****NEWS RELEASE****
6mo earnings four cents per share
TUSK Energy Inc TKE
Shares issued 9,735,000 Sep 1 close $1.25
Tue 1 Sept 98 News Release
Mr. Norm Holton reports
Highlights of the six months ended June 30, 1998 for Tusk Energy Inc.
included the drilling of two major oil discoveries and a gas discovery at
Strachan. At Meekwap, Alberta (17.6 per cent net) an oil discovery, which
went on production in April, continues to flow more than 1,300 boepd (229
net) with no water. A second oil discovery went on production in July and
is currently flowing at more than 880 boepd (155 net) with no water. Recent
discoveries have left Tusk with excellent potential to enhance the value of
the company with further drilling. Additional drilling in the Meekwap area
is expected during the winter season.
During the six months ended June 30, 1998 production averaged 563 boepd, an
11 per cent decrease from the 635 boepd average of the first half of 1997.
Oil prices, which averaged over $7.00 per barrel lower than in the first
half of 1997 and lower average daily production were the main cause in the
drop in cash flow to $820,450 for the quarter compared to $1,528,741 for
the six months ended June 30, 1997. Cash flow per share was nine cents per
share compared to 20 cents per share last year.
The operations of the company continued to show positive earnings despite
the downturn in oil prices. Net income per share was four cents compared to
six cents in 1997. Capital spending during the quarter was $2,184,359
during the first half compared to $2,103,307 one year earlier. At the end
of the period long term debt was $4,108,819 and working capital was
$124,306.
FINANCIAL HIGHLIGHTS
Six months ended June 30
1998 1997
Earnings $ 404,250 $ 540,241
Earnings per
share 4 cents 6 cents
Cash flow $ 820,400 $1,528,741
Cash flow
per share 9 cents 20 cents
Net revenue $1,915,489 $2,333,545
During the month of July average production was 838 boepd, annualized cash
flow was $2.5-million and annualized cash flow per share was 24 cents.
Tusk's primary producing area continued to be Meekwap, Alberta which
represented 80 per cent of Tusk's overall production during the period.
Tusk operates over 90 per cent of its net production.
During the period Tusk participated in the drilling of five wells (0.76
net) resulting in one gas well, two oil wells and two dry holes. The
abandoned wells (0.32 net) were at Pine Creek (0.20 net) and east of
Meekwap (0.12 net). The two oil wells were both at Meekwap (0.34 net) amd a
deep exploratory test at Strachan (Tusk 10 per cent BPO, 30 per cent APO)
is a gaswell. Further information on the Strachan project is expected to be
released in late September.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com
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