AOG Aurora Oil & Gas Corp.

TRAVERSE CITY, Mich., May 14 /PRNewswire-FirstCall/ -- Aurora Oil & Gas Corporation (AMEX:AOG) today reported revenues of $6.3 million for the quarter ended March 31, 2007, representing a 12% increase from the same period in 2006. Oil and natural gas production revenues topped $5.9 million on production of 732 million cubic feet of natural gas equivalent (mmcfe) for the quarter. This equates to an average of 8.1 mmcfe per day, an increase of approximately 10% over the fourth quarter average from 2006. The weighted average sales price of $8.10 for the period includes $0.8 million in realized gains on financial hedges which cover 5,000 mmbtu per day during the first quarter of this year. Expenses totaled $7 million, a 7% increase from the first quarter of 2006. This increase was largely driven by general and administrative expense, which increased from $1.6 million in 2006 to $2.3 million in 2007, primarily the result of non-cash stock-based compensation expense of $0.6 million. Interest expense decreased from $1.6 million in the first quarter of 2006 to under $1 million for the first quarter of 2007, a result of the Company's change in estimating capitalized interest and a reduction in borrowing under the senior secured credit facility. The net loss for the first quarter of 2007 was $0.7 million or ($0.01) per basic and diluted share, as compared to a loss of $0.9 million, or ($0.01) per basic and diluted share during the same period in 2006. For the first quarter of 2007, the Company participated in the development of 35 gross (15.75 net) wells, 11 gross (10.92 net) wells of which were operated by the Company. As expected, Antrim Shale drilling activities in Michigan were reduced during the first four months of this year due to frost laws instituted by many of the local counties in Northern Michigan. The Company remains on target for the majority of its Antrim Shale drilling efforts to be completed in the second half of 2007. Aurora's New Albany Shale drilling activities are on schedule to increase during the second and third quarters of this year. The Company continues to execute its strategy of drilling in at least three of the four identified key operated areas within its 450,000 net acres that cover southwestern Indiana and western Kentucky. The following summary table shows the existing inventory of wells in which Aurora Oil & Gas has participated: Well Status Antrim New Albany as of Antrim Non- New Albany Non- March 31, Operated Operated Operated Operated 2007 Gross Net Gross Net Gross Net Gross Net Producing 176 166.77 264 52.39 0 0.00 17 0.85 Waiting on Hook-Up 33 32.36 45 9.43 12 6.21 9 0.70 Total 209 199.13 309 61.82 12 6.21 26 1.55 Well Status as of March 31, Other Total 2007 Gross Net Gross Net Producing 26 11.90 483 231.91 Waiting on Hook-Up 7 5.38 106 54.08 Total 33 17.28 589 285.99 Production increased from the fourth quarter of 2006, averaging 8.1 mmcfe per day during the first quarter of 2007. The Company continued to stabilize its daily production with infrastructure enhancements, which has improved the run-time for its Antrim Shale properties. Volumetric growth is expected to continue as the wells dewater, enhancements are installed, and frost laws are lifted, allowing access to surface operations for system maintenance, workovers, water disposal wells or additional drilling efforts. A summary of production for the fourth quarter of 2006 and first quarter of 2007 is provided below: Estimated Production by Q1 2007 Q4 2006 Formation (net mcfe) Total Daily Average Total Daily Average Antrim Shale 675,353 7,504 619,872 6,738 New Albany Shale 10,344 115 11,994 130 Other 46,733 521 39,731 432 Total 732,430 8,140 671,597 7,300 Estimated Production by Q1 2007 Q4 2006 Operator (net mcfe) Total Daily Average Total Daily Average Operated 531,799 5,909 486,785 5,291 Non-operated 200,631 2,231 184,812 2,009 Total 732,430 8,140 671,597 7,300 William W. Deneau, President and CEO, commented, "We are pleased with the direction of the Company. Production volatility has stabilized and volumes are growing and the New Albany Shale is being drilled at an accelerated pace. I am excited to see the execution of our strategy and look forward to seeing the impact of our continued improvements." The Company will be discussing first quarter results in a conference call scheduled for May 14, 2007 at 4 p.m. Eastern Time. Please see below "Conference Call Details" for call-in and webcast participation information. Additional detail on the financial and operational results can be found in the Company's Form 10-Q filed May 14, 2007. This form can be retrieved from the Securities and Exchange Commission or via the Company website at http://www.auroraogc.com/SEC_Filings.htm. Selected historical financial data is provided for reference below. Conference Call Details Call-In Information Aurora Oil & Gas invites interested persons to participate in the call by dialing 866-344-4934 (toll-free, domestic) or 416-849-4293 (international) prior to 3:55 p.m. Eastern Time. A digital replay of the conference call will be available within three hours following the call and will remain available until 11:59 p.m. Eastern Time on May 21, 2007. The replay can be dialed at 866-245-6755 (toll-free, domestic) or 416-915-1035 (international) and reference should be made to account