SOURCE: Tengasco, Inc.

November 09, 2007 08:42 ET

Tengasco Announces Third Quarter 2007 Financial Results

KNOXVILLE, TN--(Marketwire - November 9, 2007) - Tengasco, Inc. (AMEX: TGC) announced today its financial results for the quarter ended September 30, 2007. The Company realized net income attributable to common shareholders of $1,580,662 or $0.03 per share of common stock during the third quarter of 2007, compared to a net income to common shareholders of $519,094 or $0.01 per share of common stock in the third quarter of 2006. For the quarter ended September 30, 2007, the Company has recognized a deferred tax asset of $1.1 million to reflect its assessment that this asset was more likely than not to be realized based on current energy price conditions and current production levels. Accordingly, management recorded this deferred tax asset in the amount of $1.1 million in the third quarter of 2007 relating to value of net operating loss carryforwards.

The Company recognized $2,375,229 in total revenues from its Kansas and Tennessee properties during the third quarter of 2007 compared to $2,251,274 in the third quarter of 2006. The increase in revenues was primarily due to an increase in oil production in 2007 in Kansas which was offset by a decrease in gas sales in Tennessee. The Kansas net oil sales increase during this period was 4,584 barrels. The increase in revenues was also due to oil prices in the third quarter of 2007 which averaged $69.15 per barrel compared to $64.97 per barrel in the third quarter of 2006. Gross production of oil for the third quarter was a record 49,067 barrels in 2007 compared to the previous record third quarter production of 47,650 barrels in 2006.

The Company recognized $6,368,068 in total revenues from its Kansas and Tennessee properties during the first nine months of 2007 compared to $6,704,979 in the first nine months of 2006. The decrease in revenues was due to a decrease in oil prices in 2007 for this nine month period, which was partially offset by increased Kansas oil sales during this period of 7,939 barrels attributable to well workovers, polymer completion workovers and drilling. Oil prices in the first nine months of 2007 averaged $60.28 per barrel compared to $62.94 per barrel in the first nine months of 2006. During the first nine months of 2007, the Company sold 137,265 gross barrels of oil from its Kansas Properties comprised of 146 producing oil wells. Of the 137,265 gross barrels, 96,747 barrels were net to the Company after required payments to all of the Drilling Program participants and royalty interests. The Company's sales for the first nine months of 2007 of 96,747 net barrels of oil compares to 88,808 barrels sold to the Company's interest in the first nine months of 2006.

Jeffrey R. Bailey, Chief Executive Officer, said, "Our third quarter 2007 results show an increase in production volumes, but a lower oil price for the first nine months of 2007 versus the first nine months of 2006, and a decrease in Swan Creek gas sales offset that gain. We remain focused in Kansas where we seek to grow our oil production through the drill bit, partnerships and workovers. The fourth quarter oil prices have spiked to record highs, and in the fourth quarter we have drilled five wells under the drilling program with Hoactzin Partners, L.P. Four of these wells have been completed as producers and the fifth well, a wildcat well, was a dry hole. We continue to seek out acreage and Kansas/Mid-continent production for potential acquisition by the Company, but the premium prices demanded by the sellers have made these acquisitions more difficult to find. While our shareholders might be surprised that the industry has had lower average oil prices in 2007 versus 2006, the spike early in the fourth quarter 2007 and tight global supply appear poised to cause 2007 to end with record oil prices."

Forward-looking statements made in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements involve risk and uncertainties which may cause actual results to differ from anticipated results, including risks associated with the timing and development of the Company's reserves and projects as well as risks of downturns in economic conditions generally, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.

Contact Information

  • Contact:
    Tengasco, Inc.
    Jeffrey R. Bailey
    CEO
    865-675-1554