Bellamont Exploration Ltd. announces third quarter results



    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
    THE UNITED STATES/

    CALGARY, Nov. 27 /CNW/ - Bellamont Exploration Ltd. (the "Corporation" or
"Bellamont") (TSXV:BMX.A) (TSXV:BMX.B) is pleased to reports it third quarter
financial and operational results.

    THIRD QUARTER OPERATIONAL AND CORPORATE HIGHLIGHTS

    
    -   Entered into an agreement to acquire approximately 150 boed in the
        Corporation's core area of northwest Alberta and British Columbia,
        which was subsequently closed on October 22, 2007.

    -   Entered into a wide area farm-in agreement (the "Farm-in Agreement")
        targeting light sweet oil in southeast Saskatchewan, pursuant to
        which the Corporation has access to farm-in on 279 gross sections
        (178,000 gross acres) in a 12 square township block.

    -   Incurred capital expenditures of approximately $2.8 million.

    -   Drilled 3 (1.85 net) new wells resulting in 2 (0.85 net) new pool
        natural gas discoveries and 1 (1 net) dry hole.

    -   Commenced an 82 square mile three dimensional ("3D") seismic program
        in southeast Saskatchewan pursuant to the Farm-in Agreement.

    -   Averaged production of 91 boed in the third quarter of 2007.
        Inclusive of the acquisition in the third quarter, Bellamont is now
        producing approximately 325 boed with additional behind pipe capacity
        from its two new pool discovery wells.

    -   Exited the third quarter with a working capital surplus of
        $7.1 million.
    

    ACQUISITIONS

    On September 10, 2007, the Corporation entered into an acquisition
agreement to acquire production of approximately 150 boed comprised 77% of
natural gas and 23% of light sweet oil (38 degrees API) for total
consideration of $3.54 million. The consideration was comprised of $2 million
cash and 1,538,461 Bellamont class "A" common shares with a deemed price of
$1.00 per share (the "Acquisition"). The main properties in the acquisition
are operated properties located in the Gold Creek Area of Alberta and the
Clarke Lake Area of British Columbia. The Acquisition was subsequently closed
on October 22, 2007.
    On November 23, 2007 the Corporation closed an acquisition of a private
oil and gas company. The acquisition of the private company increased
Bellamont's working capital surplus by approximately $2.6 million and based on
an independent reserve report dated March 31, 2007 prepared by McDaniel &
Associates Consultants Ltd., adds probable reserves of 50 mboe from the
properties located in the Red Creek Area of British Columbia and the Radway
and Jarvie areas of Alberta. The total consideration paid to the private
company shareholders was 2,882,250 Bellamont Class A shares and $387,043 cash.

    SOUTHEAST SASKATCHEWAN WIDE AREA FARM-IN AGREEMENT

    On September 10, 2007 the Corporation entered into a wide area farm-in
agreement (the "Farm-in Agreement") targeting light sweet oil in southeast
Saskatchewan pursuant to which the Corporation has access to farm-in on
279 gross sections (178,000 gross acres) in a 12 square township block. In
accordance therewith, the Corporation agreed to: 1) participate for a capital
commitment of $3.5 million in an 82 square mile three dimensional ("3D")
seismic program over a portion of the farm-in lands that has never previously
been imaged with 3D seismic; and 2) spud a commitment well by June 1, 2008 to
evaluate down to the Red River formation. To aid in the determination of
drilling locations, the Farm-in agreement provides for Bellamont to have
access to review the Farmor's existing seismic database in the vicinity of the
farm-in lands, consisting of 230 miles of two dimensional ("2D") seismic data
and 80 square miles of 3D seismic data.
    Bellamont has recently concluded the field operations for the 3D seismic
program and expects all the data to be processed and ready for interpretation
by the second week of December. To date, Bellamont has identified 12 drilling
leads on the Farmor's existing seismic database, two of which of multi-zonal
potential in the Red River and Duperow formations. Based on the large amount
of mainly contiguous land that is covered by the new 82 square 3D seismic
program, Bellamont is optimistic the program will generate numerous additional
drilling opportunities.
    The southeast Saskatchewan farm-in lands are prospective in five separate
zones which include the Birdbear, Duperow, Winnipegosis, Red River and
Winnipeg. All of these prospective formations are light oil prone
(35-37 degrees API) and would be eligible for the Saskatchewan Crown royalty
holiday for deep vertical oil wells. Each of these formations is potentially
prolific. The first year daily average production rates for all the wells
producing from these formations in the vicinity of the farm-in lands ranges
from 48 boed (Birdbear) to 170 boed (Duperow). The very best wells had first
year average production rates ranging from 233 boed (Birdbear) to 733 boed
(Winnipegosis). For more information regarding the Farm-in Agreement, please
see Bellamont's corporate presentation on Bellamont's web page at
www.bellamont.com.

