Biloxi Marsh Lands Corporation (PINK SHEETS: BLMC) today
announces its unaudited results for the second quarter and first
six months of 2010 and provides update. Total revenue for the
second quarter of 2010 was $414,029 compared to total revenue of
$263,537 for the same period of 2009. For the first six months of
2010 revenue was $859,715 compared to $1,258,659 for the same
period of 2009. For the second quarter total revenue includes a
gain of $29,182 emanating from partnership income which represents
the Company’s investment in B&L Exploration, LLC (B&L).
This compares to net loss $42,057 in the same category during the
second quarter of 2009. The gain emanating from the Company’s
investment in B&L is directly related to wells being placed on
production during the first half of this year that were
successfully drilled during Q3 and Q4 of 2009. Meanwhile, for the
first six months of 2010 partnership income was $26,565 compared to
income of $367,514 in the same category for the first six months of
2009. This reduction in partnership income for the first six months
of 2010 was mainly due to expenses related to completing and
building infrastructure for the wells successfully drilled during
Q3 and Q4 of 2009. During the second quarter of 2010, oil and gas
revenues were $333,036 compared to $238,373 for the same period of
2009. For the second quarter of 2010, we incurred a loss on the
sale of investment securities of $39,737 compared to a loss of
$13,595 during the second quarter of 2009. Meanwhile, operating
expenses for the second quarter of 2010 were $268,201 compared to
operating expenses of $464,458 for the same period of 2009. The
lower expenses were due to reduced legal fees and expenses leading
to our quarterly net gain of $102,080 or $.04 per share for the
second quarter of 2010 compared to a loss of $76,485 or $.03 per
share for the second quarter of 2009. Meanwhile, our net earnings
for the first half of 2010 were $236,576 or $.09 per share compared
to $417,795 or $.15 per share for the same period of 2009.
We reported in the past that there are multiple disputes raised
in the pending litigation in State Court in St. Bernard Parish with
the State of Louisiana regarding the State’s claims to certain
waterbottoms owned by the Company. There is approximately $15mm
deposited in the various concursus accounts established to hold the
funds relating to these disputes between the Company and the State
of Louisiana.
We are pleased to announce, that preliminary approval for
settlement of all cases involving disputed waterbottoms between the
Company and the State of Louisiana was granted by the Mineral and
Energy Board of the State of Louisiana during its meeting held on
July 14, 2010. The settlement will involve sharing the funds with
the State of Louisiana deposited in the various concursus accounts
on a proportional basis which has been negotiated between
representatives of the State and the Company. While we have an
agreement in principle, full and final settlement is pending
negotiation, drafting and approval of written settlement agreements
by the State of Louisiana’s Mineral and Energy Board and the Board
of Directors of the Company. When settlement becomes final and
binding upon all of the interested parties an appropriate press
release will be issued by the Company. The Company hopes to have
this matter fully settled and funds distributed prior to the end of
2010. For more information on the disputes between the Company and
the State of Louisiana, please refer to our website
www.biloximarshlandscorp.com.
We are also pleased to announce that The Meridian Resource
Corporation (TMR) has successfully reentered and redrilled the TMR-
Biloxi Marsh Lands 1-2 well. This well was placed on production
during the middle part of July 2010 and is currently flowing at a
rate of approximately 7.5 million cubic feet (mmcf) of natural gas
per day.
As of July 27, 2010 the combined gross daily production rate
from 6 wells operated by the Company’s mineral Lessees was
approximately 14.0 million mmcf of natural gas with net daily
production accruing to the Company of approximately 2.0 mmcf. This
represents a significant increase in production emanating from our
fee based lands. Combining this daily production with the Company’s
proportional share of the daily production from the B&L
Exploration, LLC (B&L) wells makes the total net daily
production accruing to the Company as of July 27, 2010
approximately 4.54 mmcfe (natural gas equivalents) per day.
