November 12, 2009 / 11:20 PM / 9 years ago

UPDATE 1-Petroflow Energy says in breach of debt covenants

* Q3 loss C$0.30/shr vs EPS C$0.41 a yr-ago

* Says bank loan reclassified as a current liability

Nov 12 (Reuters) - Canada’s Petroflow Energy Ltd PEF.TO said it was not in compliance with its debt covenants and needed to raise $18 million by Dec. 17 to reduce debt as part of an amended agreement with its lenders.

As a result of its noncompliance, the company said its bank loan has been reclassified as a current liability.

The company said its ability to continue as a going concern will be dependent on various factors, including securing ongoing debt and equity financing, and the sale of a portion of its property and equipment assets.

For the third quarter, the company reported a net loss of C$8.7 million, or 30 Canadian cents a share, compared with net income of C$12.0 million, or 41 Canadian cents a share, a year ago.

Total sales fell 46 percent to C$9.0 million, hurt mainly by lower commodity prices.

Shares of the company closed at 49 Canadian cents Thursday on the Toronto Stock Exchange. (Reporting by Amit Kumar in Bangalore; Editing by Anne Pallivathuckal)

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