Biloxi Marsh Lands Corporation (PINK SHEETS: BLMC) today
announces its unaudited results for the third quarter and first
nine months of 2011 and provides update. The Company’s direct net
oil and gas revenues generated from its fee lands were $307,632 for
the third quarter of 2011 compared to $439,453 for the third
quarter of 2010. For the first nine months direct oil and gas
revenues increased to $1,176,421 from $1,085,389 for the same
period of 2010. During the third quarter, revenues from Dividends
and Interest, Gain on Sale of Securities and Miscellaneous Income
decreased to $135,198 from $183,490 for the third quarter of 2010.
Meanwhile, for the first nine months of 2011 Dividends and
Interest, Gain on Sale of Securities and Miscellaneous Income
increased to $833,288 from $370,704 for the first nine months of
2010.
During the third quarter, the Company incurred a loss of
$687,747 emanating from partnership income which represents the
Company’s investment in B&L Exploration, LLC (B&L). This
compares to a net gain of $53,056 in the same category for the
third quarter of 2010. The loss emanating from the Company’s
investment in B&L is directly related to B&L drilling four
wells during the second and third quarters 2011 and completion cost
related to three of these four wells. As previously reported, this
means that three wells are being or have been completed as
commercial oil and gas wells and one well was plugged and abandoned
as a dry-hole. It is important to note that a major component of
the $2,462,807 loss reported for the first nine months of 2011
includes $1,000,451 in Depreciation, Depletion and
Amortization.
The Company’s operating expenses for the third quarter of 2011
were reduced to $195,300 compared to $225,694 for the same period
of 2010. The Company had a net loss of $175,299 or $.06 per share
for the third quarter of 2011 compared to a profit of $315,241 or
$.11 per share for the same period of 2010. For the first nine
months of 2011 the company’s net loss was $746,189 or $.27 per
share compared to a net profit of $551,790 or $.20 per share for
the first nine months of 2010.
As of September 30, 2011 the combined gross daily production
rate from 4 wells operated by the Company's mineral Lessees was
approximately 7.04 mmcf of natural gas with net daily production
accruing to the Company of approximately 947 mcf. 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
September 30, 2011 approximately 3.8 mmcfe (million cubic feet of
natural gas equivalents) per day.
B&L was very active during the first nine months of 2011, as
previously reported B&L participated in the drilling of four
wells during the second and third quarters with three being
completed as commercial oil and gas wells. As of the date of this
report only the Harry Bourg No. 1 well has been placed on
production, while the SL 19076 No. 1 Well and the Continental Land
& Fur (CL&F) No. 1 Well have been successfully flow tested,
and are awaiting facility construction and hook up.
B&L placed its Harry Bourg Corporation No. 1 Well on
production on September 13, 2011. Initial production rates from
this well were approximately 2.0 mmcfg/day on 10.5/64th choke with
a flowing tubing pressure (FTP) of approximately 3,840psi. The
condensate yield is approximately 120 bbls per 1.0 mmcfg. B&L
is the Operator of the Harry Bourg No. 1 well and currently has a
28% working interest.
On September 24th and 25th Clayton William Energy (CWE), the
Operator of the SL 19076 No. 1 Well, successfully flow tested the
lower three sand intervals. During the flow tests all three
intervals produced natural gas and natural gas liquids with very
little draw pressure down indicating that all three zones are
commercial. As previously reported, electric logs indicate
approximately 220 net feet of pay in 7 different sand intervals.
The upper 4 pay zones will be perforated and flow tested at a later
date. CWI advises that the well should be placed on production from
the lower zone during late December 2011 or early January 2012.
B&L currently has a 15% non-operating working interest in this
well.
The CL&F No. 1 Well was flow tested on September 27th. This
well is operated by Forza Operating Company (Forza). Electric Logs
indicated approximately 8’ of pay with sidewall cores indicating
condensate. During the flow test, this well flowed at a sustained
rate of 1.5 mmcfg/day, 140 bbls of natural gas liquids and no water
production with a FTP of 7360psi on 7/64th choke. Forza estimates
that this well will be placed on production during the first
Quarter of 2011. B&L has a 9.375% non-operating working
interest in this well.
As of October 16, 2011 the combined gross daily production rate
from 6 wells in which B&L has a working interest was
approximately 12.4 mmcf of natural gas and 338 barrels (bbls) of
oil and natural gas liquids with net daily production accruing to
B&L of approximately 2.7 mmcfg and 66 bbls of oil and natural
gas liquids. Combining this daily production with the Company's
proportional share of the daily production from the B&L wells
makes the total net daily production accruing to the Company as of
October 16, 2011 approximately 4.1 mmcfe (million cubic feet of
natural gas equivalents) per day.
