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Gold/Mining/Energy : t. upton resources -- Ignore unavailable to you. Want to Upgrade?

To: The Fix who wrote (50)	5/20/1999 12:17:00 AM
From: Fuller	Read Replies (1) \| Respond to of 86

Attention Business/Financial Editors: Upton Gears up to Add Production and Cash Flow CALGARY, May 19 /CNW/ - Upton Resources Inc. today released results for the first quarter ended March 31, 1999. Upton's strategy to manage the longest low oil price slump in recent history was modified for the first quarter. In previous quarters Upton concentrated on drilling and property acquisitions that would add reserves and development drilling locations positioning the company for a strong comeback with the return of healthier oil prices. In the first quarter Upton did not conduct a drilling program. Cash flow was used for minor property acquisitions and to improve the company's balance sheet. The combination of a low oil price and reduced production levels of 3,428 barrels per day resulted in Upton generating cash flow of $1.25 million and $0.07 basic cash flow per share. West Texas Intermediate averaged US $13.06 per barrel translating to a wellhead realization of Cdn $16.91 per barrel. Also negatively impacting results for the quarter was the one-time cost of purchasing in the money value of stock options. This transaction avoided the dilution of 401,000 shares at $1.20 per share. The cost of $366,000 increased general and administrative expenses and reduced cash flow for the quarter. Outlook ------- With no drilling to date, 1999 for Upton Resources begins June 1st. Our 1998 drilling success set the stage to move to an active drilling program with the return to higher crude oil prices. With WTI prices now above US $17.00, we can begin adding production volumes by mid June. The summer drilling program will have two benefits. First, drilling costs are cheaper in the summer months allowing for a maximization of capital expenditures and second, the added volumes will attract higher realized crude prices than existed in the first quarter. Upton has plans to drill 15 development wells in 1999, elevating production to an exit rate above 4,000 barrels per day. Eleven horizontal wells with an average working interest of 91% are forecast to net Upton 1,350 BOPD by year end. Four vertical development wells all at 100% working interest should account for another 225 barrels a day. Exploration drilling will see four or five wells targeting new reserves and production not included in the forecast. The future looks very promising for Upton. Increased cash flow due to improving oil prices in the second quarter will be welcomed. Production additions in the third and fourth quarters, combined with U.S. $17.00 WTI, dramatically increase cash flow. The new volumes should help fourth quarter annualized cash flow exceed $13 million ($0.74 a share). This should set the stage for further production and cash flow growth in year 2000. HIGHLIGHTS Three months ended March 31 1999 1998 % Change Production - barrels per day 3,428 5,289 -35 - total barrels 308,500 475,966 -35 Drilling activity - gross wells 0 14 -100 - net wells 0 8.7 -100 Petroleum revenues (000's) $ 5,218 $ 9,302 -44 Cash flow (000's) $ 1,250 $ 4,886 -74 Basic cash flow per share $ 0.07 $ 0.29 -76 Fully diluted cash flow per share $ 0.07 $ 0.28 -75 Net earnings (loss) (000's) $ (412) $ 445 -193 Basic net earnings (loss) per share $ (0.02) $ 0.03 -167 Fully diluted net earnings (loss) per share $ (0.02) $ 0.03 -167 Capital expenditures (000's) $ 617 $ 7,506 -92 Average shares outstanding (000's) 17,631 16,634 +6 Fully diluted shares outstanding (000's) 18,883 17,452 +8 Average oil price per barrel $ 16.91 $ 19.54 -13 Operating costs per barrel $ 3.61 $ 3.24 +11 Operating netback per barrel $ 9.42 $ 12.49 -25 Cash netback per barrel $ 4.05 $ 10.27 -61 The common shares of Upton are listed on the Toronto Stock Exchange under the symbol ''URC''. This information has been neither approved nor disapproved by the Toronto Stock Exchange Website: www.uptonres.ca E-Mail Address: upton(at)uptonres.ca -0- 05/19/1999 For further information: Scott Dutton, President & C.E.O., Upton Resources Inc., (403) 218-6080; Phil Grubbe, V.P. Finance & C.F.O., Upton Resources Inc., (403) 218-8978; Andre St. Onge, Vice President, Exploration, Upton Resources Inc., (403) 218-6092 -------------------------------------------------------------------------- Release sent courtesy of Canada NewsWire Portfolio Email. To update your email portfolio, point your web browser here: portfolio.newswire.ca Please address any questions about your portfolio to cnw@newswire.ca E-Pix Now you can call the shots with E-Pix, Canada's first - and the only - corporate newswire database of client-controlled pictures and images. Developed in conjunction with, and managed by The Canadian Press, E-Pix offers free photos and images to all CP member newspapers. E-PIX combines state-of-the-art, electronic picture desk access with Internet -based software to allow the news media to download high-resolution images quickly and easily. Contact your local CNW Office to promote your company image. --------------------------------------------------------------------------