Petrol Oil and Gas Announces First Quarter Results
Monday May 22, 7:00 am ET
Investments in Operations and Infrastructure Expected to Expand Production Throughout 2006
OVERLAND PARK, Kan.--(BUSINESS WIRE)--May 22, 2006--Petrol Oil and Gas, Inc., (OTCBB:POIG - News) with mineral rights to approximately 165,000 gross acres in Eastern Kansas and Western Missouri, announced today results for the quarter ended March 31, 2006. Petrol had revenue of $1,216,025 compared to $1,190,611 in the fiscal 2005 first quarter. Petrol had a net operating loss of $1,118,875 compared to the year earlier period when it had a net operating loss of $1,289,542. The fiscal 2006 net operating loss included non-cash depreciation, depletion and amortization expenses of $464,649, compared to $349,454 in the fiscal 2005 first quarter. The 2006 first quarter loss also included $154,010 in pipeline costs that Petrol did not incur in the first quarter of fiscal 2005.
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Petrol reported a 2006 first quarter net loss of $1,809,195 or $0.06 per share, compared to a net loss of $1,671,704 or $0.08 per share in the first quarter of 2005. The fiscal 2006 results included $692,114 in interest expenses, compared to similar expense of $395,815 in the year-earlier period. Higher interest expense was a result of higher levels of indebtedness to support Petrol's drilling activities.
"During the first quarter, we focused on field development of our Coal Creek Project areas and thus made significant investments in staffing our field operations, de-water many of our new wells in the Burlington and Waverly areas and connecting our gas compressors and gas processing systems into a regional interstate pipeline owned by Enbridge, which we successfully completed in early May," said Paul Branagan, President and CEO of Petrol. "We believe these investments will yield demonstrable results in the second quarter and throughout the balance of the year, as it expands gas sales from new production wells in the Burlington and Waverly areas that will supplement our existing Neodesha area production. In addition, the $5 million tranche of debt funding we recently secured allows our field operations to continue the aggressive development program Petrol initiated last November on our Coal Creek Project, which will allow us to accelerate drilling activities and the completion of additional production wells. We believe that as we expand production from the Burlington and Waverly areas that we will be well positioned to increase production revenues throughout the year."
The Coal Creek development plan is based upon drilling and completing some 540 wells over a two to three year period, along with miles of gas gathering pipelines and infrastructure to process, transport and sell gas in mid-west markets. To better manage the development of the 92,000 gross acres in this project and take advantage of the three interstate pipelines crossing Petrol's leases, Petrol divided the project into three fully self contained areas; Burlington, Waverly and Lebo.
Petrol holds a 100% working interest (WI) and an average 80% Net Revenue Interest (NRI) in the entire Coal Creek Project, covering coal bed methane (CBM) and other oil and gas reserves located in eastern Kansas and western Missouri.
The Company will hold a conference call today at 9:00 a.m. eastern time to discuss the results and outlook for 2006. Interested participants should call (877) 803-5726 for domestic access or (706) 679-6112 for international access. Please reference Conference I.D. Number 9690547. There will also be a replay available for 30 days following the date of the call. To access the replay, please dial (800) 642-1687 for domestic callers or (706) 645-9291 for international callers.
This call is being webcast and can be accessed through Petrol Oil and Gas's web site at www.petroloilandgas.com until June 22, 2006.
In addition, as of January 1, 2006 Petrol emerged from the filing designation as a Small Business and the first quarter of 2006 was Petrol's first filing quarter as a non-SB filer. A copy of Petrol's first quarter Form 10-Q is available on the SEC's website (www.sec.gov).
Forward-Looking Statement: The statements in this press release regarding Petrol's first quarter operating results, the actual number of Petrol's leased acreage, Petrol's ability to expand its production, actual and anticipated market conditions, actual number of wells to be drilled in the Coal Creek Project, the actual number of leased acres in the Coal Creek Project, Petrol's actual NRI, any implied or perceived benefits from Petrol's CBM assets, and any other effects resulting from any of the above are forward-looking statements. Such statements involve risks and uncertainties, including, but not limited to, the continued production of gas at historical rates, total funds available to Petrol under its current debt facility, costs of operations, delays, and any other difficulties related to producing minerals such as oil or gas, continued maintenance of the oil field and properties, price of oil or gas, marketing and sales of produced minerals, risks and effects of legal and administrative proceedings and governmental regulation, future financial and operational results, competition, general economic conditions, and the ability to manage and continue growth.
Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Important factors that could cause actual results to differ materially from the forward-looking statements Petrol makes in this news release include market conditions and those set forth in reports or documents Petrol files from time to time with the SEC. Petrol undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Contact:
Petrol Oil and Gas, Inc.
Investor Information, 702-454-7318
www.petroloilandgas.com
or
CEOcast, Inc. for Petrol Oil and Gas
Ed Lewis, 212-732-4300, Ext. 225