Through B&L, management continues its strategy to attempt to
increase the Company’s daily oil and gas production and proved
reserves. We previously announced that B&L participated in the
drilling and completion of the Delacroix # 41 ST and the SL 1212 #1
in Plaquemines Parish, Louisiana. BOPCO, L.P. is the Operator of
these wells located within the Pointe A La Hache Field. B&L’s
Class B membership has a 25% working interest in each of these
wells. Both the Delacroix # 41 ST and the SL 1212 #1 well have been
placed on production. During the Q2-2010, B&L participated in
the drilling of the Miami Corp 34-1 well in Cameron Parish,
Louisiana. Walter Oil & Gas Corporation operated the well and
BTA Oil Producers, L.L.C was the other working interest partner.
Unfortunately, while this well encountered oil and gas pay sands in
the targeted intervals, the thickness of the pay sands encountered
did not justify completing of the well, thus it has been plugged
and abandoned. We have been able to fully expense all the costs
related to this well. Additionally, the Lake Eugenie Land &
Development, No. 1 well is being placed on compression to increase
its flow rate. While the compressor barge is on location, Gulf
Production Company, the Operator of this well, is experiencing
delays in completing the hookup. It is anticipated that higher flow
rates will be achieved once the compressor barge is fully hooked up
and operational. This should be completed in the near term. As of
July 27, 2010 the total net daily natural gas production accruing
to B&L was approximately 2.8 mmcf of natural gas and 23 barrels
of oil.
B&L was organized as a limited liability Company (LLC) under
the laws of Louisiana in July of 2006. B&L’s Class A members
are BLMC and Lake Eugenie Land & Development, Inc. (LKEU),
which have membership percentages of 75% and 25% respectively. The
Operating Agreement was amended on November 16, 2009 to create a
Class B membership to allow for certain future projects at the
discretion of the board of managers to be participated by either
Class A or Class B members or a combination of the respective
Classes. B&L’s Class B members are BLMC and LKEU, which have
membership percentages of 90% and 10% respectfully.
In regards to the Deep Water Horizon drilling rig explosion
and resulting BP oil spill.
While certain limited geographic areas of the Company’s property
recently have been contaminated by oil, property damage varies
depending on the specific area, combined with the density and
volume of oil in each contaminated area. We are working closely
with BP, and government officials to minimize the long term impact
and property damage, and we have personnel and independent experts
in the field evaluating each impacted area. Considering the
magnitude of the spill and the proximity of the Deep Water Horizon
rig to our property as of this time overall impact to our entire
property appears to be minimal.
William B. Rudolf, President and CEO, commented: “While we are
very pleased with the significant increase in our production both
from the new producing well on our fee lands and from our
investment in B&L, we are also pleased with the apparent
settlement agreement reached with the State of Louisiana. All these
events should add significantly to this year’s earnings. We are
disappointed with the results of the Miami 34-1 well, but are
working to put together additional prospects to drill during Q3 and
Q4. Meanwhile, the BP oil spill has represented a challenge for us
and our property has been impacted. While the impacted areas are
limited, costs of restoration could be significant. With this said,
considering our property’s proximity to the Deep Water Horizon
drilling rig, the overall impact from the spill appears to be
limited.”
The Company maintains a website; www.biloximarshlandscorp.com
and we strongly recommend that all investors and interested parties
visit the website to view historical press releases, historical
financial statements including President’s Report to Shareholders,
and general information about the Company. Complete and updated
contact information is available on the Company’s website:
www.biloximarshlandscorp.com.
Biloxi Marsh Lands Corporation owns approximately 90,000 acres
of marsh lands located in St. Bernard Parish, Louisiana. As the
landowner, it derives the vast majority of its revenue from oil and
gas exploration and production activities that take place on or
near the Company’s land as well as its proportional share of
revenue generated by B&L Exploration, LLC. The Company also
derives minimal revenues from surface rentals.
This news release contains forward-looking statements regarding
oil and gas discoveries, oil and gas exploration, development and
production activities and reserves. Accuracy of the forward-looking
statements depends on assumptions about events that change over
time and is thus susceptible to periodic change based on actual
experience and new developments. The Company cautions readers that
it assumes no obligation to update or publicly release any
revisions to the forward-looking statements in this report.
