News

Nov 14, 2007 - 17:46 ET Antrim Energy Inc. Announces 2007 Third Quarter Financial and Operational Results

CALGARY, ALBERTA--(Marketwire - Nov. 14, 2007) - 

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE U.S.

Antrim Energy Inc. (TSX:AEN) (AIM:AEY) ("Antrim") today reported its financial and operational results for the three and nine month periods ended September 30, 2007.

HIGHLIGHTS:

- Successful drilling results from 2007 UK Causeway drilling program

- Contracted rig to appraise UK North Sea Fyne field

- Drilling successes on Tierra del Fuego and Medianera licences in Argentina

- 47% increase in production over the comparable period in 2006

In the third quarter, Antrim successfully completed its planned three well Causeway drilling program on schedule and under budget. Cost savings on the initial program allowed Antrim to add a fourth well to the drilling program, accelerating Antrim's development of the Causeway property. The 2007 Causeway drilling program is now complete, with plans underway for submission of a Field Development Plan in the first quarter of 2008.

Other planned drilling activity in the UK North Sea remains on schedule. Drilling of the non-operated Kerloch prospect, on Block 211/22a North West, is scheduled to commence later this month. Following the acquisition of 3D seismic over the Fyne and Dandy oil fields in June 2007, Antrim has signed a drilling rig contract for a well to be drilled on the Fyne field early in the first quarter of 2008.

In Argentina, drilling has recommenced on the Tierra del Fuego licences. At least two years of additional drilling is planned on the licences following the Company's successful 2006 drilling program and acquisition of new 3D seismic completed in the first quarter of 2007. Initial drilling results show success on both the Tierra del Fuego and Medianera licences.

Cash flow from operations, excluding foreign exchange losses primarily attributed to deposits established for drilling operations in the UK North Sea, increased in the nine months ended September 30, 2007 to $4.6 million from $3.8 million in 2006 on higher oil and gas production in Argentina.



Financial and Operating Results
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
----------------------------------------------------------------------------
Financial Results ($000's except per
share amounts)
Revenue 3,182 3,862 10,129 9,470
Cash flow from operations 458 1,650 (519) 3,132
Cash flow from operations per share 0.00 0.02 (0.01) 0.05
Net income (loss) (2,365) 644 (7,294) 2,100
Net income (loss) per share - basic (0.02) 0.01 (0.07) 0.03
Working capital 48,553 16,267 48,553 16,267
Expenditures on petroleum and natural
gas properties 57,390 23,600 85,951 47,482
Debt - - - -
Common Shares Outstanding (000's)
End of period 107,882 71,736 107,882 71,736
Weighted average - basic 107,765 70,685 99,494 63,049
Weighted average - fully diluted 109,967 78,828 101,696 72,619
Operating Results
Wellhead price ($/boe) 23.58 30.76 24.50 33.15
Royalties ($/boe) (3.42) (3.81) (3.53) (4.19)
Operating expenses ($/boe) (9.16) (8.33) (7.42) (9.41)
--------------------------------------
Netback ($/boe) 11.00 18.62 13.55 19.55
--------------------------------------
--------------------------------------
Production
Oil, natural gas and NGL production
(boe) 141,331 122,394 420,896 285,701
Oil , natural gas and NGL production
(boe per day)(1) 1,536 1,330 1,542 1,047

(1)The boe conversion ratio of 6 mcf:1 bbl is based on an energy equivalency
conversion method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead.

 


Net production to Antrim in the first three quarters of 2007 was 1,542 boepd compared to 1,047 boepd for the comparable period in 2006. Average net oil production in the three and nine month periods ended September 30, 2007 was 598 and 648 bopd, respectively, compared to 583 and 523 bopd, respectively, for the comparable periods in 2006. Oil prices, after export taxes in Tierra del Fuego, averaged in the three and nine month periods ended September 30, 2007 $46.43 and $43.74 per barrel, respectively, compared to $58.47 and $54.53 per barrel, respectively, for the comparable periods in 2006. Oil production from both the Puesto Guardian and Tierra del Fuego licences is sold with reference to the price of West Texas Intermediate ("WTI") crude oil less a quality discount. Domestic oil sales are subject to a mandated discount which increases as the price of WTI crude oil increases. Oil exports are subject to an export tax introduced in the fourth quarter of 2006 and passed into law in January 2007.

