Nordic Oil and Gas Announces Third Quarter and Nine-Months Financial Results for 2011

WINNIPEG, Nov. 29, 2011 /CNW/ - Donald Benson, Chairman and Chief Executive Officer of Nordic Oil and Gas Ltd. ("Nordic" or "the Company") today announced the Company's financial results from operations for the three-months and nine-month period ended September 30, 2011. All amounts referenced herein are in Canadian dollars.

Revenue from oil and natural gas sales (including liquids and transport revenue) during the third quarter of 2011 totaled $271,310 up from the $182,225 reported during the third quarter of 2010. When adding interest, total revenue for the third quarter this year was $272,397 versus $182,715 for the same period a year ago.

The primary reason for the increase in revenue for the quarter was the fact that the Company has a working interest in 16 heavy oil wells at Lloydminster and nine natural gas and CBM wells in Joffre - up substantially from last year.

On a year-to-date basis, production revenue for the nine months ended September 30, 2011 totaled $811,302, as opposed to $520,110 for the same period in 2010, an increase of nearly 56%. When adding interest income, revenue for the first nine months of 2011 totaled $814,465, an increase of some $290,425 when compared to the 2010 total of $523,740.The revenue increase for the year-to-date is due to the fact that last year the Company's heavy oil wells at Lloydminster were shut-in during February, March and much of April, thereby significantly depleting revenue for the first and second quarters of 2010 from that area.

Total assets, including cash, short-term investments, accounts receivable, property and equipment and other assets (deposits), for the period ended September 30, 2011 were $13,829,491, up slightly from $13,527,126 at September 30, 2010, and up from the December 31, 2010 total of $13,538,405. The primary reason for the increase in assets was the increase recorded in the petroleum and natural gas properties and equipment, which was $5,554,459 at the end of September 2011, compared to $5,071,873 as at December 31, 2010.

Total liabilities for the period ended September 30, 2011 were $6,367,661, up approximately $965,000 from the $5,402,800 reported at December 31, 2010, and down approximately $1.7 million from the $8,091,322 reported as of January 1, 2010. The primary reasons for the increase year to date are the increase in deferred taxes to $1,438,133 from the $1,272,032 as of December 31, 2010, the rise in convertible debentures to $932,797 compared to $310,448 as at December 31, 2010, and the increase in asset retirement obligation to $855,225 from $721,919.

The net comprehensive loss for the three months ended September 30, 2011 before income taxes was ($236,008), compared to a loss of ($2,071,650) recorded during the same period a year ago. When applying the deferred taxes of ($11,094) for the period, the loss becomes ($224,914). Year to date, the net comprehensive loss before taxes was ($1,357,487) versus a loss of ($2,923,971) for the first nine months of 2010. When applying deferred taxes, the year to date loss for 2011 was ($1,523,588), compared to a loss of ($2,589,009) for the first nine months of 2010.

The decrease in the Q3 2011 loss and the year-to-date loss can be attributed to a reduction in General & Administrative expenses, both for the quarter under review and the year to date; and, the fact that there was no loss of disposition of capital in 2011, which was not the case in 2010.

Overall expenses for the quarter ended September 30, 2011 totaled $382,045 down approximately $258,000 from the 2010 third quarter total of $640,135. Production and operating expenses were down slightly when compared to the third quarter of 2010: $138,503 this year compared to $149,296 for the third quarter of 2010. The main reason for the drop in expenses this quarter was the decrease in depletion, amortization & impairment to $48,643 from $147,143 during the third quarter of 2010, and, the significant drop in general & administrative cost to $120,380 versus $323,605 during the same period last year.

On a year-to-date basis, overall expenses for the first nine months of 2011 totaled $1,836,558, up from the $1,621,002 for the same period last year. The primary reason for the increase for the year to date was the increase in depletion, amortization and impairment costs to $615,229 in 2011 versus $308,237. As noted previously, this resulted from an asset impairment charge of $464,583 with regard to the Company's Talbot Lake property.

International Financial Reporting Standards ("IFRS")

On January 1, 2011, the company adopted International Financial Reporting Standards ("IFRS") for financial reporting purposes, using a transition date of January 1, 2010. The financial statements for the three months ended March 31, 2011, including required comparative information, have been prepared in accordance with International Financial Reporting Standards 1, First-time Adoption of International Financial Reporting Standards, and with International Accounting Standard ("IAS") 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB"). Previously, the company prepared its interim and annual consolidated financial statements in accordance with Canadian generally accepted accounting principles ("previous GAAP"). Canadian GAAP now comprises IFRS.

These interim consolidated financial statements have been prepared in accordance with IFRS applicable to the preparation of interim financial statements, including IAS 34 and IFRS 1. Subject to certain transition elections disclosed in Note 2, the Company has consistently applied the same accounting policies in its opening IFRS statement of financial position at January 1, 2010 and throughout all periods presented, as if these policies had always been in effect. Note 2 discloses the impact of the transition to IFRS on the Company's reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in the Company's consolidated financial statements for the three months ended March 31, 2010 and the year ended December 31, 2010. Comparative figures for 2010 in these financial statements have been restated to give effect to these changes.

The policies applied in these interim consolidated financial statements are based on IFRS issued and outstanding when the Board of Directors approved the statements. Any subsequent changes to IFRS that are given effect in the Company's annual consolidated financial statements for the year ending December 31, 2011 could result in restatement of these interim consolidated financial statements, including the transition adjustments recognized on change-over to IFRS. The consolidated financial statements were authorized by the Board of Directors on June 30, 2011.

The general principle under IFRS 1 is that an entity must prepare its IFRS compliant financial statements as if the entity had always been applying IFRS (i.e. retrospective application). IFRS 1 does however provide mandatory exceptions and optional exemptions that require or allow first-time adopters to deviate from the retrospective application of IFRS.

About Nordic Oil and Gas Ltd.

Nordic Oil and Gas Ltd. is a junior oil and gas company engaged in the exploration and development of oil, natural gas and Coal Bed Methane in Alberta and Saskatchewan. The Corporation is listed on the TSX Venture Exchange and trades under the symbol NOG. Nordic was one of the "2008 TSX Venture 50" companies, a ranking of the top 10 public venture capital companies in five industry sectors listed on the TSX Venture Exchange.

Neither the 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 the contents of this News Release.

This press release contains forward-looking statements with respect to Nordic Oil and Gas Ltd. properties, and matters concerning the business, operations, strategy, and financial performance of Nordic. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the estimates and projections regarding the properties are realized. Forward-looking statements are based on a number of assumptions which may prove to be incorrect. Unless otherwise stated, all forward looking statements speak only as of the date of this press release and Nordic does not undertake any obligation to update such statements except as required by law.

SOURCE Nordic Oil

For further information:

Don Bain, Corporate Secretary.
Nordic Oil and Gas Ltd.
Tel. 204-229-7751
Fax: 204-943-1829
E-mail: donbain1@mts.net
www.nordicoilandgas.com

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