HOUSTON, TX ("the Company") announces today the financial
results of operations for the year ended December 31, 2007.
For the twelve months ended December 31, 2007
-- Revenue from oil and gas sales increased to $6,920,533 for 2007 as
compared to $151,416 for 2006.
-- Cash flow from operations of $853,615 which represents an increase of
$1,608,424 from the same period in 2006.
-- Proved reserves of 2,716,602 barrels of oil equivalent (boe), net of
production, up from 27,249 boe at year end 2006.
-- Proved reserves consist of 90.6% crude oil and 9.4% natural gas.
-- The present value of the proved reserves discounted at 10% is in
excess of $54 million.
-- Shareholders equity grew to $39,724,419 as compared to $10,698,758
for 2006.
Partial financial tables are found at the end of this press
release. Please refer to the Company's Annual Report on Form 10-K
for the year ended December 31, 2007 which was filed on March 31,
2008 for complete financials and accompanying notes.
Management Comments
Mr. Wayne Hall, Chief Executive Officer of Petro Resources,
said: "I am very pleased with the operational success the Company
achieved in 2007." Mr. Hall continued, "The significant increase in
proved reserves, production and revenue are primarily the result of
our acquisition and enhanced oil recovery operations in the
Williston Basin along with exploratory drilling success in both the
Williston Basin in North Dakota and the Cinco Terry Field in Texas.
Our 2007 results provide a meaningful benchmark that should make it
easier for investors to value the Company."
About Petro Resources
Petro Resources Corporation is an independent exploration and
production company engaged in the acquisition of properties and
leases, exploration, development, exploitation, and production of
oil and natural gas in the continental United States.
Forward-looking Statements
The statements contained in this press release that are not
historical are "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), including statements,
without limitation, regarding the Company's expectations, beliefs,
intentions or strategies regarding the future. Such forward-looking
statements relate to, among other things: (1) the Company's
proposed exploration and drilling operations on its various
properties, (2) the expected production and revenue from its
various properties, and (3) estimates regarding the reserve
potential of its various properties. These statements are qualified
by important factors that could cause the Company's actual results
to differ materially from those reflected by the forward-looking
statements. Such factors include but are not limited to: (1) the
Company's ability to finance the continued exploration and drilling
operations on its various properties, (2) positive confirmation of
the reserves, production and operating expenses associated with its
various properties; and (3) the general risks associated with oil
and gas exploration and development, including those risks and
factors described from time to time in the Company's reports and
registration statements filed with the Securities and Exchange
Commission, including but not limited to the Company's Annual
Report on Form 10-K for the year ended December 31, 2007 filed with
the SEC on March 31, 2008. The Company cautions readers not to
place undue reliance on any forward-looking statements. The Company
does not undertake, and specifically disclaims any obligation, to
update or revise such statements to reflect new circumstances or
unanticipated events as they occur.
PETRO RESOURCES CORPORATION
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
2007 2006
Assets
Current assets
Cash and cash equivalents $ 15,399,547 $ 4,285,204
Accounts receivable 924,607 91,344
Prepaids 25,519 11,602
Deferred financing costs, net of amortization of
$1,513,586 2,378,492 -
Total current assets 18,728,165 4,388,150
Property and equipment
Oil and natural gas properties, successful
efforts accounting
Unproved 24,676,434 3,728,112
Proved properties, net 18,936,428 527,958
Furniture and fixtures, net 118,354 -
Total property and equipment 43,731,216 4,256,070
Other assets
Investment in partnership 3,892,944 2,293,104
Deposit 10,257 10,257
Total other assets 3,903,201 2,303,361
Total Assets $ 66,362,582 $ 10,947,581
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable $ 1,525,474 $ 216,870
Accrued liabilities 210,351 1,300
Stock payable 34,068 -
Short-term debt, net of discount of $2,956,206 11,344,136 -
Total current liabilities 13,114,029 218,170
Market value of derivatives 1,832,316 -
Asset retirement obligation 1,434,114 30,653
Total liabilities 16,380,459 248,823
Minority interest 3,025,375 -
Redeemable Preferred Stock
Series A Convertible Preferred Stock, $3 stated
value, issued 2,410,776 shares; cumulative,
dividend rate 10% per annum with liquidation
preferences 7,232,329 -
Shareholders' equity
Preferred stock, $0.01 par value; 10,000,000
shares authorized, 2,410,776 shares of Series A
Preferred Stock issued and outstanding as of
December 31, 2007 (reported above) - -
Common stock, $0.01 par value; 100,000,000 shares
authorized, 36,599,372 and 19,677,317 shares
issued and outstanding as of December 31, 2007
