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Erin Energy Corporation - Erin Provides Operational Update And 3rd Quarter 2015 Results

Release Date: 10/11/2015 08:27:00      Code(s): ERN     
Erin Energy Corporation
(Formerly CAMAC Energy Inc)
(Incorporated and registered in Delaware, United States of America)
Share code on the NYSE MKT: ERN
Share code on the JSE: ERN
ISIN: US1317452001
(?Erin Energy? or ?the Company?)

Erin Energy Announces Third-Quarter 2015 Results
Provides Operational Update on its West and East Africa Operations

HOUSTON, November 9, 2015 - Erin Energy Corporation (Erin Energy or the Company) (NYSE
MKT:ERN) (JSE:ERN) announced today financial and operational results for the quarter ended
September 30, 2015. The Company has filed its Form 10-Q for the third quarter 2015 with the
Securities and Exchange Commission.

Highlights:

- First revenues from Oyo redevelopment campaign on crude sales volumes of 571,000 barrels;

- Gross production of approximately 1.1 million barrels of oil;

- Completed 3-D seismic acquisition on The Gambia A2 and A5 blocks;

- In-place volumes of approximately 500 MMbbls and 282 BCF of gas offshore Ghana;

- Moved into next phase of exploration of onshore Kenya blocks L1B and L16;

- Extended exploration period on offshore Kenya blocks L27 and L28.

 ?During the quarter, we produced approximately 1.1 million barrels of oil and sold 571,000
barrels, generating revenues of more than $28 million.? said Kase Lawal, Chairman and Chief
Executive Officer. ?Growth is at the center of the Erin Energy story and we are positioning
ourselves now to create value, to capitalize on lower costs in the current market, and to
accelerate our activity so that we are in the right place for when the market begins to reward
growth again.?

Operations Summary

During the quarter, Erin Energy?s sales volumes of crude totaled 571,000 barrels of oil, net to
the Company. Average daily production was approximately 10,200 barrels of oil per day
(BOPD), net to the Company (~11,600 BOPD gross).

In The Gambia, the Company completed an acquisition of 1,613 square kilometer 3-D seismic
data over its offshore A2 and A5 blocks, which is currently being processed and is a key step in
high-grading the asset.

Based on the Company?s interpretation of the 2-D seismic acquired on its onshore Kenya
blocks, Erin Energy moved to the next exploration phase and entered the First Additional
Exploration Period (FAEP) of both onshore blocks, L1B and L16. Additionally, Erin Energy was

                                                 1
granted an 18-month extension of the Initial Exploration Period for its offshore Kenya blocks L27
and L28 in order to seek a farm-in partner and to acquire 3-D seismic data.

In Ghana, the Company completed its economic and commercial evaluation of the three
previously discovered oil fields on the Expanded Shallow Water Tano block. Subsequent to third
quarter end, Erin Energy announced the total discovered in-place volumes have been assessed
and approximately 500 million barrels of oil and 282 BCF of gas. The Company is working with
its joint venture partners and relevant government entities on further optimization studies to
enhance the development and exploration opportunities.

Financial Summary

For the quarter, Erin Energy reported revenues of $28.7 million, up 50% from the third quarter
2014. In the third quarter 2015, the Company lifted and sold approximately 571,000 net barrels
of oil at an average price of $50.2 per barrel. For the same period in 2014, the Company sold
approximately 189,000 net barrels of oil at an average price of $100.9 per barrel.

Erin Energy reported a net loss of $58.7 million, or $0.28 per basic and diluted share.
Production expense for the third quarter of 2015 was $28.0 million compared with 34.3 million
during the same period 2014.

Conference Call and Webcast

The Company will host a conference call on Tuesday, November 10, 2015 at 10 a.m. CT (11
a.m. ET) to discuss third quarter results and current operations. The dial-in number is 1 877-
270-2148 in the United States or +1 412-902-6510 internationally. A live audio webcast of the
call can be accessed on the Investors page of Erin Energy?s website at
erinenergy.eventsandpresentations.com. A replay of the webcast will be available on Erin
Energy?s website for approximately one year following the event.

Erin Energy Corporation is an independent oil and gas exploration and production company
focused on energy resources in sub-Saharan Africa. Its asset portfolio consists of 9 licenses
across 4 countries covering an area of 40,000 square kilometres (10 million acres), including
current production and other exploration projects offshore Nigeria, as well as exploration
licenses offshore Ghana, Kenya and The Gambia, and onshore Kenya. Erin Energy is
headquartered in Houston, Texas, and is listed on the New York and Johannesburg Stock
Exchanges under the ticker symbol ERN. More information about Erin Energy can be found at
www.erinenergy.com.

