CALGARY, Alberta, August 14, 2007, Gran Tierra Energy Inc. (OTCBB: GTRE.OB) a company focused on oil exploration and production in South America, today announced the financial results of operations for the second quarter ended June 30, 2007.
Total revenue for the quarter was $3.7 million as compared to $2.1 million for same quarter of 2006. Net loss for the quarter amounted to $5.1 million or $(0.05) per share as compared to a net loss of $0.6 million or $(0.01) per share for the comparable quarter of 2006.
For the six month period ended June 30, 2007 the company reported total revenue of $8.3 million as compared to $3.1 million for same period of 2006. Net loss for the period amounted to $11.7 million or $(0.12) per share as compared to a net loss of $1.8 million or $(0.04) per share for the comparable period of 2006.
Included in the year to date results are non-cash expenses of approximately $7.4 million in liquidated damages, recorded as $4.2 million and $3.2 million in the first and second quarters, respectively. The liquidated damages were potentially payable in cash to stockholders who purchased 50 million units in a 2006 financing, as a result of a delay in the registration statement for the units becoming effective. The registration of these shares became effective May 14, 2007 and stockholders holding a majority of the units approved a proposal whereby Gran Tierra amended the terms of the warrants associated with the financing in lieu of the company paying the liquidated damages in cash. As a result, no liquidated damages were payable. There was no comparable expense in the second quarter of 2006.
The company reported cash and cash equivalents of $9.8 million at the end of the second quarter of 2007 as compared to $24.1 million at December 31, 2006. Total working capital reported at the end of the quarter was $7.2 million as compared to $14.3 million at December 31, 2006 and Shareholders' equity was reported at $72.2 million as compared to $76.2 million at December 31, 2006. The company reported no outstanding long-term debt.
Commenting on the results of the quarter, Dana Coffield, President and Chief Executive Officer of Gran Tierra Energy Inc., stated, "The second quarter of 2007 continued Gran Tierra Energy's capital spending program which was dedicated to an aggressive exploration drilling campaign initiated in the first quarter of 2007. As a result of this capital investment, at the end of the second quarter of 2007, Gran Tierra had increased its proved oil reserves 197% to 5.9 million barrels of oil, and increased proved, probable and possible oil reserves 361% to 25.6 million barrels of oil (all net after royalty) compared to year-end 2006. This drilling campaign will continue through the balance of 2007 and into 2008, and will include the addition of development drilling programs along with continued exploration drilling."
The company reported oil and condensate production for the six month period ended June 30, 2007 of 1,140 barrels per day, net after royalty, as compared to 329 barrels per day, net after royalty, for the comparable period of 2006.
The company has working interests in 19 exploration and production contracts in Argentina, Colombia, and Peru, encompassing approximately 6.5 million acres of land. Gran Tierra Energy operates 18 of these blocks, bringing its net acreage position to approximately 5.8 million acres.
Conference Call Information:
Gran Tierra Energy Inc. will hold a conference call to review its second quarter results on Tuesday, August 14, 2007 at 11:00 a.m. Eastern. The call will be hosted by Dana Coffield, President and Chief Executive Officer. Interested parties may access the conference call by dialing (800) 599-9816 (domestic) or (617) 847-8705 (international), pass code # 64124577.
The call will also be available via web cast at www.grantierra.com, http://www.streetevents.com, http://www.fulldisclosure.com and will be available on the Gran Tierra website until the next earnings conference call
If you are unable to participate, an audio replay of the call will be available beginning two hours after the call and will be available until 11:59 p.m. on August 21, 2007, by dialing (888) 286-8010 (domestic) or (617) 801-6888 (international) using confirmation pass code 78933699. An audio replay of the call will also be available on Gran Tierra's web site, www.grantierra.com, until the next earnings call.
About Gran Tierra Energy Inc.
Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated and traded in the United States and operating in South America. The Company holds interests in producing and prospective properties in Argentina, Colombia and Peru. To date, the Company has pursued a strategy that focuses on establishing a portfolio of producing properties, development and exploration opportunities, through selective acquisitions, to provide a base for future growth. Additional information concerning Gran Tierra is available at www.grantierra.com. Investor inquiries may be directed to [email protected] or 1-800-916-GTRE (4873).
