Pearl Exploration and Production Ltd.



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  Jan 30, 2007 - 08:00 ET
Pearl Announces 2006 Year-End Financial Results

  CALGARY, ALBERTA--(CCNMatthews - Jan. 30, 2007) - Pearl Exploration and Production Ltd. ("Pearl" or the "Company") (TSX VENTURE:PXX) is pleased to announce the release of its financial results for the year ended September 30, 2006. The audited financial statements, notes and MD&A are filed on SEDAR and are available on Pearl's website.

The key accomplishments of Pearl since the Company's last annual report include:

- Acquiring Pan-Global Energy Ltd. on April 28, 2006 which added significant heavy oil development potential at Onion Lake.

- Resolving an ongoing land dispute on October 20, 2006 with the Onion Lake First Nation which will allow Pearl to proceed with development at Onion Lake.

- Acquiring Nevarro Energy Ltd., a junior oil and gas company, on September 19, 2006 which added further heavy oil assets and undeveloped land which complement the Onion Lake assets.

- Completing a three-well appraisal drilling program of the Topanga oil field in California. All three wells have been cased for oil and gas potential.

- Acquiring additional lands and commencing steam injection at the San Miguel heavy oil project.

- Participating in the drilling of three exploratory gas wells at Palo Duro, Texas. The drilling has provided encouraging preliminary results that suggest economic initial production capacity from the Lower Pennsylvania shale gas play. Although initial testing is not yet conclusive regarding long term development economics (e.g., ultimate well recovery, condensate recovery efficiency), Pearl and its partners are sufficiently encouraged to continue assessing the viability of the play.

- Acquiring Atlas Energy Ltd., a junior oil and gas company, on December 22, 2006 which added significant heavy oil assets and undeveloped land in western Canada.

- Raising more than $69 million through two equity financings and the exercise of warrants. Subsequent to the September 30, 2006 year-end and concurrent with the Atlas acquisition, Pearl raised an additional $111 million through an equity financing.

The Company has made a strategic decision to divest its shallow water gas exploration activities in the Gulf of Mexico ("GOM") by transferring its interests to a U.S. public company through an equity ownership. This will allow Pearl to continue to participate in the upside of the high potential of exploration in the GOM, but relieves the Company of any associated budget obligations.

Following the Atlas and other acquisitions, the Company has transitioned into a junior oil and gas company with current production of approximately 8,000 boe/d. Pearl plans a capital program of $145 million in 2007. Currently the Company plans to drill 230 wells and is forecasting gross production exit rates for 2007 of 12,000 to 14,500 boe/d.

The table below provides a summary of Pearl's financial operating results for the years ended September 30, 2006 and 2005:



Year ended September 30 2006 2005
----------- -----------

FINANCIAL ($000's except per share data)

Total revenue 3,799 9
Cash flow from operations (962) (183)
Per common share
Basic ($) (0.03) (0.02)
Diluted ($) (0.03) (0.02)
Net earnings (loss) (8,953) 365
Per common share
Basic ($) (0.23) 0.02
Diluted ($) (0.23) 0.02
Total assets 129,067 3,191
Total long-term financial liabilities 9,296 -
Working capital (3,757) 2,886
Shareholders' equity 102,091 2,986
Weighted average shares outstanding
(basic and diluted - 000's) 38,649 15,348
Common Shares outstanding (000s) 51,913 23,745

OPERATIONS

Daily production - net
Oil (bopd) 928 -
Natural gas (mcf/d) 1,639 -
Total (boe/d) 1,201 -
Average selling prices
Oil ($/bbls) 50.21 -
Gas ($/mcf) 5.97 -
Operating costs 847 -

 


Pearl is a public company focused on delivering disciplined growth by establishing a North American portfolio of oil and gas projects with an emphasis on large resource opportunities. Additional information on Pearl is available on our website at www.pearleandp.com.

All references in this release to boe's are based on a 6 to 1 conversion ratio. Boe's may be misleading, particularly if used in isolation. A boe conversion of 6 Mcf:1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Forward-looking statements: This document contains statements about expected or anticipated future events and financial results that are forward-looking in nature and as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events, and the Company's capability to execute and implement its future plans. Actual results may differ materially from those projected by management. For such statements, we claim the safe harbour for forward-looking statements within the meaning of the Private Securities Legislation Reform Act of 1995.



The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

FOR FURTHER INFORMATION PLEASE CONTACT:


Pearl Exploration and Production Ltd.
Gary Guidry
President and Chief Executive Officer
(403) 716-4051
(403) 261-1007 (FAX)
Email: gary.guidry@pxx.ca

or

Pearl Exploration and Production Ltd.
Gary Hyde
Chief Operating Officer
(403) 716-4063
(403) 261-1007 (FAX)
Email: gary.hyde@pxx.ca

or

Pearl Exploration and Production Ltd.
Arlene Weatherdon
Chief Financial Officer
(403) 716-4051
(403) 261-1007 (FAX)
Email: arlene.weatherdon@pxx.ca

or

Pearl Exploration and Production Ltd.
Sophia Shane
Corporate Development
(604) 806-3575
Email: sophias@namdo.com
Website: www.pearleandp.com
 
 

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