OilVoice - ReoStar Energy Announces First Quarter Fiscal Year 2009 Financial Results

ReoStar Energy Announces First Quarter Fiscal Year 2009 Financial Results

19 August 2008

ReoStar Energy Corp. has announced results of operations for the First Quarter Fiscal Year 2009, ended June 30, 2008.

Highlights of the Fiscal 2009 First Quarter

- Oil and Gas revenues increased 338% to $2.7 million versus $813 thousand for the previous first quarter
- Oil Production increases 215% to 14,630 barrels versus 6,830 for the previous first quarter
- Natural gas production increases 164% to 109,755 mcf versus 66,815 for the previous first quarter

First Quarter Fiscal Year 2009 Financial Review and Production Summary

Oil and gas revenues for the first quarter fiscal year 2009 were $2,752,747, compared with $813,924 for the first quarter of the previous year, an increase of 338%. Total costs and expenses increased approximately 46% to $1.7 million, and operating income was $1.2 million compared to a loss of $325 thousand for the first quarter of the previous year. Total operating costs and expenses increased primarily due to the increased number of producing wells and higher retained working interest per well.

During the first quarter ended June 30, 2008, ReoStar sold approximately 14,630 barrels of oil compared with 6,830 barrels of oil for the quarter ended June 30, 2007, an increase of approximately 215%. The average price for oil sold during the quarter ended June 30, 2008 was $123.01 per barrel compared the average price for the quarter ended June 30, 2007 of $61.06 per barrel.

ReoStar sold approximately 109,755 mcf of gas for the quarter ended June 30, 2008 compared with 66,815 mcf of gas for the quarter ended June 30, 2007, an increase of approximately 164%. The average price for natural gas sold during the quarter ended June 30, 2008 was $8.68 per mcf (net of transportation, compression and CO2 charges) compared with $5.94 per mcf for the quarter ended June 30, 2007.

Mark Zouvas, CEO of ReoStar, stated, "We are very pleased with our operational and financial performance during the first quarter. Our Barnett Shale properties continue to deliver positive returns on our investment and remain the focal point for generating cash flow for expanding our operations."