and December 31, 2006 respectively 365,994 196,773
Additional paid in capital 49,723,515 14,816,718
Accumulated deficit (10,365,090)
(4,314,733)
Total shareholders' equity 39,724,419 10,698,758
Total Liabilities and Shareholders' Equity $ 66,362,582 $ 10,947,581
PETRO RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Common Stock Additional Total
Number Paid-in Accumulated Shareholders'
of Shares Total Capital Deficit Equity
Balance,
December 31,
2005 16,191,317 161,913 5,038,037 (415,748) 4,784,202
Shares and
warrants sold
in private
placement,
net 3,486,000 34,860 8,180,140 - 8,215,000
Stock options
issued to the
board of
directors 1,598,541 1,598,541
Net loss for
the year
ended
December 31,
2006 - - - (3,898,985) (3,898,985)
Balance,
December 31,
2006 19,677,317 $ 196,773 $ 14,816,718 $(4,314,733) $10,698,758
Exchange of
preferred
stock for
common
stockand (1,573,800) (15,738) (4,705,663) - (4,721,401)
warrants
Legal expense
on preferred
stock - - (14,705) - (14,705)
Preferred
stock
dividend - - - (510,928) (510,928)
Restricted
stock issued
to Chief
Financial
Officer 25,000 250 62,750 - 63,000
Shares issued
for purchase
of property 3,144,655 31,447 10,691,827 - 10,723,274
Stock options
issued for
consulting
services - - 58,000 - 58,000
Stock options
to board of
directors - - 913,701 - 913,701
Stock options
to Chief
Financial
Officer - - 83,135 - 83,135
Stock issued
for cash 15,326,200 153,262 28,353,470 - 28,506,732
Offering costs
to issue
stock - - (535,718) - (535,718)
Net loss for
the year
ended
December 31,
2007 - - - (5,539,429) (5,539,429)
Balance,
December 31,
2007 36,599,372 365,994 49,723,515 (10,365,090) 39,724,419
PETRO RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended
December 31
2007 2006
Revenue
Oil and gas sales $ 6,920,533 $ 151,416
Other income 100,000 -
Gain (loss) on sale of property - 1,394,754
7,020,533 1,546,170
Expenses
Lease operating expenses 3,510,521 55,172
Exploration 1,767,898 2,150,729
Impairment of oil & gas properties 95,272 614,770
Depreciation, depletion and
accretion 1,781,263 304,396
General and administrative 2,751,647 2,602,632
Total expenses 9,906,601 5,727,699
Loss from operations (2,886,068) (4,181,529)
Other income and (expense)
Interest income 171,557 286,564
Interest expense (743,023) (4,020)
Loss on derivative contracts (2,458,165) -
Loss before minority interest (5,915,699) (3,898,985)
Minority interest 376,270 -
Net loss (5,539,429) (3,898,985)
Dividend on Series A Convertible
Preferred (510,928) -
Net loss attibutable to common
stockholders $ (6,050,357) $ (3,898,985)
Earnings per common share
Basic and diluted $ (0.28) $ (0.20)
Weighted average number of common
shares outstanding
Basic and diluted 21,253,995 19,201,991
PETRO RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended
December 31
2007 2006
Cash flows from operating activities
Net loss $ (5,539,429) $ (3,898,985)
Adjustments to reconcile net income to net
cash (used in) provided by operating
activities:
Minority interest (376,270) -
Depletion, depreciation, and accretion 1,781,263 304,396
Amortization included in interest expense 468,938 -
Amortization of insurance expense 125,972 -
Impairment 95,272 614,770
Dry hole costs 1,310,988 2,141,907
Issuance of common stock and stock options
for services 1,117,836 1,598,541
Gain on sale of property - (1,394,754)
Unrealized loss on derivative contracts 1,832,316 -
Changes in operating assets and
liabilities:
Accounts receivable and accrued revenue (833,263) (91,344)
Prepaid expenses - (11,602)
Accounts payable 626,873 77,726
Accrued expenses 243,119 (95,464)
Net cash provided by (used in) operating
activities 853,615 (754,809)
Cash flows from investing activities
Capital expenditures (14,266,262) (8,240,421)
Acquisition of Williston Basin (14,097,855) -
Deposits - (10,257)
Investment in partnership (1,599,840) (2,293,104)
Proceeds from sale of properties - 3,953,785
Net cash used in investing activities (29,963,957) (6,589,997)
Cash flows from financing activities
Proceeds from sale of common stock, net 27,971,014 8,215,000
Repayment of officer advances - (2,500)
Issuance of preferred stock 2,000,000 -
Costs to issue preferred stock (14,705) -
Financing costs (3,892,078) -
Proceeds from loan 28,534,442 -
Principal payment on loan (14,373,988) -
Net cash provided by financing activities 40,224,685 8,212,500
Net increase (decrease) in cash 11,114,343 867,694
Cash, beginning of period 4,285,204 3,417,510
Cash, end of period $ 15,399,547 $ 4,285,204
Supplemental disclosure of cash flow
information
Cash paid for interest $ 1,944,388 $ 4,020
Cash paid for federal income taxes - -
Non-cash transactions
Common stock issued in acquisition of
Williston Basin properties 10,723,274 -
Royalty and minority interest issued in
connection with debt 4,837,429 -
Preferred stock dividend paid in preferred
shares 510,928 -
Cancellation of common stock in exchange
for preferred stock 4,721,401 -
Capitalized interest in oil and gas
properties 1,675,802 -
Property and equipment included in
accounts payable $ 681,731 $ -
Contact: Brad Holmes Investor Relations (713) 654-4009 or Don
Kirkendall, President (832) 369-6986
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