Oil-in-Place Estimates
This press release refers to volumes of discovered oil- and gas-in-place. The Securities and
Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to
disclose only ?reserves,? as that term is defined under SEC rules. Discovered petroleum
initially-in-place is that quantity of petroleum that is estimated, as of a given date, to be
contained in known accumulations prior to production. The recoverable portion of discovered
petroleum initially-in-place is subject to application of recovery efficiency factors and economic
analysis before any such volumes can be categorized as reserves. There is no certainty that
any such volumes will ultimately be categorized as reserves or that it will be commercially viable
to produce any portion of the petroleum initially-in-place.
Forward-Looking Statements


                                                2
This news release contains ?forward-looking statements? within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All
statements, other than statements of historical fact, concerning activities, events or
developments that the Company expects, believes or anticipates will or may occur in the future
are forward-looking statements. Although the Company believes the expectations reflected in
these forward-looking statements are reasonable, they involve assumptions, risks and
uncertainties, and these expectations may prove to be incorrect.

The Company?s actual results could differ materially from those anticipated or implied in these
forward-looking statements due to a variety of factors, including the Company?s ability to
successfully finance, drill, produce and/or develop the wells and prospects identified in this
release, and risks and other risk factors discussed in the Company?s periodic reports filed with
the Securities and Exchange Commission. All forward-looking statements are expressly
qualified in their entirety by this cautionary statement. You should not place undue reliance on
forward-looking statements, which speak only as of their respective dates. The Company
undertakes no duty to update these forward-looking statements.

Source: Erin Energy Corporation

Contact:
Lionel McBee, +1 713 797 2960
lionel.mcbee@erinenergy.com

Chris du Toit, +27 11 593 7301
chris.dutoit@erinenergy.com

ERIN ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)




                                               3
                                                               Three Months Ended           Nine Months Ended
                                                                  September 30,               September 30,
                                                               2015          2014           2015          2014
Revenues:
  Crude oil sales, net of royalties                    $         28,667 $      19,010 $       28,667 $      53,844
Operating costs and expenses:
  Production costs                                               28,019        34,261         43,731        72,617
  Workover expenses                                                 354            ?             972            ?
  Exploratory expenses                                            5,266         1,148         13,283         3,851
  Depreciation, depletion and amortization                       43,815        21,720         44,934        32,676
  Loss on settlement of asset retirement obligations                779            ?           4,233            ?
  General and administrative expenses                             3,857         3,427         12,789        12,200
     Total operating costs and expenses                          82,090        60,556        119,942       121,344
Operating loss                                                  (53,423)      (41,546)       (91,275)      (67,500)
Other income (expense):
  Currency transaction gain                                         176              394       2,167           426
  Interest expense                                               (5,650)            (771)    (12,485)       (1,637)
  Other, net                                                         ?              (300)         ?           (300)
      Total other income (expense)                               (5,474)            (677)    (10,318)       (1,511)
Loss before income taxes                                        (58,897)      (42,223)      (101,593)      (69,011)
Income tax expense                                                   ?             ?              ?             ?
Net loss before non-controlling interest                        (58,897)      (42,223)      (101,593)      (69,011)
   Net loss attributable to non-controlling interest                  215            ?             690           ?
   Net loss attributable to Erin Energy Corporation    $        (58,682) $    (42,223) $    (100,903) $    (69,011)
Net loss per common share:
  Basic                                                $          (0.28) $      (0.20) $       (0.48) $      (0.40)
  Diluted                                              $          (0.28) $      (0.20) $       (0.48) $      (0.40)
Weighted average common shares outstanding:
  Basic                                                         211,517       210,274        211,036       174,247
  Diluted                                                       211,517       210,274        211,036       174,247



    ERIN ENERGY CORPORATION
    CONSOLIDATED BALANCE SHEETS
    (Unaudited)
    (In thousands, except for share and per share amounts)