Antrim had cash flow from operations, excluding foreign exchange losses primarily related to drilling activity in the UK North Sea, of $4,621,041 ($0.05 per share) in the first three quarters of 2007 compared to $3,792,009 ($0.06 per share) for the comparable period in 2006. Cash outflow from operations, after foreign exchange losses, in the first three quarters of 2007 was $519,335 ($0.01 per share) compared to cash flow from operations of $3,132,473 ($0.05 per share) for the comparable period in 2006. Net loss in the first three quarters of 2007 was $7,293,700 ($0.07 per share) compared to a net income of $2,100,193 ($0.03 per share) for the comparable period in 2006. Net loss increased due to foreign exchange losses related to the Company's 2007 capital expenditure program and to a lesser degree increased general and administrative costs, stock based compensation expense and higher depletion costs.

At September 30, 2007, Antrim had working capital of $48,552,512 (December 31, 2006 - $55,391,981) including cash and restricted cash of $97,118,283 (December 31, 2006 - $53,714,443) and no debt. Restricted cash at September 30, 2007 of $46,876,586 relates to US dollar and Pound Sterling denominated standby letters of credit issued with respect to the Company's 2007 drilling program in the UK North Sea. Accounts payable and accrued liabilities increased to $54,246,648 at September 30, 2007 primarily as a result of the UK drilling program.

At September 30, 2007 the Company had completed its planned three well Causeway drilling program. Following cost savings on the initial drilling program, a fourth well, originally scheduled to be drilled in 2008 as part of a larger development program, was subsequently added to the 2007 drilling program to accelerate Antrim's development of the Causeway structure. To fund appraisal drilling in 2008 of Antrim's UK North Sea properties, Antrim announced in October 2007 an offering on a bought deal basis of 8,300,000 common shares at a price of $6.05 per common share for gross proceeds of $50,215,000. An over-allotment option was also granted to the underwriters to issue an additional 1,245,000 common shares at a price of $6.05 per share. The financing is expected to close on November 15, 2007.

OVERVIEW OF OPERATIONS

United Kingdom - Block 211/22a South East and Block 211/23d ("Causeway")

In May 2007, Antrim began drilling the first of three wells designed to evaluate the potential of the central Causeway fault compartment and appraise a previous discovery on the southwestern flank of the structure. A fourth well, originally scheduled to be drilled in 2008 as part of a larger development program, was subsequently added to the 2007 drilling program to accelerate Antrim's development of the Causeway structure.

In October 2007, Antrim announced the completion of the 2007 Causeway drilling program. In total, Antrim drilled five wells on the Causeway structure in 2006 and 2007. A summary of Antrim's 2006-2007 Causeway drilling program follows:



211/23d-17z: Tested 14,500 barrels of oil per day
("bopd") from the Tarbert and Ness
formations

211/22a-6: Tested 6,300 bopd from the Ness and
Etive formations

211/22a-7a: Not tested but similar rates are
expected to those measured in 22a-6
(6,000 - 7,000 bopd)

211/22a-8: Tested 1,180 bopd from the Ness
formation

211/22a-9: Pressure support well for central
Causeway producers

 


Other wells on the Causeway structure have tested 8,100 bopd (suspended in 1992) and 5,500 bopd (abandoned in 1984). Cumulative test rates from the structure now exceed 35,000 bopd with an expected additional 6,000 - 7,000 bopd from the untested 22a-7a well. Antrim has operatorship and a 65.5% working interest in the Causeway Blocks 211/22a South East and 211/23d.

Antrim intends to submit a Field Development Plan ("FDP") to the Department of Business Enterprise and Regulatory Reform in the first quarter of 2008. Further Causeway development drilling is planned for 2008 to include at least one additional producer and a further two pressure support wells. Facility construction is also planned for 2008 on approval of the FDP.

United Kingdom - Block 211/22a North West ("Kerloch")

In November 2007, Antrim plans to participate in drilling the non-operated Kerloch prospect in Block 211/22a North West. The well will target the oil prone Jurassic Brent Sandstones adjacent to the Cormorant oil field and related infrastructure. The proposed location is approximately 10 km northwest of the Causeway 211/23d-17z well drilled by Antrim in mid-2006. Antrim holds a 21% working interest in Block 211/22a North West.

United Kingdom - Block 21/28a ("Fyne and Dandy")

On October 31, 2007, Antrim announced that it had signed a drilling rig contract for a well to be drilled on the Fyne field early in the first quarter of 2008. Antrim acquired a 75% working interest in Block 21/28a in the Central North Sea in November 2006. The block contains the undeveloped Fyne and Dandy oil fields, which have been delineated with eight wells drilled from 1971 to 1998. Antrim is operator of the licence and in June 2007 completed the acquisition of 70 km2 3D seismic. The cost of the licence acquisition in 2006 was US$8 million. Antrim has agreed to pay the seller an additional US$10 million on approval of a FDP.