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.
Meanwhile, Biloxi’s consulting staff continues to work on the
development of additional prospects on our fee lands. Despite the
relatively low natural gas pricing environment, we continue to
actively market our deep Tuscaloosa prospects and have reprocessed
a small area of 3D seismic data in the Company’s possession. This
reprocessing has yielded several relatively shallow geophysical
leads which we hope, after more work, will be considered viable
prospects to drill.
William B. Rudolf, President and CEO, commented: “While we
continue to work on refining our fee based land prospects through
seismic reprocessing, geological and geophysical interpretation, we
are pleased with the initial flow rates of B&L’s Harry Bourg
No. 1 well. This well’s high condensate yield is notable. We are
also pleased with the results of the flow tests on B&L’s SL
19076 No. 1 and the CL&F No. 1 wells. The SL 19076 No. 1
represents a fairly significant discovery for B&L and should,
along with the other recent discoveries, be additive from both a
proved reserve and revenue perspective. B&L’s diversification
into different geographic areas within southern Louisiana with
oil/condensate production should help us during this period of
relatively low natural gas prices compared to oil prices. For an
entity in its infancy, B&L has performed well allowing the
Company to transform from a self-liquidating mode into a growth
mode. The tax efficiencies created by our investment in B&L
combined with its diversified production are additional benefits
and create an opportunity to continue B&L’s drilling program
during 2012.”
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 “indicates”,
“approximate”, “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 September 30, 2011 and 2010
Assets 2011 2010
Current assets: Cash and cash equivalents $ 3,327,573 6,433,485
Accounts receivable 124,833 206,109 Prepaid expenses 59,519 59,063
Accrued interest receivable 34,556 55,995 Federal income taxes
receivable 87,282 8,437 State income taxes receivable 27,861 65,843
Deferred tax asset 476,069 — Other assets 3,830 3,830 Total current
assets 4,141,523 6,832,762 Other assets: Investment in partnership
2,296,094 2,902,539 Marketable debt and equity securities - at cost
11,006,055 8,506,359 Land 234,939 234,939 Levees and office
furniture and equipment 295,166 257,496 Accumulated depreciation
(295,166) (257,496) Total other assets 13,537,088 11,643,837
Total assets $ 17,678,611 18,476,599
Liabilities and
Stockholders' Equity Current liabilities: Accrued expenses
21,944 10,781 Other current liabilities 35,313 3,960 Total current
liabilities 57,257 14,741 Stockholders' equity:
Common stock, $.001 par value. Authorized
20,000,000 shares; issued 2,851,196 shares; outstanding 2,738,428
shares in 2011 and 2,741,428 shares in 2010
47,520 47,520 Retained earnings 17,806,899 18,597,403 Treasury
stock - 112,768 shares in 2011 and 109,768 shares in 2010 (233,065)
(183,065) Total liabilities and stockholders' equity $ 17,678,611
18,476,599
BILOXI MARSH LANDS CORPORATION Statements of
Revenues and Expenses September 30, 2011 and 2010
3 Months Ended 9 Months Ended
September 30 September 30 2011
2010 2011
2010 Revenues: Oil and Gas
Royalties $ 322,388 $ 452,906 $ 1,229,910 $ 1,109,537 Severance
Taxes $ (14,756 ) (13,453 ) (53,489 ) (54,148
) Oil and gas royalties, net 307,632 439,453 1,176,421 1,055,389
Delay Rentals - - -
30,000 Total oil and gas revenues
307,632 439,453 1,176,421
1,085,389
Other: Income (loss) from investment
in partnership (687,747 ) 53,056 (2,462,807 ) 79,621 Dividends and
interest income 57,069 85,329 191,487 247,298 Gain on sale of
securities 58,623 68,311 612,045 85,924 Other Income 19,506
29,850 29,756 37,482
Total other income (552,549 ) 236,546
(1,629,519 ) 450,325 Total
revenues and income (244,917 ) 675,999
(453,098 ) 1,535,714
Expenses
Total expenses 195,300 225,694
769,160 747,444 Net income before
provision for income taxes (440,217 ) 450,305
(1,222,258 ) 788,270
Income
taxes Provision for income taxes (264,918 )
135,091 (476,069 ) 236,480 Net
income $ (175,299 ) $ 315,214 $ (746,189 ) $ 551,790
Net income per share $ (0.06 ) $ 0.11 $
(0.27 ) $ 0.20
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