Forward Looking Statements
The statement in this press release regarding Gran Tierra Energy's expectation that its drilling campaign will continue through the balance of 2007 and into 2008, and will include the addition of development drilling programs along with continued exploration drilling, is a 'forward-looking statement' within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934. Although this forward-looking statement reflects the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in this forward-looking statement including, but not limited to, in the case of this forward-looking statement: unexpected delays in drilling due to equipment failure or other unforeseen reasons; unforeseen events, such as unexpected difficulties in drilling or unexpected discoveries, may cause Gran Tierra Energy to reallocate resources, which may delay drilling and production and/or alter the mix of development drilling and exploration drilling in Gran Tierra Energy's portfolio; and unexpected costs may decrease funds available to carry out drilling plans, which could delay or prevent production and/or development. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Gran Tierra Energy assumes no obligation to update these forward-looking statements to reflect any event or circumstance that may arise after the date of this release, other than as may be required by applicable law or regulation. Readers are urged to carefully review and consider the various disclosures, including the risk factors, made by Gran Tierra Energy in its reports filed with the Securities and Exchange Commission, in particular its quarterly report on Form 10-Q filed on May 15, 2007, which attempt to advise interested parties of the risks and factors that may affect Gran Tierra Energy's business. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, Gran Tierra Energy's actual results may vary materially from those expected or projected.
Financial Tables to Follow
|Gran Tierra Energy Inc. |
|Consolidated Statement of Operations and Accumulated Deficit (unaudited) |
|Stated in US dollars |
|Three Months Ended June 30, ||Six Months ended June 30, |
|2007 ||2006 ||2007 ||2006 |
|REVENUE AND OTHER INCOME |
|Oil sales||$ 3,623,671||$ 2,089,984||$ 7,899,720||$ 3,072,394|
|Natural gas sales||(12,633)||-||35,494||67,219|
|Interest and other||138,696||-||331,350||-|
|Depletion, depreciation and accretion||2,376,824||511,991||4,700,898||874,465|
|General and administrative||2,679,734||880,554||4,618,855||2,471,583|
|Derivative financial instruments||19,984||-||676,984||-|
|Foreign exchange loss||(238,386)||99,308||(6,134)||3,842|
|LOSS BEFORE INCOME TAX ||(6,248,377)||(491,409)||(13,196,968)||(1,652,897)|
|NET LOSS || $ (5,072,085) || $ (571,734) || $ (11,722,268) || $ (1,790,680) |
|ACCUMULATED DEFICIT, beginning of period||(14,693,567)||(3,438,628)||(8,043,384)||(2,219,680)|
|ACCUMULATED DEFICIT, end of period || $ (19,765,652) || $ (4,010,362) || $ (19,765,652) || $ (4,010,360) |
|NET LOSS PER COMMON SHARE - BASIC & DILUTED||(0.05)||(0.01)||(0.12)||(0.04)|
|Weighted average common shares outstanding - basic & diluted || 95,205,518 || 49,349,778 || 95,329,950 || 46,789,749 |
|Gran Tierra Energy Inc. |
|Consolidated Balance Sheet (Unaudited) |
|Stated in US dollars |
| || June 30, 2007 || December 31, 2006 |
|Cash and cash equivalents||$ 9,842,179||$ 24,100,780|
|Total Current Assets||20,304,749||33,374,336|
|Oil and gas properties, using the full cost method of accounting|
|Total Oil and Gas Properties||60,714,616||56,093,285|
|Total Property, Plant and Equipment||61,391,190||56,707,389|
|Long term assets|
|Deferred tax asset||496,147||444,324|
|Long term investment and other||1,567,282||379,678|
|Total Long Term Assets||17,068,512||15,829,085|
|Total Assets || $ 98,764,451 || $ 105,910,809 |
|LIABILITIES AND SHAREHOLDERS' EQUITY |
|Accounts payable||$ 6,665,489||$ 6,729,839|
|Current taxes payable||1,539,603||1,642,045|
|Total Current Liabilities||13,151,247||19,099,692|
|Long term liabilities||1,019,401||412,929|
|Deferred tax liability||11,373,307||9,875,657|
|Derivative financial instruments||676,984||-|
|Asset retirement obligation||340,618||327,752|
|Total Long Term Liabilities||13,410,310||10,616,338|
|(78,951,358 common shares and 15,555,554 exchangeable shares, par value $0.001 per share, issued and outstanding)|
|(2006 common and exchangeable shares respectively 78,789,104 and 16,666,661)|
|Additional paid in capital||70,853,039||71,311,155|
|Total Shareholders' Equity||72,202,894||76,194,779|
|Total Liabilities and Shareholders' Equity || $ 98,764,451 || $ 105,910,809 |