VANCOUVER, BC, May 6, 2026 /CNW/ - ShaMaran Petroleum Corp. ("ShaMaran" or the "Company") (TSXV: SNM) (Nasdaq First North: SNM) today released its financial and operating results and related management's discussion and analysis ("MD&A") for the three months ended March 31, 2026. PDF Version
Garrett Soden, President and CEO of ShaMaran, commented: "ShaMaran had a solid start to 2026 on the back of operational strength at Atrush and higher price realizations from international export sales. Unfortunately, the Iran war has severely impacted the Kurdistan region with most international oil companies shut-in since early March. Together with our operating partner, HKN, we remain focused on ensuring the safety of personnel, reducing operating expenditures and non-critical activities while maintaining readiness to restart production when the security situation allows. In the meantime, the closure of the Strait of Hormuz has highlighted the critical importance of the Iraq-Türkiye export pipeline as an outlet for all Iraqi crude."
Mr. Soden continued: "As previously announced, shareholders approved the proposals to move the Company's primary listing from Toronto to Oslo and to effect a corporate continuance from Canada to Bermuda. We will proceed with that process shortly."
Corporate Highlights:
-- On March 2, 2026, the Company announced a temporary production shut-in at
both the Atrush and Sarsang blocks as a precautionary measure due to the
regional security environment related to the Iran war. Other
international oil companies ("IOCs") in the region have also announced
temporary production shut--ins since early March, with only a fraction of
the pre-Iran war oil volumes being exported from the Kurdistan Region of
Iraq ("KRI") via the Iraq-Türkiye pipeline ("ITP");
-- The Company announced on March 5, 2026, an explosion at one of the
processing facilities in the Sarsang field and on April 1, 2026, an
explosion at one of the storage facilities in the Sarsang field. All
personnel were safely accounted for, and no injuries were reported;
-- International oil exports from the KRI through the ITP restarted on
September 27, 2025, and continue in line with the interim agreements
executed between the Kurdistan Regional Government ("KRG"), Government of
Iraq and IOCs, including ShaMaran.
-- IOCs are entitled to receive export payments "in-kind" under the
interim agreements, with cargoes sold by the IOC--appointed
marketing firm on a regular basis and payments for the sales
received approximately 30 days after each lifting. There have been
no delays in receiving payment from the Iraqi State Organization
for Marketing of Oil ("SOMO") as part of the interim agreements
since the start of exports in September 2025.
-- The interim agreements were extended to June 30, 2026, in order to
facilitate the reconciliation of IOC invoices with the respective
production sharing contracts ("PSCs") by the appointed
international consulting firm. IOCs expect full PSC entitlement
payment when the review is completed.
-- On March 10, 2026, the Company announced shareholder approval for the
continuance of the Company from Canada to Bermuda and the delisting of
the Company's shares from the TSXV. Following the continuance to Bermuda,
the Company plans to list its shares on the Euronext Growth Oslo market
operated by the Oslo Stock Exchange while maintaining the Company's
secondary listing on the Nasdaq First North in Stockholm. Once ShaMaran
completes both transactions, the Company will no longer be incorporated
in British Columbia and subject to the laws of Canada, it will cease to
be listed on the TSXV, and it will no longer be a reporting issuer in any
jurisdiction in Canada. ShaMaran will instead be incorporated in and
subject to the laws of Bermuda.