number 286 and conference ID number 23800. Webcast Information The call will also be broadcast live via Internet webcast at http://www.vcall.com/IC/CEPage.asp?ID=116961. This link may also be accessed on the Company's website, http://www.auroraogc.com/, through the "Investor Relations" page and the "Presentations & Webcasts" link. An archived webcast and podcast will be available for listening or download within three hours after the call and can be found under the links suggested above for up to 6 months following the event. Selected Financial Data The following table sets forth our selected financial data as of and for each of the periods indicated. The data as of December 31, 2006, is derived from our audited consolidated financial statements for the period indicated. The data as of and for the three months ended March 31, 2007 and 2006, is derived from our unaudited condensed consolidated financial statements for the periods indicated. The interim unaudited information was prepared on a basis consistent with that used in preparing our audited consolidated financial statements and includes all adjustments, consisting only of normal and recurring items, that we consider necessary for a fair presentation of the financial position, results of operations and cash flows for the unaudited periods. Operating results for the three months ended March 31, 2007 are not necessarily indicative of results that may be expected for the entire year 2007 or any future periods. You should review this information together with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and unaudited condensed consolidated financial statements and related notes included in our Form 10-Q for the three months ended March 31, 2007. Three Months Ended March 31, 2007 2006 Statement of Operating Data Revenues: Oil and natural gas sales $ 5,929,576 $ 5,416,866 Pipeline transportation and marketing 129,268 111,766 Field service and sales 189,518 - Interest and other 13,513 55,364 Total revenues 6,261,875 5,583,996 Expenses: Production taxes 263,098 214,159 Production and lease operating expense 1,925,893 1,658,726 Pipeline operating expense 113,420 65,281 Field services expense 154,272 - General and administrative expense 2,260,343 1,566,694 Oil and natural gas depletion and amortization 746,865 941,965 Other assets depreciation and amortization 568,606 467,752 Interest expense 981,532 1,594,135 Taxes, other (25,182) 1,667 Total expenses 6,988,847 6,510,379 Loss before minority interest (726,972) (926,383) Minority interest in (income) loss of subsidiaries (13,347) (12,800) Net loss $ (740,319) $ (939,183) Net loss per common share - basic and diluted $ (0.01) $ (0.01) Weighted average common shares outstanding - basic and diluted 101,552,888 70,265,281 Cash Flow Data Cash provided by (used in) operating activities $ 2,528,272 $ (1,436,760) Cash used by investing activities (19,519,447) (42,715,087) Cash provided by financing activities 17,405,545 49,344,193 As of As of March 31, 2007 December 31, 2006 (Unaudited) (Audited) Balance Sheet Data Cash and cash equivalents $ 2,149,766 $ 1,735,396 Other current assets 8,632,034 12,728,588 Oil and natural gas properties, net (using full cost accounting) 172,411,226 161,294,155 Other property and equipment, net 9,185,555 9,221,228 Other assets 25,821,989 27,407,825 Total assets $ 218,200,570 $ 212,387,192 Current liabilities $ 10,294,551 $ 18,040,082 Long-term debt, net of current maturities 71,927,829 54,538,138 Minority interest in net assets of subsidiaries 91,220 77,873 Shareholders' equity 135,886,970 139,731,099 Total liabilities and shareholders' equity $ 218,200,570 $ 212,387,192 About Aurora Oil & Gas Corporation Aurora Oil & Gas Corporation is an independent energy company focused on unconventional natural gas exploration, acquisition, development and production with its main operations in the Michigan Antrim Shale and New Albany Shale of Indiana and Kentucky. Cautionary Note on Forward-Looking Statements Statements regarding future events, occurrences, circumstances, activities, performance, outcomes and results, including plans for future growth through drilling and production are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although we believe that the forward- looking statements described are based on reasonable assumptions, we can give no assurance that they will prove accurate. Important factors that could cause our actual results to differ materially from those included in the forward- looking statements include the timing and extent of changes in commodity prices for oil and gas, drilling and operating risks, the availability of drilling rigs, changes in laws or government regulations, unforeseen engineering and mechanical or technological difficulties in drilling the wells, operating hazards, weather-related delays, the loss of existing credit facilities, availability of capital, and other risks more fully described in our filings with the Securities and Exchange Commission. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise. DATASOURCE: Aurora Oil & Gas Corporation CONTACT: Jeffrey W. Deneau, Investor Relations of Aurora Oil & Gas Corporation, +1-231-941-0073 Web site: http://www.auroraogc.com/ http://www.auroraogc.com/SEC_Filings.htm http://www.vcall.com/IC/CEPage.asp?ID=116961

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