Important factors that might cause future results to differ from
these forward-looking statements include: variations in the market
prices of oil and natural gas; drilling results; unanticipated
fluctuations in flow rates of producing wells; oil and natural gas
reserves expectations; the ability to satisfy future cash
obligations and environmental costs; and general exploration and
development risks and hazards. Readers are cautioned not to place
undue reliance on forward-looking statements made by or on behalf
of the Company. Each such statement speaks only as of the day it
was made. The factors described above cannot be controlled by the
Company. When used in this report, the words “believes,”
“estimates,” “plans,” “expects,” “should,” “outlook,” and
“anticipates” and similar expressions as they relate to the Company
or its management are intended to identify forward-looking
statements.
The following “Statements of Assets, Liabilities and
Stockholders’ Equity” and “Statement of Revenues and Expenses and
Retained Earnings” have been derived from an interim un-audited
financial statement which does not include the information and
footnotes that are an integral part of a complete financial
statement.
BILOXI MARSH LANDS
CORPORATION Statements of Assets, Liabilities, and
Stockholders' Equity June 30, 2010 and 2009
Assets
2010 2009 Current assets: Cash and cash
equivalents $ 6,161,600 3,388,576 Accounts receivable 119,329
117,323 Federal income taxes receivable 143,528 255,754 State
income taxes receivable 79,163 69,240 Prepaid expenses 4,625 46,299
Accrued interest receivable 63,158 68,946 Other assets 3,830
8,761 Total current assets 6,575,233 3,954,899
Investment in partnership 2,849,483 1,306,135 Marketable
debt and equity securities - at cost 8,545,492 7,458,776 Land - at
cost 234,939 234,939 Levees and office furniture and equipment
255,430 188,352 Accumulated depreciation (255,430 ) (188,352 )
11,629,914 8,999,850 Total assets $ 18,205,147
12,954,749
Liabilities and Stockholders'
Equity
Current liabilities: Accrued expenses $ 54,545 122,709 Other
current liabilities 3,960 2,520 Total current
liabilities 58,505 125,229 Stockholders' equity:
Common stock, par value $.001 -
20,000,000 shares authorized, 2,851,196 shares issued, outstanding
2,741,428 shares in 2010 and 2,741,428 in 2009
47,520 47,520 Retained earnings 18,282,187 12,965,065
Less cost of treasury stock -
109,768 and 109,768 shares in 2010 and 2009, respectively
(183,065 ) (183,065 ) Total liabilities and stockholders' equity $
18,205,147 12,954,749
BILOXI MARSH LANDS CORPORATION Statements of Revenues
and Expenses and Retained Earnings June 30, 2010 and Comparable
Period
3 Months Ended
6 Months Ended June 30 June 30 2010
2009 2010 2009 Revenues: Oil
and gas Royalties $ 323,302 $ 252,893 $ 656,631 $ 669,306
Severance taxes (20,266 ) (14,520 ) (40,695 )
(46,648 ) Oil and gas royalties, net 303,036 238,373 615,936
622,658 Delay rentals 30,000 -
30,000 - Total oil and gas revenues
333,036 238,373 645,936
622,658
Other: Gain (loss) from
investment in partnership 29,182 (42,057 ) 26,565 367,514 Dividends
and interest 83,916 80,816 161,969 146,026 Gain (loss) on sale of
securities (39,737 ) (13,595 ) 17,613 122,461 Surface rentals and
other 7,632 - 7,632
- Total other income 80,993
25,164 213,779 636,001 Total
revenues and income 414,029 263,537
859,715 1,258,659
Expenses
Total expenses 268,201 464,458
521,750 774,040 Net income
before provision for income taxes 145,828
(200,921 ) 337,965 484,619
Income taxes Provision for income taxes 43,748
(124,436 ) 101,389 66,824
Net income $ 102,080 $ (76,485 ) $ 236,576 $ 417,795
Net income per share $ 0.04 $ (0.03 ) $ 0.09
$ 0.15
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