Financial Highlights:
Three months ended March 31,
USD Thousands 2026 2025
Revenue 38,031 35,885
Gross margin on oil sales 22,698 12,476
Net cash flow from operating
activities 21,423 32,032
Adjusted EBITDAX(1) 28,128 24,465
-- Revenue in Q1 2026 was $38.0 million (6% higher than the $35.9 million in
Q1 2025) primarily due to oil sales at international prices following the
restart of pipeline exports. Production has been suspended since March 2,
2026, impacting revenue in Q1 2026;
-- Gross margin on oil sales in Q1 2026 was $22.7 million (82% higher than
the $12.5 million in Q1 2025) mainly due to Q1 2026 pipeline export sales
at international pricing and lower costs due to the shut--in;
-- Net cash flow from operating activities in Q1 2026 was $21.4 million (33%
lower than the $32.0 million in Q1 2025) mainly from pipeline export
interim payments. The decrease is due to timing of cash receipts for
pipeline export sales, as well as higher expenditures related to drilling,
debottlenecking and maintenance works on both blocks;
-- Adjusted EBITDAX(1) in Q1 2026 was $28.1 million (15% higher than the
$24.5 million in Q1 2025) due to a combination of the effects described
above and lower corporate costs;
-- At March 31, 2026, the Company had cash of $36.5 million and gross debt
(corporate bond) of $143.8 million. Net debt2 was $107.2 million, and
-- At May 6, 2026, the Company has cash of $40.7 million and gross debt of
$143.8 million. Net debt(2) is $103.1 million.
_____________________
(1) Adjusted EBITDAX is a non-IFRS financial measure.
Refer to "Non-IFRS Accounting Standards Measures"
below for more information.
(2) Net debt is a non-IFRS financial measure. Refer to
"Non-IFRS Accounting Standards Measures" below for
more information.
Operational Highlights:
Three months ended March 31, Three months ended
Dec 31,
2026 2025 2025
Average daily oil
production -- gross
100% field (Mbopd)
AtrushSarsang 20.615.3 35.329.9 30.227.1
Total 35.9 65.2 57.3
Average daily oil
production --
Company net (Mbopd)
Atrush (50%)Sarsang 10.32.8 17.65.4 15.14.9
(18%)
Total 13.1 23.0 20.0
Oil sales -- gross
100% field (Mbbl)
AtrushSarsang 1,8521,357 3,1752,705 2,7752,451
Total 3,209 5,880 5,226
-- At Atrush, average gross daily oil production in Q1 2026 was 20.6 Mbopd;
-- At Sarsang, average gross daily oil production in Q1 2026 was 15.3 Mbopd;
-- Average gross daily oil production from Atrush and Sarsang in Q1 2026 on
a combined basis was 35.9 Mbopd (45% lower than the 65.2 Mbopd in Q1
2025) primarily due to the shut-in from the beginning of March 2026 and
lower production at the Sarsang Block;
-- Average Company net daily oil production from Atrush and Sarsang in Q1
2026 on a combined basis was 13.1 Mbopd (43% lower than the 23.0 Mbopd in
Q1 2025) primarily due to the shut-in from the beginning of March 2026
and lower production at the Sarsang Block;
-- The operator expects that Atrush will be able to produce at full capacity
shortly after field operations restart. Sarsang is expected to restart at
reduced capacity, with full production to be reached in phases over
several months, as damage assessment is complete and repairs or
modifications are made; and
-- Operational plans for the remainder of 2026, including drilling and other
capital expenditures, are contingent on the security environment in the
region. The operating plans for 2026 are also contingent on the
continuation of the ITP export deal reached with SOMO in 2025, including
completion of the reconciliation work by the appointed international
consultant and receipt of full PSC entitlement by IOCs, as well as the
extension or renegotiation of the ITP agreement between Iraq and Turkey
prior to its expiry in July 2026.
Subsequent events:
-- On April 1, 2026, the Company announced an explosion at one of the
storage facilities in the Sarsang field. All personnel were safely
accounted for, and no injuries were reported. Both the Atrush and Sarsang
blocks remain shut-in due to the regional security environment, and there
is no certainty as to the duration of the shut-in. HKN Energy Ltd.
("HKN"), the operator of the blocks, plans to restart production as soon
as safe and secure operations are possible.
Abbreviations:
Mbbl Thousand barrels of crude oil Mbopd Thousand barrels of crude oil per day USD United States dollar
ShaMaran plans to publish its financial statements for the six months ending June 30, 2026, on August 5, 2026. Except as otherwise indicated, all currency amounts indicated as "$" in this news release are expressed in United States dollars.
Non-IFRS Accounting Standards Measures
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