MESSAGE TO OUR SHAREHOLDERS
As we have discussed in prior shareholder communications, we continue to face a number of headwinds in the junior oil sands sector. In addition to regulatory delays, issues relating to market access for oil produced in Canada, and investor concerns regarding the economic viability of some oil sands projects, we are now facing a period of lower oil prices which will further contribute to industry uncertainty. The uncertainty is further compounded by delays in approvals for pipelines and restrictions on foreign investment in oil sands companies under certain conditions. With these constraints recognized, our task is to work with the opportunities we have to find value for our shareholders from our 100 percent owned asset base of oil sands leases.
Our strategic process is still in progress and we continue to engage with industry participants and investors who are active in the sector. We are also active in the industry consultation process with the Alberta Energy Regulator regarding new rules for shallow SAGD projects such as Audet, our most advanced project. We are optimistic that there will be a favourable outcome for the shallow SAGD sector but the timing and content of the new rules is still undefined.
As we reported in the last quarter our Board of Directors approved a plan to significantly curtail corporate activity until some of the issues and uncertainties are resolved. We have completed the planned cost reduction measures through minimizing staff and general and administrative expenses. This should allow us to extend our cash resources and provide operating funds into 2016.
While the environment continues to be unfavourable for SilverWillow we believe we have taken the necessary steps to preserve the viability of the company and position ourselves for future opportunities as some of the challenges are resolved. We thank you, the shareholders, for remaining with SilverWillow and hope to report positive progress in the coming quarters.
President and Chief Executive Officer
Calgary, Alberta, Canada
November 20, 2014