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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: Herb Duncan who wrote (10716)	5/16/1998 1:08:00 AM
From: Kerm Yerman	Respond to of 15196

EARNINGS - TOP 20 LISTED / Northrock Resources 1st Quarter Results NORTHROCK RESOURCES LTD. TSE SYMBOL: NRK MAY 15, 1998 Northrock Resources Ltd. Announces First Quarter Results CALGARY, ALBERTA--Northrock Resources Ltd. ("Northrock") is pleased to announce its unaudited financial and operating results for the three months ended March 31, 1998. The first quarter of 1998 was highlighted by a record level of drilling activity, the execution of a Strategic Alliance agreement with Gulf Canada Resources Limited ("Gulf") in West Central Alberta and the acquisition of Paragon Petroleum Corporation ("Paragon"). During the quarter, Northrock drilled 75 wells that resulted in significant increases in reserve additions and production capability. Despite a weak crude oil pricing environment, Northrock was able to achieve netbacks of $12.05 per barrel of oil equivalent ("BOE") and added 7.2 million BOE of reserves at a cost of $5.95 per BOE reflecting the quality of its production and opportunity base. /T/ FINANCIAL (000's except per share amounts) 1998 1997 Percent Change ----------------------- --------- --------- --------------- Gross Production Revenue $ 35,226 $ 27,988 +26 Cash Flow from Operations 15,495 13,458 +15 Per Common Share 0.61 0.63 - 3 Net Earnings 1,802 3,622 -50 Per Common Share 0.07 0.17 -59 Capital Expenditures 42,597 34,298 +24 Acquisition of Paragon Petroleum Corporation 128,178 - N/A Sale of Properties - 43,256 N/A Long Term Debt 258,680 57,533 +350 Shareholders' Equity 210,641 144,944 +45 Weighted Average Number of Common Shares 25,603 21,476 +19 OPERATING Production Crude Oil (Bbls/d) 5,778 4,233 +36 Natural Gas Liquids (Bbls/d)3,467 1,824 +90 Natural Gas (MMcf/d) 97.6 66.0 +48 BOE (Bbls/d) 19,003 12,660 +50 Prices Crude Oil and Liquids ($/Bbl) $ 18.62 $ 26.31 -29 Natural Gas ($/Mcf) $ 2.25 $ 2.30 - 2 BOE ($/Bbl) $ 20.60 $ 24.56 -16 Netbacks Crude Oil and Liquids ($/Bbl) $ 10.09 $ 15.22 -34 Natural Gas ($/Mcf) $ 1.39 $ 1.35 + 3 BOE ($/Bbl) $ 12.05 $ 14.29 -16 /T/ Operating results for the first quarter of 1998 were on target with budget, however, financial results were impacted with lower crude oil prices. Total production increased 50 percent to 19,003 BOE per day in 1998 which contributed to an increase in gross production revenue to $35.2 million from $28.0 million for the same period in 1997. Cash flow from operations increased 15 percent to $15.5 million or $0.61 per common share while net earnings decreased 50 percent to $1.8 million or $0.07 per common share. Natural gas production for the first quarter of 1998 increased 48 percent to average 97.6 million cubic feet per day and natural gas prices remained strong at $2.25 per thousand cubic feet. Crude oil and liquids production increased 53 percent, while prices decreased 29 percent to average $18.62 per barrel from $26.31 per barrel for the first quarter of 1997. Despite the reduction in crude oil pricing, Northrock maintained a crude oil and liquids netback of $10.09 per barrel, reflecting the quality of the Company's crude oil mix which averages 38 degrees API. Capital expenditures in 1998 increased 24 percent to $42.5 million from $34.3 million. Approximately 80 percent of total exploration and development expenditures were directed towards drilling and completions. Seventy percent of the drilling activity was directed towards natural gas exploration. The first quarter activity generated estimated reserve additions of 7.2 million BOE, 81 percent of which was related to natural gas activities. The Company has moved quickly to integrate the Paragon acquisition and the new Strategic Alliance with Gulf into its aggressive drilling plans. Northrock participated in drilling 75 gross (49.0 net) wells in the first quarter of 1998, including 51 exploration wells. The Company's drilling program had a success rate of 71 percent as new pool discoveries were drilled at Sunchild, O'Chiese, Ferrier, Chambers, Brazeau and Judy Creek in West Central Alberta. The newly created Strategic Alliance with Gulf had a drilling success rate during the first quarter of more than 90 percent. In April 1998, Northrock completed an equity financing of 4.0 million common shares at $21.50 per share. The net proceeds will ensure that the Company can maintain its aggressive initiative on exploration and development with a total capital program for 1998 of approximately $200 million. The Company's current production is approximately 21,500 BOE per day with an estimated 4,000 BOE per day of behind pipe production capability. Building on the success of the first quarter, Northrock will maintain an aggressive drilling program with over 200 additional wells planned. The Company expects to achieve rapid production growth as existing and new found capacity is brought on stream, although logistical delays with natural gas development and a shift away from crude oil development will effect annual average production estimates. Exit production rates are expected to be more than 33,000 BOE per day. Northrock has established the foundation for strong long term growth as it capitalizes on its growing exploration and development opportunity base. Northrock is an oil and gas company listed on The Toronto Stock Exchange trading under the symbol "NRK".