel of oil. Use of the term boe may be misleading, particularly if used in isolation. This boe conversion ratio is based on an energy equivalence methodology, and does not represent a value equivalency. Indeed, the energy and value relationships may differ widely with market conditions. The conversion conforms to the Canadian Securities Regulators' National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities.
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