Epsilon Energy Ltd
For the period ended Sep 30, 2024. Filed Nov 6, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 6, 2024
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Operating Costs
The following table presents total cost and cost per unit of production (Mcfe), including ad valorem, severance, and production taxes for the three and nine months ended September 30, 2024 and 2023:
| | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| · · Three months ended September 30, · · Nine months ended September 30, | ||||||||||||
| · 2024 · 2023 · 2024 · 2023 | ||||||||||||
| Lease operating costs (net of elimination) | | $2,099,501 | | $1,559,957 | | $5,517,830 | | $4,404,757 | ||||
| Gathering system operating costs | | | 490,325 | | | 631,725 | | | 1,692,862 | | | 1,854,000 |
| | | $2,589,826 | | $2,191,682 | | $7,210,692 | | $6,258,757 | ||||
| | | | | | | | | | | | | |
| Upstream operating costs—Total $/Mcfe | | | 1.22 | | | 0.79 | | | 1.00 | | | 0.66 |
| Gathering system operating costs $/Mcf | | | 0.23 | | | 0.15 | | | 0.39 | | | 0.16 |
Operating costs include the effects of elimination entries to remove the gathering fees paid to Epsilon’s ownership in the gathering system.
Upstream operating costs consist of lease operating expenses necessary to extract natural gas and oil, including gathering and treating the natural gas and oil to ready it for sale. For the nine months ended September 30, 2024 these costs increased by $1.1 million, or 25%, over the same period in 2023. The increase is primarily due to the acquired and developed wells in the Permian Basin during the fourth quarter of 2023 and 2024. For the three months ended September 30, 2024 these costs increased by $0.5 million, or 35%, over the same period in 2023. The increase is primarily due to the acquired and developed wells in the Permian Basin during the fourth quarter of 2023 and 2024.
The higher unit operating costs in the three and nine months ending September 30, 2024 were primarily due to the higher liquids proportion of sales (Mcfe).
Gathering system operating costs consist primarily of rental payments for the natural gas fueled compression units and overhead fees due to the system’s operator. For the nine months ended September 30, 2024, gathering system operating costs were constant, decreasing by $0.2 million, or 9% from the same period in 2023. For the three months ended September 30, 2024, gathering system operating costs decreased by $0.1 million, or 22% from the same period in 2023. The decrease related to lower throughput volumes.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.