    OPERATIONS

    In the third quarter, the Corporation incurred capital expenditures of
approximately $2.8 million. The expenditures were predominantly on drilling,
completion and equipping operations, the highlights of which are two
(0.85 net) new pool discovery wells.
    The first discovery well, in which Bellamont has a 45.0% working
interest, was a Bellamont operated well in the Whitelaw Area of the Peace
River Arch that drill stem tested six separate zones cumulatively in excess of
5.8 million cubic feet per day ("mmcf/d") (gross). This well has since been
dually completed in one of the zones previously tested and a zone which had
not been tested. Together these two zones production tested at a combined rate
in excess of 1.75 mmcf/d (gross). This well has been recently placed on
production at a restricted production rate of approximately 300 mcf/d (gross).
The Corporation is currently investigating various options to maximize
production from this well. Furthermore, elimination of the current restriction
will allow the company to drill a twin to the existing well, enabling the
Corporation to produce several of the other formations that tested
hydrocarbons in the discovery well.
    The second discovery well, in which Bellamont has a 40% working interest,
is a non-operated well located in Central Alberta. The well has been completed
and production tested at a rate in excess of 1.4 mmcf/d (gross). This well is
expected to be producing in the first quarter of 2008.
    Since its IPO in December of 2006, Bellamont has drilled 15 wells
(13.1 net) and re-entered an additional well (1 net), resulting in 7 (6.7 net)
oil wells and 4 (2.4 net) gas wells and 5 (5.0 net) dry holes, for a success
rate of 69.0%. Bellamont has initiated an active fourth quarter drilling
program with a minimum of four (3.1 net) exploration wells to be drilled in
the Corporation's core Peace River Arch area before the end of the year.

    FINANCIAL

    The Corporation exited the third quarter with a working capital surplus
of $7.1 million. Coincident with the closing of the Acquisition the
Corporation has established a $3.5 million credit facility with a major
Canadian chartered bank, which is currently undrawn.
    Operating costs in the third quarter were $24.68 per boe, which continues
a downward trend since the first quarter. These costs are reflective of the
start up costs of the company's newly drilled wells and do not include
production from the Acquisition. The production acquired, approximately
150 boed, has historical operating costs of less than $13.00 per boe. On a
pro-forma basis, the acquired production will serve to reduce the
Corporation's operating costs on a boe basis. With the new production expected
from the Whitelaw and Central Alberta wells, the Corporation expects operating
costs to be further reduced, with additional reductions possible should the
Corporation successfully eliminate the capacity bottlenecks in Whitelaw.
    To November 26, 2007, Bellamont has incurred CEE qualifying expenditure
totaling $9.6 million and for the remaining obligation of $1.4 million,
Bellamont has a program in place to ensure the obligation is expended by
December 31, 2007.
    The Corporation has filed its unaudited financial statements and related
management's discussion and analysis ("MD&A") for the quarter ended
September 30, 2007, with Canadian securities regulatory authorities on the
System for Electronic Document Analysis and Retrieval ("SEDAR"). Copies of
these documents may be accessed electronically on SEDAR at www.sedar.com or at
www.bellamont.com. Certain selected financial and operational information for
the quarter ended September 30, 2007 and 2006 comparatives are set out below
and should be read in conjunction with Bellamont's financial statements and
MD&A.

