OilVoice - Stream Oil & Gas Announces Operations Update and Q2 Results

Stream Oil & Gas Announces Operations Update and Q2 Results

Friday, August 07, 2009

Stream Oil & Gas Ltd. provides the following operations update and summary of financial results for its second quarter ended May 31, 2009:

Operations Update
• Current average gross crude oil production is 470 bopd, 240 bopd net to Stream. Most of this production is sold to a local customer who pays in advance. Current average oil price received is about $40.00/bbl. Gas production is currently zero since the local refinery, Stream’s only current gas consumer, has temporarily suspended operations due to maintenance and upgrades. Jointly with Albpetrol, the Company’s gas customer, Stream continues to explore mitigation measures for this ongoing outage, while developing alternate gas utilization strategies.
• Due to the recent Albanian election, the Company has not yet finalized a resolution to the outstanding accounts receivable and royalty tax amendments to sales contracts with Albpetrol Sh.A and the ARMO refinery.
• The development plans for the Company’s three oil fields are due September 9th 2009 and the Company is on track to file these by the deadline.
• Albpetrol has agreed to Stream’s request for an extension of the evaluation and exploration phases of the Delvina (gas field) Petroleum Agreements to six and twelve months respectively. The extensions are subject to AKBN confirmation, expected shortly.
• The Company has engaged an independent petroleum engineering firm in Calgary to prepare a reserve valuation report in accordance with National Instrument 51-101 requirements. The Company expects that the report will be completed by the end of 2009.
• Stream has met all property expenditure requirements under its Petroleum Agreements and has deferred any significant capital expenditures pending fund-raising.

Management Changes
Under a revised agreement with Exergy Resources Inc., effective June 22, 2009, Wayne Arnold has been appointed Head of Stream’s Oil Division. Mr. Arnold will be responsible for generating the oil fields’ development plans, providing technical guidance to operations and rationalizing improved recovery strategies. Mr Arnold brings extensive oilfield development and well intervention/servicing expertise. In accordance with the revised agreement, the Company granted stock options to Exergy Eams Inc. to purchase up to 490,000 common shares of the Company at $0.24 per share for three years, subject to an 18 month vesting schedule in accordance with the Company’s stock option plan.

Effective July 29, 2009, the Consulting Agreement with BA Capital Inc. has been terminated.