Antrim Energy Inc.

Antrim Energy Inc.

May 15, 2006 19:22 ET

Antrim Energy Inc. Announces 2006 First Quarter Financial and Operational Results

CALGARY, ALBERTA--(CCNMatthews - May 15, 2006) - Antrim Energy Inc. ("Antrim") (TSX:AEN) (AIM:AEY) today reported its financial and operational results for the three month period ended March 31, 2006.

Highlights for the first three months include:

- 28% increase in revenues over the comparable period in 2005

- 457% increase in cash flow over the comparable period in 2005

- Successful multi-well drilling program in Tierra del Fuego, Argentina

- Acquisition of Medianera Block, Neuquen Basin, Argentina

- Obtained approval as UK Offshore Operator

- Secured drilling rig for UK North Sea Causeway prospect

- Completed $28 million financing

Antrim is pleased to report significant increases in revenue and cash flow over the comparable period in 2005. The Company continues its successful drilling program in Argentina with eight wells cased for testing or production and one well dry and abandoned. Operational activity in Argentina is expected to increase through 2006 with additional drilling in Tierra del Fuego and seismic acquisition and drilling on the recently acquired Medianera Block in Argentina's Neuquen Basin.

In the UK North Sea, Antrim is pleased to announce the contracting of a rig to drill the Company's Causeway Prospect, expected to start in early June, 2006.

Funds to finance the Company's increased level of activity are in place following a $28 million financing completed in May, 2006.

Financial and Operating Results

Three Months Ended
March 31,
Financial Results ($000's except per share amounts) 2006 2005
--------------------------------------------------- ------ -------
Revenue 2,841 2,222
Cash flow from operations 1,243 223
Cash flow from operations per share 0.02 0.01
Net income (loss) 546 (350)
Net income (loss) per share 0.01 (0.01)
Working capital 27,828 11,805
Capital expenditures 3,465 7,729
Debt - -

Common Shares Outstanding (000's)
End of period 54,957 39,481
Weighted average - basic 54,921 39,487
Weighted average - fully diluted 57,834 40,692

Operating Results
Wellhead price ($/BOE) 33.09 32.30
Royalties ($/BOE) (4.22) (4.18)
Operating expenses ($/BOE) (8.20) (7.86)
Netback ($/BOE) 20.67 20.26
Oil, natural gas and NGL production (BOE) 85,839 68,773
Oil, natural gas and NGL production (BOE per day)(1) 954 764

(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.

At March 31, 2006, Antrim had working capital of $27,828,257 (December 31, 2005 - $29,969,247) including cash of $27,981,608 (December 31, 2005 - $33,209,478) and no debt. Working capital decreased following the acquisition of the Medianera Block in February 2006 and capital expenditures associated with the Company's multi-well drilling program in Tierra del Fuego, Argentina. Antrim generated cash flow from operations in the three month period ended March 31, 2006 of $1,243,453 ($0.02 per share) compared to cash flow from operations of $223,091 ($0.01 per share) in the comparable period in 2005. Net income in the first three months of 2006 was $545,991 ($0.01 per share) compared to a net loss of $349,887 ($0.01 per share) in 2005. Net income increased due to higher revenues on increased oil, gas and NGL prices and increased production over the comparable period.


Argentina Activities

Argentina- NorthWest Basin

Net oil production from the Puesto Guardian field in Argentina's NorthWest Basin in the first three months of 2006 was 357 barrels of oil per day compared to 450 barrels of oil per day in the first three months of 2005. Despite the washout in January 2006 of a key river crossing, the majority of production in the quarter was delivered to a regional refinery.

In conjunction with its partners in the Puesto Guardian field and neighbouring Capricorn licence, Antrim plans to acquire additional 3-D seismic in June 2006 which would lead to the drilling of new wells to add further production and reserves from the region. Antrim has extended the Capricorn licence into a second term with the relinquishment of 50% of the acreage and the commitment to drill an exploration well on the licence in 2006-2007.

Argentina - Tierra del Fuego

On February 14, 2005, Antrim completed the acquisition of a 25.78% working interest in three producing exploitation concessions and related processing facilities in the Tierra del Fuego region in southern Argentina. The concessions produce light crude oil, natural gas and natural gas liquids ("NGLs"). Net oil production from the Tierra del Fuego concessions in the first three months of 2006 was 138 barrels of oil per day compared to 132 barrels of oil per day from February 14, 2005 to March 31, 2005. Gas and NGL production in the first three months of 2006 was 2,283 mcf per day and 56 barrels per day, respectively. Gas and NGL production from February 14, 2005 to March 31, 2005 was 2,410 mcf per day and 46 barrels per day, respectively.

In October 2005, Antrim commenced a successful multi-well drilling program on the concessions. The drilling program has tested very high rates of gas, NGL's and condensate none of which was on production in the quarter. Antrim and its partners have to date tested a cumulative 50.4 mmcf/d (Antrim net - 13.0 mmcf/d) wet gas from the drilling program. Due to the high rates encountered, additional compression, pipeline and processing facilities are being sourced to bring these wells onto production later in the year. In the interim drilling continues with an expected seven additional wells to be drilled in 2006.