    
                                  Three Months Ended       Nine Months Ended

                                    2007        2006        2007        2006
    -------------------------------------------------------------------------
    Financial ($)
    -------------------------------------------------------------------------
    Petroleum and natural
     gas sales                   552,290      51,387     995,763     111,630
    Funds provide by/
     (used in) operations(1)      10,318     (35,780)   (478,284)    (66,047)
      Per share basic                 (-)      (0.02)      (0.02)      (0.03)
      Per share diluted               (-)      (0.02)      (0.02)      (0.03)
    Net Loss and
     Comprehensive Loss         (163,493)   (531,164)   (800,644)   (589,524)
      Per share basic              (0.01)      (0.23)      (0.03)      (0.30)
      Per share diluted            (0.01)      (0.23)      (0.03)      (0.30)
    Capital expenditures       2,851,774   1,223,325   8,847,769   1,428,970
    Net working capital
     surplus                   7,091,604     303,073   7,091,604     303,073
    -------------------------------------------------------------------------
    Operating
    -------------------------------------------------------------------------
    Production
      Crude oil
       (Bbls per day)                 61           -          33           -
      Natural gas
       (Mcf per day)                 177          84         177          65
      Natural gas liquids
       (Bbls per day)                  1           1           1           -
      Barrels of oil
       equivalent
       (Boe per day, 6:1)             91          15          63          11
    Average realized price
      Crude oil ($ per Bbl)        83.29           -       74.71           -
      Natural gas ($ per Mcf)       5.04        5.95        6.46        5.97
      Natural gas liquids
       ($ per Bbl)                 64.69       63.19       57.09       65.14
      Barrels of oil equivalent
       ($ per Boe, 6:1)            65.87       37.31       57.76       36.63
    Netback per Boe (6:1) ($)
      Petroleum and natural
       gas sales                   65.87       37.31       57.76       36.63
      Royalties                   (15.05)      (6.07)     (12.16)      (7.30)
      Operating expenses          (24.68)     (14.32)     (30.47)     (13.12)
      Transportation expenses      (0.95)      (1.23)      (2.16)      (1.22)
    -------------------------------------------------------------------------
    Operating Netback              25.19       15.69       12.97       14.99
    -------------------------------------------------------------------------

    Undeveloped land holdings
      Gross acres                 20,876      11,116      20,876      11,116
      Net acres                   17,564       8,748      17,564       8,748
      Average working interest     84.1%       78.7%       84.1%       78.7%

    -------------------------------------------------------------------------
    Common Shares
    -------------------------------------------------------------------------
    Shares outstanding,
     end of period
      Class A Shares          21,349,821   1,800,000  21,349,821   1,800,000
      Class B Shares           1,012,000           -   1,012,000           -
    Weighted average shares
      Basic Shares
       Outstanding(2)         31,469,821   2,260,788  26,011,946   1,955,284
      Diluted Shares
       Outstanding(2)         32,015,940   2,260,788  26,555,270   1,955,284
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) Management uses funds used in operations to analyze operating
        performance and leverage. Funds used in operations as presented does
        not have any standardized meaning prescribed by Canadian GAAP and
        therefore it may not be comparable with the calculation of similar
        measures for other entities.

    (2) For the period ended September 30, 2007 the Class B shares are
        converted at the quarter-end Class A share price of $1.00 and added
        to the Class A shares to calculate basic shares and the diluted
        shares outstanding.
    

