HOUSTON, May 4 /CNW/ - Enhanced Oil Resources Inc. (TSX-V: EOR) today
announces its audited financial results for the year ending December
Results of operations for the year ended December 31, 2010, included
crude oil and natural gas sales revenues of $10.3 million, and a net
loss of $1.0 million, compared to revenues of $5.3 million and a net
loss of $6.2 million for the year ended December 31, 2009. Oil
production for 2010 totaled 166,210 gross oil equivalent barrels
("Boe"), an increase of 73% over the 96,237 gross Boe produced in 2009.
Improving oil prices also contributed to the Company's increased
revenue, with the Company's oil production averaging US $75.40 per Boe
for 2010 as compared to US $59.54 per Boe for 2009. These results
continue a trend begun in late 2009 of increased oil production and
improved oil prices that has resulted in increased cash flows from
operating activities. Cash flows provided by operating activities for
2010 were $2.6 million compared to cash used in operating activities of
$2.2 million in 2009, with 2010 representing the first full year of
positive operating cash flow in the Company's history. Our lifting
costs increased to US $19.68 per Boe for 2010 as compared to US$13.87
per Boe for 2009, primarily as a result of increased water disposal
costs at Crossroads field, and workover costs in our more marginally
economic fields initiated primarily as a result of increased regulatory
requirements. For the fourth quarter of 2010, the Company reported a
net loss of $0.7 million compared to a net loss of $0.2 million for the
fourth quarter of 2009, principally related to increased personnel cost
and an unrealized loss on crude oil derivative contracts related to
future oil production.
In 2010, the Company's oil production averaged 455 BOPD compared to an
average of 349 BOPD in 2009. Production costs for 2010 increased
significantly over 2009 to $4.2 million as compared to $1.7 million,
due to increases associated with our higher production volumes.
Production costs also included an increase in workover costs in the
Chaveroo and Milnesand fields, principally related to responses to
regulatory activity in these two fields and a period of increased water
hauling costs from April thru June at the Crossroads field when we
expanded our water handling and disposal facilities.
At December 31, 2010, we had cash on hand of $0.6 million and working
capital of $0.2 million, a decrease of $0.8 million in cash and $1.2
million in working capital since December 31, 2009.
Our general and administrative costs decreased $0.5 million to $3.3
million for the year 2010 as compared to $3.8 million in 2009,
principally associated with reduced personnel costs in 2010 compared to
2009, including reductions in related travel and other related general
and administrative expenses.
Chief Executive Officer Barry Lasker stated "2010 was a watershed year
for the Company as the $2.6 million of cash provided from operations
was the first operating cash flow in its history. We continue to work
diligently to increase production from our New Mexico oilfields and to
further enhance the value at St Johns. Our focus for the remainder of
this year is to initiate our infill drilling program at Milnesand,
drill our final two commitment wells at St Johns and to prepare the
necessary filings for the proposed St Johns Helium extraction and
liquefaction plant. We thank our shareholders for their support this
The Company also announces the grant of incentive stock options to
members of the Company's Board of Directors, management and employees
entitling the purchase upon vesting, for a period of five years, of
1,710,000 shares of the Company's Common Stock at a price of $0.25 per
share pursuant to the terms of the Company's Stock Option Plan approved
by shareholders on November 18, 2010.
About Enhanced Oil Resources Inc.
Enhanced Oil Resources Inc. is an early-stage company, with two
principal business segments of
(i) Crude oil and natural gas production through enhanced oil
recovery ("EOR") projects it is initiating in the Permian Basin on oil
fields acquired by the Company in 2007 and 2008 for that purpose.
(ii) Helium and CO2 resource exploration and production through property interests it
controls in approximately 251,000 gross acres of land within the St
Johns Helium/CO2 field in Arizona and New Mexico, and where the Company is developing
what is thought to be the largest undeveloped helium and carbon dioxide
field in North America.
Certain statements contained herein are forward-looking statements,
including statements relating to Enhanced Oil Resources' operations;
business prospects, expansion plans and strategies. Forward-looking
information typically contains statements with words such as "intends,"
"anticipate," "estimate," "expect," "potential," "could," "plan" or
similar words suggesting future outcomes. Readers are cautioned not to
place undue reliance on forward-looking information because it is
possible that expectations, predictions, forecasts, projections and
other forms of forward-looking information will not be achieved by
Enhanced Oil Resources. By its nature, forward-looking information
involves numerous assumptions, inherent risks and uncertainties. A
change in any one of these factors could cause actual events or results
to differ materially from those projected in the forward-looking
information. Although Enhanced Oil Resources believes that the
expectations reflected in such forward-looking statements are
reasonable, Enhanced Oil Resources can give no assurance that such
expectations will prove to be correct. Forward-looking statements are
based on current expectations, estimates and projections that involve a
number of risks and uncertainties which could cause actual results to
differ materially from those anticipated by Enhanced Oil Resources and
described in the forward-looking statements or information. The
forward-looking statements are based on a number of assumptions which
may prove to be incorrect. Readers should be aware that the list of
factors, risks and uncertainties set forth above are not exhaustive.
Readers should refer to Enhanced Oil Resources' current filings, which
are available at www.sedar.com, for a detailed discussion of these
factors, risks and uncertainties. The forward-looking statements or
information contained in this news release are made as of the date
hereof and Enhanced Oil Resources undertakes no obligation to update
publicly or revise any forward-looking statements or information,
whether as a result of new information, future events or otherwise,
unless so required by applicable laws or regulatory policies.
ON BEHALF OF THE BOARD OF DIRECTORS
Barry D Lasker, CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
SOURCE Enhanced Oil Resources Inc.
For further information:
For more information visit our Website at www.enhancedoilres.com. or please call Don Currie on 1-888-990-3551.