Canadian Oil

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Tango Energy loses $216,000 in Q1 2007

2007-05-25 15:06 MT - News Release

Mr. John Gunn reports

TANGO REPORTS FIRST QUARTER 2007 FINANCIAL AND OPERATING RESULTS

Tango Energy Inc. is releasing its unaudited interim financial and operating results for the three months ended March 31, 2007.

 
      
                     FINANCIAL AND OPERATING RESULTS 
          (in thousands of dollars, except per share amounts)  
  
                                                      Three months ended 
                                                                March 31, 
                                                         2007       2006 
  
 Gross revenues                                       $ 2,904    $ 1,260 
 Income (loss) before taxes                              (342)        28 
 Net income (loss)                                       (216)         7 
 Per share -- basic                                     $0.00      $0.00 
 Per share -- diluted                                   $0.00      $0.00 
 Funds flow from operations                             1,354        703 
 Per share -- basic                                     $0.03      $0.02 
 Per share -- diluted                                   $0.03      $0.02 
 Additions to property and 
 equipment, net of proceeds                             4,146      4,668 
 Total assets                                          43,397     33,838 
 Working capital (deficiency)                          (8,463)     3,269 
 Asset retirement obligation                              603        517 
 Flow-through share obligations                         1,300      3,300 
 Sales volumes (average) 
 Natural gas (mcf/d)                                    3,805      1,404 
 Crude oil and liquids (bbl/d)                             32         21 
 Average boe/d                                            666        255 
 Product prices (average) 
 Natural gas ($/mcf)                                     7.92       8.42 
 Crude oil and liquids ($/bbl)                          58.80      63.17 
 Netback analysis ($/boe) 
 Oil and gas revenue                                    48.04      51.53 
 Royalty expense                                        13.97      10.85 
 Operating costs                                         7.69       7.11 
 Netback                                                26.38      33.57 
 

Production averaged 666 barrels of oil equivalent per day (boepd) during the three months ended March 31, 2007, a 161-per-cent increase over the 255 boepd over the three months ended March 31, 2006. Production for the three months ended Dec. 31, 2006, was 369 boepd. Volumes for the month of March, 2007, averaged 874 boepd.

During the three months ended March 31, 2007, two new wells were placed on production, one at Hanlan and one at Ricinus. One well at Quaich was completed and tested.

At Hanlan, the 14-35 well was placed on production during February, 2007, and is currently producing about 9.7 million cubic feet per day of raw gas. Tango has a 28-per-cent working interest in this well, subject to a 12.5-per-cent non-convertible overriding royalty.

At Ricinus, the 6-9 well has been placed on production during March, 2007, and is currently producing 500,000 cubic feet per day of raw gas. Tango has a 67.5-per-cent working interest in this well. Tango acquired six sections at the March 7 land sale at an average 67.5-per-cent working interest.

At Kakwa, the 13-1 Swan Hills well has been drilled and completed. Testing operations were not completed due to wildlife constraints which required all of the equipment to be removed from the lease prior to March 15. As a result, the well has been suspended pending further evaluation of the pressure data. Further operations on the well will not be conducted prior to December, 2007. Tango has a 30-per-cent working interest in this well.

At Quaich, the 3-3 well was tested and evaluated, and it is expected that the well will be tied into existing facilities once a pipeline can be constructed.

Tango has 27,520 gross (16,150 net) acres of undeveloped land located west of the fifth and sixth meridian within the foothills and Deep basin portion of the Western Canadian sedimentary basin. Tango continues to post and acquire Crown land on new plays, as well as Crown land offsetting existing opportunities.

For a copy of Tango's Dec. 31, 2006, financial statements and management discussion and analysis please visit the SEDAR website.