United Kingdom - Other Developments

Antrim and its joint venture partners have relinquished their interests in Blocks 42/21 and 42/22 in the United Kingdom Southern Gas Basin based on a technical evaluation by the joint venture ownership group. Antrim held a 17.5% working interest in the two blocks.

Argentina - Tierra del Fuego

In September 2007, Antrim announced the start of its planned two-year drilling program in Tierra del Fuego. The initial phase of the drilling program, backed by a two-year drilling contract, is focusing on the Los Patos field. Nine drilling locations have already been built and the construction of additional locations continues.

To date, three wells have been drilled on the concessions confirming the extension of the Los Patos oil pool discovered in the 2006 drilling program. The first two wells, completed in September and October 2007, encountered net oil pay in the Springhill formation of 10 and 11 metres, respectively. Production rates up to 600 bopd were recorded during swab testing with stabilized rates at between 50 and 75 bopd. Fracture stimulation of the wells is planned. Logging of the third well, drilled in early November, is currently underway, to be followed by production testing.

An expansion of gas processing facilities and installation of a pipeline that will connect the Las Violetas licence to the San Martin pipeline is in progress. The expansion of gas processing facilities, including the installation of new dehydration and refrigeration equipment, is projected to be fully operational by December 2007. Completion of this work is expected to increase gross gas processing capacity to 33 million cubic feet per day (mmcf/d). Construction of a new pipeline and subsequent tie-in to the San Martin pipeline is expected to be completed by the end of the first quarter of 2008 at which time gross gas processing capacity is expected to increase to approximately 40 mmcf/d. Additional compression facilities required for the pipeline are also under construction. Antrim's working interest in the Tierra del Fuego licences is 25.78%.

Net production to Antrim from the Tierra del Fuego licences in the first three quarters of 2007 was 1,218 barrels of oil equivalent per day (boepd) compared to 701 boepd for the comparable period in 2006. Net oil production in the first three quarters of 2007 was 324 bopd compared to 185 bopd for the comparable period in 2006. Gas and natural gas liquids ("NGL") production in the first three quarters of 2007 was 5.0 mmcf/d and 67 barrels per day, respectively. Gas and NGL production for the comparable periods in 2006 was 2.8 mmcf/d and 50 barrels per day, respectively.

Argentina - Medianera and Tres Nidos Sur

In August 2007, Antrim announced initial results from two wells drilled in May and June, 2007 on the Medianera licence. Pressure measurements indicate a new field discovery in the northern portion of the block. The M-3001 well was perforated in the upper Quintuco zone and swab tested 93 bopd with 30 barrels of water per day from 12 metres of net pay. An additional 5 metres of net pay was encountered in the Lower Quintuco formation, which tested gas at rates up to 3 mmcf/d. Additional completion work is planned at M-3001 to isolate the water-bearing zone.

The second well, M-3002, encountered 14 metres of net oil pay in virgin pressure reservoir in the Upper and Lower Quintuco formation. Following completion and fracture stimulation in October, M-3002 is producing 90 bopd with a watercut of 10%.

Antrim has a 70.0% working interest in the Medianera licence. Net production to Antrim from the Medianera licence in the first three quarters of 2007 was 31 bopd.

In October 2007, Antrim announced that it had been awarded an exploration licence for the Tres Nidos Sur block immediately adjacent to and north of the Medianera licence. The acquisition of this licence (Antrim 70%) will allow the Company to extend the geological trend proven successful by the recent M-3001 and M-3002 wells on the Medianera licence.

Argentina - North West Basin

In October 2007, drilling commenced on the first of two exploratory wells on the Capricorn licence in northern Argentina. The wells are expected to be drilled back-to-back in the fourth quarter. Antrim has a 50% working interest in the licence, subject to the terms of a farm-out agreement entered into in October 2006 with respect to a portion of its interest in the licence. Under the agreement, Antrim will retain a 37.5% working interest in the wells by paying 25% of the drilling costs.

In 2006, 330 km2 of 3D seismic was acquired over the Puesto Guardian licence in northern Argentina. The new seismic has been processed and interpretative work is in progress. Antrim intends to use the newly acquired seismic to support a drilling program in 2008, subject to rig availability. Antrim has a 40% working interest in the Puesto Guardian licence.

Net production to Antrim from the Puesto Guardian licence in the first three quarters of 2007 was 293 bopd compared to 328 bopd for the comparable period in 2006.