                                                           4
                                                                                September 30,       December 31,
                                                                                     2015               2014
ASSETS
Current Assets:
   Cash and cash equivalents                                                $             4,201 $           25,143
   Restricted cash                                                                        9,277              1,496
   Accounts receivable - partners                                                           145                496
   Accounts receivable - related party                                                      624                624
   Accounts receivable - other                                                               50                 54
   Crude oil inventory                                                                   36,694              1,089
   Prepaids and other current assets                                                      1,815              2,929
       Total current assets                                                              52,806             31,831
Property, plant and equipment:
Oil and gas properties (successful efforts method of accounting), net                   659,330            595,269
Other property, plant and equipment, net                                                  1,169              1,060
       Total property, plant and equipment, net                                         660,499            596,329
Other non-current assets:
   Restricted cash                                                                           ?               8,909
   Debt issuance costs                                                                    1,044              1,307
   Other non-current assets                                                                  67                 67
       Other assets, net                                                                  1,111             10,283
       Total assets                                                         $           714,416 $          638,443
LIABILITIES AND EQUITY
Current Liabilities:
   Accounts payable and accrued liabilities                                 $           188,918 $          108,047
   Accounts payable and accrued liabilities - related party                              26,154              9,391
   Accounts payable - partners                                                               35                 ?
   Asset retirement obligations                                                              ?              12,703
   Current portion of long-term debt                                                     24,609              6,200
   Short-term note payable - related party                                                2,000                 ?
   Short-term borrowings                                                                 11,303                 ?
       Total current liabilities                                                        253,019            136,341
Long-term notes payable - related party                                                 119,352             61,185
Term loan facility                                                                       73,827             93,000
Asset retirement obligations                                                             24,360             13,830
Other long-term liabilities                                                                  ?                  82
       Total liabilities                                                                470,558            304,438
Commitments and contingencies
Equity:
    Preferred stock $0.001 par value - 50,000,000 shares
 authorized; none issued and outstanding at September 30, 2015 and
 December 31, 2014                                                                          ?                      ?
   Common stock $0.001 par value - 416,666,667 shares
 authorized; 211,562,664 and 210,307,502 shares
 outstanding as of September 30, 2015 and December 31, 2014                                212                 210
   Additional paid-in capital                                                           788,986            778,095
   Accumulated deficit                                                                 (545,857)          (444,954)
      Total equity - Erin Energy Corporation                                            243,341            333,351
   Non-controlling interests                                                                517                654
      Total equity                                                                      243,858            334,005
      Total liabilities and equity                                          $           714,416 $          638,443

     ERIN ENERGY CORPORATION
     CONSOLIDATED STATEMENTS OF CASH FLOWS
     (Unaudited)
     (In thousands)


                                                                        5
                                                                                      Nine Months Ended
                                                                                        September 30,
                                                                                      2015             2014
Cash flows from operating activities
Net loss, including non-controlling interest                                      $   (101,593) $       (69,011)
Adjustments to reconcile net loss to cash used in operating activities:
  Depreciation, depletion and amortization                                              43,536           31,327
  Accretion of asset retirement obligations                                              1,398            1,349
  Amortization of debt discount and debt issuance costs                                  1,920               ?
  Loss on settlement of asset retirement obligations                                     4,233               ?

   Share-based compensation                                                              4,398            2,216
   Related party liability offset                                                           ?           (32,880)
   Payments to settle asset retirement obligations                                     (17,220)              ?
   Other                                                                                    ?                21
   Change in operating assets and liabilities:
     Decrease (increase) in accounts receivable                                            390              (10)
     Decrease (increase) in inventories                                                 (9,493)          13,715
     Decrease (increase) in prepaids and other current assets                              324           (7,103)
     Increase in accounts payable and accrued liabilities                               58,126           27,277
         Net cash used in operating activities                                         (16,148)         (33,099)
Cash flows from investing activities
Capital expenditures                                                                   (83,156)         (59,481)
Allied transaction                                                                          ?          (170,000)
          Net cash used in investing activities                                        (83,156)        (229,481)
Cash flows from financing activities
Proceeds from the issuance of common stock                                                  ?           270,000
Proceeds from exercise of stock options and warrants                                     1,855              415
Proceeds from term loan facility                                                            ?            50,000
Proceeds from notes payable - related party, net                                        63,815           10,649
Proceeds from short-term borrowings, net                                                11,303               ?
Debt issuance costs                                                                         ?            (1,943)
Allied transaction adjustments                                                              ?           (12,440)
Funding from non-controlling interest                                                      553               ?
          Net cash provided by financing activities                                     77,526          316,681
Effect of exchange rate changes on cash and cash equivalents                                 836              ?
Net increase (decrease) in cash and cash equivalents                                   (20,942)          54,101
Cash and cash equivalents at beginning of period                                        25,143              163
Cash and cash equivalents at end of period                                        $      4,201 $         54,264
Supplemental cash flow information
Cash paid for:
 Interest, net                                                                    $      7,886 $              8
Non-cash investing and financing activities:
 Issuance of common shares for settlement of liabilities                          $        125     $         ?
 Discount on notes payable pursuant to issuance of warrants                       $      4,911     $         ?
 Related party liability offset                                                   $         ?      $     32,880
 Reduction in accounts payable from settlement of Northern Offshore contingency   $     24,307     $         ?

    10 November 2015

    Sponsor
    Sasfin Capital (a division of Sasfin Bank Limited)


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Date: 10/11/2015 08:27:00 Supplied by www.sharenet.co.za                     
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