Kodiak Oil & Gas Corp. Reports Third Quarter 2008 Results

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[{"type":"text","content":"\n\n\n\nDENVER, Nov. 5 /CNW/ -- Kodiak Oil & Gas Corp. (NYSE Alternext US: KOG),\nan oil and gas exploration and production company with assets in the Green\nRiver Basin of southwest Wyoming and Colorado and the Williston Basin of North\nDakota and Montana, today reported financial and operating results for the\nthird quarter 2008.\n\n\nPlease reference Kodiak's simultaneously issued news release entitled\n"Kodiak Oil & Gas Corp. Announces Preliminary 2009 CAPEX, Exploration Joint\nVenture and Updates Operations" for further discussion of events subsequent to\nthe third quarter 2008.\n\n\nThird Quarter Financial Results\n\n\nThe Company reported a net loss for the quarter-ended September 30, 2008,\nof $18.0 million, or $0.20 per basic and diluted share, compared with a net\nloss of $22.0 million, or $0.25 per basic and diluted share, for the same\nperiod in 2007. The 2008 and 2007 periods' net loss include $15.5 million and\n$20.0 million, respectively, in non-cash charges related to an impairment of\nthe carrying value of oil and gas properties.\n\n\nAs of September 30, 2008, based on oil and gas prices of $87.81 per\nbarrel of crude oil and $4.69 per Mcf of natural gas, the value of Kodiak's\nproved reserves as calculated under SEC guidelines did not support the costs\nincluded in the full cost pool. Consequently, the Company recorded an asset\nimpairment of $15.5 million during the three month period ended September 30,\n2008. The impairment primarily relates to falling commodity prices and a\nrevision of our previously recorded proved undeveloped locations (PUD). In\ncomparison to prices at September 30, 2008 noted above, average prices\nreceived during the third quarter were $107.47 per barrel of crude oil and\n$3.57 per Mcf of natural gas and average prices received during October 2008\nprices were $62.56 per barrel of crude oil and $3.59 per Mcf of natural gas. \nAs a result of the deteriorating commodity prices and the Company's strategy\nto focus its capital expenditures on the Bakken oil play in North Dakota, we\nreassessed all of our PUDs. Based on the uncertain timing of any potential\ndrilling program on these PUDs and the current environment of lower commodity\nprices, the present value of these PUDs was deemed non-commercial. \nAccordingly, we recorded an impairment charge for a significant porti...

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