    ALBERTA ROYALTY REVIEW

    Bellamont has reviewed the impact of the changes recently announced in
the Alberta Royalty structure. The impact on Bellamont's existing and
production base is negligible.
    Based on the Corporation's southeast Saskatchewan Farm-in opportunity,
Bellamont has the ability to direct capital expenditures to projects outside
of Alberta where the royalty structures present more favorable economics. All
of the prospective formations in the southeast Saskatchewan farm-in lands are
light oil prone (35-37 degrees API) and as such, would be eligible for the
Saskatchewan Crown royalty holiday for deep vertical oil wells.

    OUTLOOK

    Bellamont is well positioned to execute its business plan into 2008. The
Corporation maintains a strong balance sheet with a current working capital
surplus of $3.3 million and an undrawn line of credit of $3.5 million. The
Corporation expects production to exceed 400 boed once the discovery well in
Central Alberta is tied in, with further increases possible with the removal
of production restrictions in Whitelaw.
    Bellamont has a balanced risk/reward prospect inventory of over 40 net
locations on company owned lands in addition to 12 seismically defined
drilling leads in southeast Saskatchewan relating to the Farm-in Agreement.
    Bellamont has been reviewing multiple acquisition and merger
opportunities and will continue to do so. In undertaking any acquisitions,
Bellamont will strive to maintain its strong balance sheet. We will continue
to focus on transactions that offer growth potential and are accretive on a
per share basis on cash flow, production and reserves.

    Bellamont is an emerging oil and gas company focused on the acquisition,
exploration, development and production of oil and natural gas in western
Canada and trades on the TSX Venture Exchange under the symbols "BMX.A" and
"BMX.B". The Corporation presently has 25,770,532 Class A shares and
1,012,000 Class B shares outstanding.

    This document contains forward-looking statements. More particularly,
this document contains statements concerning the Corporation's future
production levels and planned exploration, development and acquisition
activities.
    The forward-looking statements are based on certain key expectations and
assumptions made by Bellamont, including expectations and assumptions
concerning prevailing commodity prices and exchange rates, availability and
cost of labour and services, the timing of receipt of regulatory approvals,
the performance of existing wells, the success obtained in drilling new wells,
the performance of new wells and the sufficiency of budgeted capital
expenditures in carrying out the Corporation's planned activities.
    Although Bellamont believes that the expectations and assumptions on
which the forward-looking statements are based are reasonable, undue reliance
should not be placed on the forward-looking statements because Bellamont can
give no assurance that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results could differ
materially from those currently anticipated due to a number of factors and
risks. These include, but are not limited to, the risks associated with the
oil and gas industry in general (e.g., operational risks in development,
exploration and production; delays or changes in plans with respect to
exploration or development projects or capital expenditures; the uncertainty
of reserve estimates; the uncertainty of estimates and projections relating to
production, costs and expenses, and health, safety and environmental risks),
commodity price and exchange rate fluctuations and uncertainties resulting
from potential delays or changes in plans with respect to exploration or
development projects or capital expenditures. These risks are set out in more
detail in the Corporation's Annual Information Form which has been filed on
SEDAR and can be accessed at www.sedar.com.
    The forward-looking statements contained in this press release are made
as of the date hereof and Bellamont 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 securities laws.
    Boe means barrel of oil equivalent on the basis of 1 boe to
6,000 cubic feet of natural gas. Boe's may be misleading, particularly if used
in isolation. A boe conversion ratio of 1 boe for 6,000 cubic feet of natural
gas is based on an energy equivalent conversion method primarily applicable at
the burner tip and does not represent a value equivalency at the wellhead.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.

    %SEDAR: 00024373E




For further information:

For further information: Bellamont Exploration Ltd., Suite 200, 1324 -
17th Avenue S.W., Calgary, Alberta, T2T 5S8, Telephone: (403) 802-6840, Fax:
(403) 802-1315; Steve Moran, President and Chief Executive Officer, or Danny
Geremia, Vice President Finance and Chief Financial Officer;
www.bellamont.com

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