Operating and Transportation ExpensesOperating and transportation expenses include all costs associated with the production of oil and natural gas and the transportation of oil and natural gas to the processing plants. The major components of operating expenses include labour, equipment maintenance, workovers, fuel and power. Operating and transportation expenses for Q3 2012 increased to $1,209,000 from $664,000 for Q3 2011. The increase was due to the expenditures associated with a major workover on one of the oil producing wells, increased repairs and maintenance of oil wells, and higher waterflood activity. Net Loss and Operating Loss The Company’s net loss for the current quarter was $1,365,000 or $0.009 per share, compared to a net loss of $346,000 or $0.003 per share for the same quarter in 2011. The Company’s operating loss for the current quarter was $1,372,000, compared to $48,000 for Q3 2011. The increase in net loss and operating loss was primarily due to the reduction in revenues. This was partly offset by the decrease in finance costs. Cash Balance and Bank Line of Credit The Company had cash and cash equivalents of $3,026,000 as at September 30, 2012. In addition to the cash balance, the Company has an unused line of credit limit of $1.3 million from a Canadian Bank. In September 2011, the Company obtained a $7 million revolving operating demand loan (“line of credit”). The line of credit is at an interest rate of Prime + 1% (total 4% p.a. currently). In October 2012, the Company renewed the line of credit with the Canadian Bank. Per the amended agreement, the maximum amount of the line of credit is reduced to $6.9 million, including a letter of credit facility to a maximum of $600,000 for a maximum one year team. The availability of the line of credit is reduced by $100,000 per month commencing November 1, 2012. The next review date is scheduled on or before February 15, 2013, but subject to change at the discretion of the bank. As at September 30, 2012, a total of $5.7 million of this facility was utilized.