November 28, 2007 14:05 ET

Tuscany Energy Announces Financial and Operating Results for the Nine Months Ended September 30, 2007

CALGARY, ALBERTA--(Marketwire - Nov. 28, 2007) - Tuscany Energy Ltd. (TSX VENTURE:TUS) -


Tuscany's financial and operating results for the nine months ended September 30, 2007, were lower than the same period in 2006 due primarily to reduced production volumes and depressed natural gas prices. Strong oil prices and narrower price differential between light sweet crude at Edmonton and Hardisty's Bow River Blend experienced in the first half of 2007 were offset in the third quarter primarily by the rise in the Canadian dollar. As a result, the Company received an average of $46.77 per Bbl for its crude for the nine-month period of 2007 compared to $46.79 per Bbl received in the first six months of 2006. Gas sales in the first nine months of 2007 experienced steeper than anticipated declines due to a well at Macklin watering out in the previous quarter. Consequently, the Company's natural gas sales for the period were 216 Mcf per day compared to 390 Mcf per day in the same period of 2006. Tuscany received an average of $6.37 per Mcf for its natural gas in the period compared to $6.62 per Mcf in the same period of 2006, a period-over-period decrease of 4%.


On September 28, 2007, the Company announced a $750,000 non-brokered private placement on a flow-through basis. The offering was subsequently over-subscribed and the Company later announced on October 18, 2007, that the offering was being increased to $1M. The Company closed the financing on October 23, 2007. The proceeds of the offering will be used for Tuscany's Canadian exploration and development program on expenditures which satisfy flow-through requirements.

Revenue for the three and nine month periods ended September 30, 2007, totaled $469,000 and $1.43 million respectively compared to $603,000 and $1.67 million respectively for the same periods on 2006.

The cash flow deficiency from operations for the Q3 was $80,000 compared with the cash flow of $126,000 in Q3 2006. The cash flow deficiency from operations for the nine month period ended September 30, 2007, was $143,000 compared with the cash flow of $381,341 in the previous year.

Capital expenditures for the nine months ended September 30, 2007, totaled $471,000 compared with the $1.3 million during the same period in 2006. The Company's capital expenditures and cash flow deficiencies during the period were funded from bank borrowings.


On October 25, 2007, the Alberta government announced changes to the Alberta royalty framework that will take effect on January 1, 2009. Based on the Company's review of this new royalty structure, the Company's current production remains unaffected as the majority of Tuscany's production is in Saskatchewan. However, over the longer term, the actual effect will be determined based on the actual legislation enacted, production rates, commodity prices, foreign exchange rates, production mix and service costs as they exist on January 1, 2009.


The Company has continued operations with a pared down staff level. With the addition of production from the new well drilled at Evesham and from the Wildwood well being placed on production, Tuscany's revenue and cash flow should improve. Tuscany plans a new exploration well in west-central Alberta and further development of the Evesham properties with the additional funds raised subsequent to the quarter end.

Nine months ended September 30,
Financial ($ 000's except where noted) 2007 2006
Total revenue $ 1,428 $ 1,669
Cash flow (deficiency) from
operations $ (143) $ 381
per share, diluted $ (0.01) $ 0.01
Loss for the period $ (1,404) $ (306)
per share, diluted $ (0.05) $ (0.01)
Capital additions $ 471 $ 1,279
Net debt $ 2,970 $ 2,082
Total assets $ 8,117 $ 8,731
Gas (Mcfd) 216 390
Oil (Bopd) 95 100
BOEd (6 Mcf = 1 Bbl) 131 165
Product Prices
Gas ($/Mcf) $ 6.37 $ 6.62
Oil ($/Bbl) $ 46.77 $ 46.79

Total shares outstanding, at period
end 26,550 25,149

- Boe Presentation - The term barrels of oil equivalent (Boe) may be misleading, particularly if used in isolation. A Boe conversion ratio of 6 million cubic feet (Mcf): 1 barrel (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. All Boe conversions in this report are derived by converting gas to oil in the ratio of six Mcf of gas to one Bbl of oil.

Additional information concerning Tuscany's financial statements and associated Management's Discussion and Analysis for the period ended, September 30, 2007, can be found on the SEDAR website at www.sedar.com.

Forward-looking statements - statements included in this press release that are not historical facts may be considered "forward-looking statements." Actual results could differ materially from the conclusions, forecasts or projections in the forward-looking information. Certain material factors and assumptions were applied in drawing the conclusions or making the forecasts or projection in the forward-looking information and the material factors or assumptions that were applied in drawing the conclusion or making the forecast or projection as reflected in the forward-looking information is contained in the press release.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

    Greg T. Busby
    President, CEO & Interim CFO
    (403) 264-2398
    (403) 264-2399 (FAX)
    Robert W. Lamond
    (403) 269-9889
    (403) 269-9890 (FAX)