EARNINGS / Oxbow Q1 Results
OXBOW EXPLORATION INC. ANNOUNCES FIRST QUARTER RESULTS
CALGARY, May 26 /CNW/ - OXBOW EXPLORATION INC. is pleased to announce its
operational and financial results for the three month period ended March 31,
1998. Oxbow Exploration Inc. achieved a record average production level for
the quarter of 2,293 BOE per day. This represents a 102 percent increase in
production compared to the first quarter of 1997 and is an increase of 19
percent over the previous quarter. The first quarter production level would
have been higher but operational delays related to rig availability and
equipment delivery impacted results.
During the first quarter of 1998 Oxbow drilled six wells (1.6 net wells)
resulting in 2 oil wells (0.6 net), 2 gas wells (0.7 net) and 2 dry holes (0.3
net) for a drilling success rate of 82%. Five of the wells were drilled on
lands acquired from Samedan.
Development wells drilled at Rigel and Meekap were particularly
successful. An underbalanced horizontal development well at Rigel, Oxbow's
50% owned Halfway oil property, commenced production at over 800 BOPD (400
BOPD net to Oxbow). A vertical well at Meekwap flowed at rates averaging in
excess of 1,700 bpd (110 bpd net to Oxbow), roughly doubling the production
from the property. Additional development drilling is planned at both Rigel
and Meekwap over the summer.
Exploration success continued at Oxbow's Noel BC gas property. Another
exploratory gas well was drilled and cased in the first quarter. Completion
and tie-in of the new Noel well is scheduled for late 1998. Overall, Oxbow
has cased 4 out of 5 exploratory wells at Noel. Subsequent to the quarter end,
Oxbow acquired additional assets in the Noel area that added approximately 4
MMCFD of new production. Current Noel production is approximately 10 MMCFD
net to the Company.
During the first quarter revenue increased by 33% to almost $4 million
while net production income increased by 28% to almost $2 million as compared
to the similar period in 1997. Cash flow from operations was $1.4 million, an
increase of 15% from the 1997 quarter. A loss of $682 thousand was reported
for the first quarter compared to an income gain of $406 thousand reported in
1997. The loss resulted from a combination of lower oil prices and an
increase in the depletion rate reflecting a revision to proved reserves
associated with Oxbow's Macoun property following an independent engineering
evaluation in late 1997.
<<
For the 3 months ended March 31
1998 1997 Percent
Operational Change
------------------------------------------------------------------------
Production BOE/D 2,293 1,132 +102
Oil & NGL STB/D 1,627 1,132 + 43
Natural Gas MCF/D 6,660 0
Average sales price
Oil & NGL $/STB $19.60 $29.09 - 33
Natural Gas $/MCF $1.78 -
For the 3 months ended March 31
Financial ($000s, 1998 1997 Percent
except per share amounts) Change
------------------------------------------------------------------------
Oil and natural gas revenue 3,955 2,964 + 33
Net production income 1,954 1,524 + 28
Funds from operations 1,412 1,226 + 15
Per share, basic 0.04 0.05 -12
Net earnings (Loss) (682) 406
Per share, basic (0.02) 0.02
>>
Geoff Williams, President and CEO of Oxbow commented, ''Unfortunately,
this strong growth in production in the quarter was accompanied by a decline
in oil prices. However, Oxbow's production levels continue to increase and the
product mix is currently 35 percent natural gas. With our existing inventory
of exploitation and exploration projects, Oxbow is positioned to deliver a
solid year in terms of production and cash flow growth in spite of weak oil
prices.''
OXBOW EXPLORATION INC. is a full cycle exploration and development oil
and gas company located in Calgary. Its operations extend throughout the
Western Canadian Sedimentary Basin. OXBOW is listed on the Alberta and
Toronto Stock Exchanges under the trading symbol ''OXB''
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For further information: Geoff Williams or Don Schott, (403) 237-8944,
Fax: (403) 262-2828
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