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CALGARY, Nov. 25 /CNW/ - Tango Energy Inc. ("Tango": TSX Venture: TEI) is pleased to report on its unaudited financial and operating results for the nine months ended September 30, 2008.
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Three Months Ended Nine Months Ended
September 30, September 30,
2008 2007 2008 2007
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Financial Results
($000s, except per share amounts)
Gross revenues 1,670 2,270 7,397 8,573
Income (loss) before taxes (547) (1,570) (1,192) (1,997)
Net income (loss) (418) (1,074) (995) (1,433)
Per share - basic (0.01) (0.02) (0.02) (0.03)
Per share - diluted (0.01) (0.02) (0.02) (0.03)
Funds flow from
operations 514 698 2,991 4,355
Per share - basic 0.01 0.01 0.05 0.08
Per share - diluted 0.01 0.01 0.04 0.08
Additions to property and
equipment, net of (proceeds) 895 944 (7,902) 5,596
Total assets 38,599 41,813 38,599 41,813
Working capital (deficiency) 5,763 (323) 5,763 (323)
Asset retirement obligation 542 633 542 633
Flow-through share obligations 1,600 7,144 1,600 7,144
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Share Data (000s)
Equity outstanding
Common shares 65,775 65,725 65,775 65,725
Stock options and warrants 4,835 3,405 4,835 3,405
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Fully diluted 70,610 69,130 70,610 69,130
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Sales Volumes (average)
Natural gas (mcf/d) 1,697 4,187 2,590 4,269
Crude oil, liquids
and sulphur (bbls/d) 38 29 33 29
Average boe/d 321 727 465 742
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Product Prices (average)
Natural gas ($/mcf) 8.04 5.33 8.97 6.85
Crude oil and liquids ($/bbl) 101.28 77.31 100.10 65.48
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Netback Analysis ($/boe)
Oil and gas revenue 54.51 33.48 57.16 41.97
Gathering income 0.44 0.39 0.33 0.13
Royalty expense (17.48) (8.81) (16.67) (7.65)
Operating costs (12.64) (8.52) (9.54) (8.30)
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Netback 24.83 16.54 31.28 26.15
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Production averaged 321 barrels of oil equivalent per day ("boepd") during the three months ended September 30, 2008, a 56% decrease over the 727 boepd over the three months ended September 30, 2007. This decline in production was attributable to a combination of the sale of the Cecilia property as well as natural declines at Hanlan.
During the three months ended September 30, 2008, Tango focused on optimizing operated production. The construction of the pipeline at Quaich to tie in the 3-3 discovery well in which Tango has a 60% working interest, was delayed pending government approval. At the time of writing, the operator has received approval and the pipeline is under construction. It is expected that the pipeline will be completed during December 2008 and that the 3-3 well will be placed on production early in 2009, barring any unforeseen issues or difficulties.
Tango also acquired a partner's interest in joint properties located in the Blackstone area. Tango expects to conduct re-entry operations on one of the wells in which upside has been identified during 2009.
Also, Tango is participating in two additional exploratory wells in the Worsley and Ferrier areas prior to year end. Both the plays were evaluated on 3D seismic data and are multi-zone opportunities with the primary targets being the Leduc and Ellerslie formations respectively.
For a copy of Tango's September 30, 2008 Financial Statements and Management Discussion and Analysis please visit www.sedar.com.
Tango Energy Inc. is listed on the TSX-Venture Exchange under the Symbol TEI.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This release contains forward-looking information. By their nature, forward-looking statements involve assumptions and known and unknown risks and uncertainties that may cause actual future results to differ materially from those contemplated. These risks include such things as volatility of oil and gas prices, commodity supply and demand, fluctuations in currency and interest rates, ultimate recoverability of reserves, timing and costs of drilling activities and pipeline construction, new regulations and legislation and availability of capital. Tango does not undertake to update any such forward-looking statements except as required by law. Please refer to Tango's Annual Report for more detail as to the nature of these risks and uncertainties. Although Tango believes that the expectations represented by these forward looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.
Natural gas volumes have been converted to a barrel of oil equivalent ("boe") using six thousand cubic feet equal to one barrel unless otherwise stated. A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. This conversion conforms with Canadian Securities Regulators National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). Boe's may be misleading, particularly if used in isolation.
Funds flow from operations and funds flow from operations per share and netback are not recognized measures under Canadian generally accepted accounting principles. Management believes that these items are a useful measure of financial performance. Funds flow from operations is defined as net income plus non-cash charges including, depletion, depreciation and accretion, future taxes and stock-based compensation, after asset retirement costs. Funds flow from operations per share is calculated by dividing the weighted average number of shares outstanding during the year into funds flow from operations. Netback is the average per unit of volume for oil and gas revenues less royalties and production costs incurred. Netback is expressed in terms of dollars per boe.