Argentina - Medianera

On February 24, 2006, Antrim completed the acquisition of a 70% working interest in the producing Medianera Block in Rio Negro Province, Neuquen Basin, Argentina. The cost of the acquisition was approximately US$1.2 million after closing adjustments. The Medianera field was discovered in 1961 and the licence covers an area of 53 km2 (130,000 acres). It is located in central Argentina in the Neuquen Basin, Argentina's most prolific oil and gas basin. Oil production net to Antrim from February 24, 2006 to March 31, 2006 was 30 barrels of oil per day and was placed in storage in the period.

Antrim believes the Medianera block has significant exploitation and exploration potential, both uphole and from deeper horizons. No deep wells have been drilled on the block to date. Antrim intends to acquire 3D seismic over the entire block in the second and third quarter of 2006. The operator of Antrim's concessions in Tierra del Fuego, Argentina, has acquired the remaining 30% working interest in the block and will operate the block.

United Kingdom - Block 211/22a South East and Block 211/23d

Drilling operations on the Company's Causeway prospect are expected to begin in early June 2006. The Causeway prospect is on the prospective Osprey Ridge Trend which consists of a series of fault-bounded, staircase like structures extending northeast from Block 211/22 SE onto Block 211/23d. A lateral well is planned to intercept a number of fault blocks on the trend. A discovery well (211/22a-3) drilled in 1984 on Block 211/22a SE tested oil at 5,512 barrels of oil per day from a Jurassic reservoir. A discovery well (211/23b -11) drilled in 1992 on Block 211/23d tested oil at a rate of 8,100 bopd from the Jurassic Brent Interval. Antrim has a 79% working interest in the two blocks and is the operator.

United Kingdom - South Larne

In 2005, Antrim and its partners acquired additional seismic data on the licence to be used towards preparation and filing of an application to drill an exploration well on the licence. Examination of the gas storage potential of the licence also continues to be performed.

Antrim has also filed a Revised Annual Information Form, dated May 15, 2006, for the year ended December 31, 2005, which includes the following reports required under National Instrument 51-101 "Standards of Disclosure for Oil and Gas Activities": Form 51-101F1, Statement of Reserves Data and Other Oil and Gas Information; Form 51-101F2, Reports of Reserve Data by Independent Qualified Reserves Evaluators; and Form 51-101F3, Report of Management and Directors on Oil and Gas Disclosure. The Revised Annual Information Form can be found for viewing by electronic means on the System for Electronic Document Analysis and Retrieval at Form 51-101F3 identifies, in accordance with AIM 16 Guidance Note of the London Stock Exchange, the qualified persons within the Company responsible for Antrim's oil and gas disclosures included in the Revised Annual Information Form.

Certain statements contained in this press release may be considered as "forward looking". Such "forward looking" statements are subject to risks and uncertainties that could cause actual results to differ materially from estimated or implied results.

Copies of Antrim's 2006 first quarter financial statements and related MD&A are available on Antrim's website at as well as on the SEDAR website at

Antrim Energy Inc.
Consolidated Balance Sheets
As at March 31, 2006 and December 31, 2005 (unaudited)

2006 2005
$ $
Current assets
Cash and cash equivalents 27,981,608 33,209,478
Accounts receivable 2,925,628 2,208,801
Inventory 311,763 354,121
Other current assets 999,077 1,209,615
32,218,076 36,982,015

Petroleum and natural gas properties 26,096,506 22,950,936
Office equipment 99,421 103,547
Future income taxes - 14,537
Other non-current assets 184,370 175,986

Total Assets 58,598,373 60,227,021

Current liabilities
Accounts payable and accrued liabilities 4,378,568 6,981,538
Income taxes payable 11,251 31,230
4,389,819 7,012,768

Future income taxes 21,011 30,508

Asset retirement obligation 717,606 554,603
5,128,436 7,597,879

Shareholders' Equity

Share capital 69,403,228 70,046,407
Contributed surplus 3,055,338 2,117,355
Deficit (18,988,629) (19,534,620)

53,469,937 52,629,142

Total Liabilities and Shareholders' Equity 58,598,373 60,227,021

Antrim Energy Inc.
Consolidated Statements of Income (Loss) and Deficit
For the three months ended March 31, 2006 and 2005 (unaudited)

2006 2005
$ $
Oil and gas sales 2,840,821 2,221,684
Royalties (361,851) (287,334)

2,478,970 1,934,350

Interest and other income 312,970 69,256

2,791,940 2,003,606
Operating 704,276 540,767
General and administrative 647,631 786,755
Stock-based compensation 206,329 133,210
Depletion and depreciation 475,000 424,646
Accretion of asset retirement obligations 11,093 15,122
Foreign exchange loss 24,683 12,158


2,069,012 1,912,658
Income (loss) for the period before income
taxes 722,928 90,948

Income taxes
Current 171,897 440,835
Future 5,040 -

176,937 440,835

Net Income (Loss) for the Period 545,991 (349,887)
Deficit - Beginning of Period (19,534,620) (16,345,051)
Deficit - End of Period (18,988,629) (16,694,938)

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

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