Argentina - Other Developments

Effective October 17, 2007, the Argentina government announced an approximately eight-fold increase in the annual land rental or "canon" payable on exploitation and exploration licences. It is anticipated that after relinquishment of a portion of Antrim's exploitation acreage, the annual rental on exploitation licences will increase from approximately $100,000 per annum to approximately $700,000 per annum. With respect to exploration acreage, after taking into account current drilling activity on the Capricorn licence and the relinquishment of approximately 75% of the licence, management believes that the increased rental cost to Antrim in 2007 will be approximately $100,000. Should drilling be unsuccessful, Antrim would relinquish its remaining interest in the Capricorn licence to avoid any further rental costs in 2008.

Antrim's 2007 third quarter financial statements and related MD&A are available on Antrim's website at www.antrimenergy.com as well as on the SEDAR website at www.sedar.com.

About Antrim

Antrim Energy Inc. is an international oil and gas exploration and production company headquartered in Calgary, Alberta, Canada. Antrim's objective is to create significant wealth for its shareholders through the discovery, production and sale of oil and gas. Antrim's production and exploration operations are centered in Argentina and its high impact oil and gas exploration is focused in the United Kingdom. Antrim is listed on the Toronto Stock Exchange (AEN) and on the London Stock Exchange's Alternative Investment Market (AEY). Visit www.antrimenergy.com for more information.

Forward-Looking Statements

This news release contains certain forward-looking statements, which include assumptions with respect to future plans, results and capital expenditures. Cumulative volumes are not necessarily representative of future production volumes. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond Antrim's control. Please refer to Antrim's Annual Information Form for the year ended December 31, 2006 and dated March 30, 2007 and available for viewing at www.sedar.com, for a list of risk factors. Antrim's actual results could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Antrim will derive therefrom. All subsequent forward-looking statements, whether written or oral, attributable to Antrim or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release.

Qualified Person Review

In accordance with AIM guidelines, Mr. Terry Lederhouse, P. Eng and Commercial Manager of Antrim, is the qualified person that has reviewed the technical information contained in this news release.



Antrim Energy Inc.
Consolidated Balance Sheets
As at September 30, 2007 and December 31, 2006
(unaudited)
----------------------------------------------------------------------------

2007 2006
Cdn $ Cdn $
-------------------------
Assets
Current assets
Cash and cash equivalents 50,241,697 53,714,443
Restricted cash (note 3) 46,876,586 -
Accounts receivable 4,749,115 4,111,105
Inventory and prepaid expenses 931,762 498,298
Other current assets - 577,367
-------------------------
102,799,160 58,901,213

Petroleum and natural gas properties (note 4) 166,296,866 82,084,916
Office equipment 547,906 252,693
Future income taxes 318,973 263,263
Other non-current assets (note 5) 4,357,758 3,649,215
-------------------------

Total Assets 274,320,663 145,151,300
-------------------------
-------------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities 54,246,648 3,207,383
Income taxes payable - 301,849
-------------------------
54,246,648 3,509,232

Asset retirement obligation 4,571,829 2,308,327
-------------------------
58,818,477 5,817,559
Commitments and contingencies (note 9)

Shareholders' Equity

Share capital (note 6) 234,496,498 153,176,930
Contributed surplus 6,491,992 4,349,415
Deficit (25,486,304) (18,192,604)
-------------------------

215,502,186 139,333,741
-------------------------

Total Liabilities and Shareholders' Equity 274,320,663 145,151,300
-------------------------
-------------------------


Antrim Energy Inc.
Consolidated Statements of Income (Loss), Comprehensive Income (Loss) and
Deficit
For the periods ended September 30, 2007 and 2006 (unaudited)
----------------------------------------------------------------------------

Three months Ended Nine months Ended
September 30, September 30,
2007 2006 2007 2006
Cdn $ Cdn $ Cdn $ Cdn $
------------ ------------ ------------ ------------


Revenue
Oil and gas sales 3,182,205 3,862,264 10,129,042 9,469,772
Royalties (461,127) (466,134) (1,460,686) (1,197,002)
------------ ------------ ------------ ------------

2,721,078 3,396,130 8,668,356 8,272,770
Interest and other
income 1,245,161 268,879 3,190,973 857,814
Gain on sale of
petroleum
and natural gas
properties - - - 1,466,864
------------ ------------ ------------ ------------

3,966,239 3,665,009 11,859,329 10,597,448
------------ ------------ ------------ ------------

Expenses
Operating 1,236,912 1,019,469 3,067,372 2,688,678
General and
administrative 1,204,476 820,199 4,046,550 2,334,369
Stock-based compensation 970,072 335,516 2,726,693 902,049
Depletion and
depreciation 1,133,120 643,481 3,260,770 1,540,923
Accretion of asset
retirement
obligations 82,920 41,538 187,920 65,669
Foreign exchange loss 1,035,716 173,473 5,140,376 659,536
Write-off of petroleum
and natural gas
properties 654,691 - 654,691 -
------------ ------------ ------------ ------------

