TGC Tengasco Inc New

Tengasco, Inc. (AMEX: TGC) announced today its financial results for the quarter ended September 30, 2008. The Company�s revenues during the third quarter of 2008 were $5.1 million, as compared to $2.4 million in the third quarter of 2007, an increase of 113%. The Company's operating income was $2.4 million in the third quarter 2008 compared to operating income in third quarter 2007 of $0.5 million. These substantial increases in operating results were due to a 9,377 net barrel increase in the Company�s oil sales and an increase in oil prices in the 2008 period. Oil prices in the third quarter of 2008 averaged $110.85 per barrel compared to $69.15 per barrel in the third quarter of 2007. Although the Company�s revenues and operating income increased substantially, the Company�s net income remained relatively flat period over period. Net income during the third quarters of 2007 and 2008 were $1.5 million or $0.03 per share of common stock. Net income remained flat because the Company recorded non-cash operating loss carry forwards of $1.1 million in the third quarter of 2007, which increased its net income, while it recorded a non-cash income tax expense of $0.8 million for the third quarter of 2008, which correspondingly decreased its net income. The Company recognized $13.0 million in revenues during the first nine months of 2008 compared to $6.4 million in the first nine months of 2007, an increase of 104%. Oil prices in the first nine months of 2008 averaged $106.53 per barrel compared to $60.28 per barrel in the first nine months of 2007. The Company's operating income for the first nine months of 2008 was $5.4 million compared to operating income in the same period in 2007 of $0.6 million. These increases in operating results were due to a 12,742 net barrel increase in the Company�s oil sales and an increase in oil prices period over period. The Company realized net income of $8.8 million or $0.15 per share of common stock during the first nine months of 2008, compared to net income in the first nine months of 2007 of $1.7 million or $0.03 per share of common stock. Net income increased primarily as a result of operating results, but also from the recordation of the Company� remaining net operating loss carry forwards of $5.2 million in the first quarter of 2008, the effects of which were offset in part by a non-cash income tax expense of $1.8 million incurred in the first nine months of 2008. Jeffrey R. Bailey, Chief Executive Officer of the Company, said, �We have again set a new Company production record in the third quarter 2008, producing more than 63,700 gross barrels. Third quarter 2008 results include for the first time the addition of the Riffe Field properties purchased from Black Diamond Oil effective with July 2008 production. We believe the Company is well positioned to continue to expand production volumes by additional Kansas drilling. This 12% increase in production is due to a 10% increase on properties owned before the addition of the Riffe field, generated from drilling and polymer work-overs. The three months of production from the newly acquired Riffe Field contributed 2% to the 9 month total.� Mr. Bailey added: �Although limited by weather and rig availability, the Company drilled four new wells in the third quarter. Other planned drilling locations intended to be commenced in the third quarter are now expected to be drilled in the fourth quarter. The first of the four wells drilled in the third quarter was the Albers #1 wildcat discovery well drilled in early July. It started producing on July 29, 2008 and has produced 4,000 barrels through November 1, a 42 barrel per day average. The second well was the McClure wildcat well drilled in Rooks County, which was a dry hole. The third well was the Verveka C #1 water disposal well drilled to handle the water being produced in our ongoing drilling program targeting the Verveka lease. The Verveka lease area contains many potential future locations and we view establishing water management as critical to future development. (For example, an offset well, the Verveka B #1 drilled earlier this year, has produced 1,375 barrels and needs access to a water disposal location. However, after the Company treated it with polymers, the Verveka B #1 has seen decreased water production, and in the first four days of production after the polymer treatment has produced more than 450 barrels of oil.) The fourth well was the Zerger #1 well, another offset to the Verveka Lease. Production of this well is being held up pending final clearance to use the Verveka C #1 disposal well. The Company has more than 15 potential future locations in this area of focus that will be the target of a significant portion of the near future drilling sites. In addition to the four wells drilled in the third quarter, the Company returned to Trego County in October to drill the Albers A #1 well as an offset to the original Albers well. The new Albers well has tested as productive and will be completed soon.� Mr. Bailey further commented: �Our Riffe field production, purchased in July 2008, has yielded immediate benefits to our production levels. We purchased these properties when they were producing about 80 barrels per day. We have performed two polymer treatments on the existing Riffe field wells, and are completing a third one. As a result, current production from the Riffe field properties increased to an average of approximately 135 barrels per day for October, and at the time of this release the Riffe field was producing over 185 barrels per day on the strength of another polymer application. This elevated our gross oil production rate during the first week of November to above 800 barrels per day. We will attempt to further increase production from these properties with additional polymer treatments. Similar polymer treatments are playing a role in our developmental drilling program. The area surrounding our Verveka lease appears to be responding very favorably to these treatments after initial production. Depending on energy prices going forward, we intend to continue to mix exploration drilling and development drilling for some time.� Mr. Bailey continued: �We continue to work toward completion of the Company�s methane extraction process at the Carter Valley landfill in Hawkins County, Tennessee. As of November 1, 2008, we have completed the plant equipment installation and the three mile gas pipeline connection to our existing line. We are now in initial testing and calibration for startup and expect that commercial deliveries of methane through our pipeline to Eastman Chemical Company could begin in early December 2008. These gas volumes will supplement our gas production from the Swan Creek field.� Forward-looking statements made in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements involve risk and uncertainties which may cause actual results to differ from anticipated results, including risks associated with the timing and development of the Company's reserves and projects as well as risks of downturns in economic conditions generally, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.