By: Tomas Ronolski - AllPennyStocks.com News

Thursday, April 30, 2015

Oil prices have surged recently, with Brent crude hitting $66 per barrel and WTI crude crossing $59.1 per barrel. The recovery has been sparked by a range of factors, most important of which is the monetary easing measures in China. Despite the surge, oil prices are still 40% below the levels they traded nearly a year-ago. Oil producers have significantly cut capital spending. Lower oil prices have also forced them to record significant impairment charges. Earlier today, New Zealand Energy Corp. (TSX-Venture:NZ) (OTCQX:NZERF), which is engaged in the production, exploration and development of conventional and unconventional natural gas resources in New Zealand, recorded a significant impairment charge for 2014.

NZ, which also operates midstream assets, filed its 2014 year-end consolidated financial results with Canadian regulatory authorities today. In the filing, the company noted that its consolidated loss, before the impact of exchange rate, was C$84.10 million for 2014. The company’s balance sheet also saw some significant changes at the end of 2014, when compared to 2013. This was because the company had to significantly reduce net asset positions arising from impairment to the carrying values of its concessions.

At the end of 2014, impairment charges to Exploration and Evaluation Assets have been valued at C$50.6 million. Impairment charges for Property, Plant and Equipment have been valued at C$26.5 million. This takes the company’s total impairment charges to C$77.1 million for the year ended December 31, 2014.

Commenting on this, James Willis, Chairman of the New Zealand Energy Board, said now that the company has cleared the decks, its focus is on opportunities which lend themselves to step changes in its production and reserves.

New Zealand Energy’s revenue for 2014 was C$14.13 million, compared to revenue of C$10.7 million reported for 2013. Total comprehensive loss for the year ended 2014 was C$79.22 million, compared to C$9.30 million reported in 2013. The company burned nearly C$2 million in 2014, down more than C$4 million as reported last year. At the end of 2014, NZ had C$1.12 million in cash on its balance sheet, down from C$4.90 million reported at the end of 2013.

New Zealand Energy has also announced changes to its senior management team recently. Last week, NZ announced that its CEO, David Robinson will resign. Robinson will retire as a Director before the company’s Annual General Meeting in mid-June 2015.

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