6,317,907 3,033,676 19,084,372 8,191,224
------------ ------------ ------------ ------------

Income (loss) for the
period before
income taxes (2,351,668) 631,333 (7,225,043) 2,406,224
Income tax expense
(recovery)
Current 31,396 1,644 124,366 315,528
Future (18,035) (14,537) (55,709) (9,497)
------------ ------------ ------------ ------------

13,361 (12,893) 68,657 306,031
------------ ------------ ------------ ------------

Net Income (Loss) and
Comprehensive
Income (Loss) (2,365,029) 644,226 (7,293,700) 2,100,193
Deficit - Beginning of
Period (23,121,275) (18,078,653)(18,192,604) (19,534,620)
------------ ------------ ------------ ------------

Deficit - End of
Period (25,486,304) (17,434,427)(25,486,304) (17,434,427)
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------

Net Income (Loss) Per
Common Share - Basic (0.02) 0.01 (0.07) 0.03
Net Income (Loss) Per
Common Share - Diluted (0.02) 0.01 (0.07) 0.03


Antrim Energy Inc.
Consolidated Statements of Cash Flows
For the periods ended September 30, 2007 and 2006 (unaudited)
---------------------------------------------------------------------------

Three months Ended Nine months Ended
September 30, September 30,
2007 2006 2007 2006
Cdn $ Cdn $ Cdn $ Cdn $
------------ ------------ ------------ ------------
Operating Activities
Net income (loss) for
the period (2,365,029) 644,226 (7,293,700) 2,100,193
Items not involving
cash:
Gain on sale of
petroleum and
natural gas
properties - - - (1,466,864)
Depletion and
depreciation 1,133,120 643,481 3,260,770 1,540,923
Write-off of
petroleum and
natural gas
properties (note 4) 654,691 - 654,691 -
Accretion of asset
retirement
obligations 82,920 41,538 187,920 65,669
Stock based
compensation
expense 970,072 335,516 2,726,693 902,049
Future income taxes (18,035) (14,537) (55,709) (9,497)
------------ ------------ ------------ ------------

457,739 1,650,224 (519,335) 3,132,473
Change in non-cash
working capital
items (3,142,355) (3,056,608) (2,451,715) 591,935
------------ ------------ ------------ ------------
(2,684,616) (1,406,384) (2,971,050) 3,724,408
------------ ------------ ------------ ------------
Financing Activities
Issue of common
shares 418,550 3,263,067 83,549,567 32,401,314
Share issue expenses (45,883) - (2,898,880) (1,845,759)
------------ ------------ ------------ ------------
372,667 3,263,067 80,650,687 30,555,555
------------ ------------ ------------ ------------
Investing Activities
Office equipment (227,859) (40,739) (395,983) (86,084)
Petroleum and natural
gas properties (57,389,888) (23,599,859)(85,951,059) (47,482,033)
Proceeds on sale of
petroleum
and natural gas
properties - - - 1,300,801
Restricted cash 1,576,133 28,704,807 (46,876,586) -
Other current assets 72,430 119,106 577,367 509,509
Other non-current
assets (395,462) (67,441) (708,543) (1,197,332)
Change in non-cash
working capital items 14,589,508 (21,395,007) 52,202,421 (3,611,659)
------------ ------------ ------------ ------------
(41,775,138) (16,279,133)(81,152,383) (50,566,798)
------------ ------------ ------------ ------------
Net increase
(decrease) in cash
and cash
equivalents (44,087,087) (14,422,450) (3,472,746) (16,286,835)
Cash and Cash
Equivalents
Beginning of
Period 94,328,784 31,345,093 53,714,443 33,209,478
------------ ------------ ------------ ------------
Cash and Cash
Equivalents - End
of Period 50,241,697 16,922,643 50,241,697 16,922,643
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Supplemental Cash
Flow Information
Interest received 2,298,636 213,300 2,873,439 763,727
Taxes paid 254,925 177,987 426,215 177,987

 


FOR FURTHER INFORMATION PLEASE CONTACT:

Antrim Energy Inc.
Stephen Greer
President & CEO
(403) 264-5111
(403) 264-5113 (FAX)
Email: greer@antrimenergy.com

or

Antrim Energy Inc.
Anthony J. Potter
Chief Financial Officer
(403) 264-5111
(403) 264-5113 (FAX)
Email: potter@antrimenergy.com
Website: www.antrimenergy.com