CanArgo Energy Corporation
OSLO STOCK EXCHANGE : CNR
NYSE Alternext US : CNR

CanArgo Energy Corporation

August 11, 2008 19:13 ET

CanArgo Energy Corporation: Q2 Results 2008

GUERNSEY, BRITISH ISLES--(Marketwire - Aug. 11, 2008) - CanArgo Energy Corporation ("CanArgo" or the "Company") (AMEX:CNR) (OSLO:CNR) today reported results for the three and six months ending June 30, 2008.

Please see the tables attached to this release.

The Form 10-Q can be accessed at the following link;

http://www.sec.gov/Archives/edgar/data/310316/000115697308000779/0001156973-08-000779-index.htm

CanArgo is an independent oil and gas exploration and production company with its oil and gas operations currently located in Georgia.

The matters discussed in this press release include forward-looking statements, which are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated in such forward-looking statements. Such risks, uncertainties and other factors include the uncertainties inherent in oil and gas development and production activities, the effect of actions by third parties including government officials, fluctuations in world oil prices and other risks detailed in the Company's reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission. The forward-looking statements are intended to help shareholders and others assess the Company's business prospects and should be considered together with all information available. They are made in reliance upon the safe harbour provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company cannot give assurance that the results will be attained.



CANARGO ENERGY CORPORATION AND SUBSIDIARIES

Financial Statements
Consolidated Condensed Balance Sheets
Expressed in United States dollars

-------------------------------
June 30, December 31,
2008 2007
-------------------------------
(Expressed in United States
dollars)
(Unaudited)

ASSETS

Current Assets
Cash and cash equivalents $ 3,148,305 $ 6,869,381
Accounts receivable 351,912 379,268
Crude oil inventory 408,515 373,770
Prepayments 414,730 311,537
Assets to be disposed 80,134 71,294
Other current assets 164,648 167,404
-------------------------------
Total current assets $ 4,568,244 $ 8,172,654

Non Current Assets
Prepaid financing fees 259,774 74,804

Capital assets, net (including unevaluated
amounts of $13,814,437 and $9,444,742,
respectively) 53,904,667 51,304,619
-------------------------------

Total Assets $ 58,732,685 $ 59,552,077
-------------------------------
-------------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable - trade $ 1,485,589 $ 481,665
Accrued liabilities 5,822,957 6,639,887
Liabilities to be disposed 379,397 336,446
-------------------------------
Total current liabilities $ 7,687,943 $ 7,457,998

Long term debt 12,533,666 11,697,231
Other non current liabilities 1,652 37,778
Provision for future site restoration 242,256 230,720
-------------------------------

Total Liabilities $ 20,465,517 $ 19,423,727
-------------------------------

Temporary Equity $ 2,119,530 $ 2,119,530
-------------------------------

Stockholders' equity:
Common stock, par value $0.10; authorized -
500,000,000 shares at June 30, 2008 and at
December 31, 2007; shares issued, issuable
and outstanding - 242,120,974 at June 30,
2008 and at December 31, 2007 24,212,096 24,212,096
Capital in excess of par value 245,630,928 245,316,295
Accumulated deficit (233,695,386) (231,519,571)
-------------------------------
Total stockholders' equity $ 36,147,638 $ 38,008,820
-------------------------------

Total Liabilities, Temporary Equity and
Stockholders' Equity $ 58,732,685 $ 59,552,077
-------------------------------


CANARGO ENERGY CORPORATION AND SUBSIDIARIES

Financial Statements
Consolidated Condensed Statement of Operations - Unaudited
Expressed in United States dollars

Unaudited Unaudited
------------------------------------------------------------
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
------------------------------------------------------------
(Expressed in United States dollars)
Operating
Revenues from
Continuing
Operations:
Oil and gas
sales $ 2,640,234 $ 2,915,000 $ 5,230,996 $ 3,361,847
------------------------------------------------------------
2,640,234 2,915,000 5,230,996 3,361,847
------------------------------------------------------------
Operating
Expenses:
Field operating
expenses 433,149 443,873 798,085 674,424
Direct project
costs 268,302 166,188 518,275 342,834
Selling, general
and administrative 1,255,357 1,697,483 2,711,952 3,426,285
Depreciation,
depletion and
amortization 686,583 1,111,364 1,433,842 1,377,075
------------------------------------------------------------
2,643,391 3,418,908 5,462,154 5,820,618
------------------------------------------------------------

Operating Loss
from Continuing
Operations (3,157) (503,908) (231,158) (2,458,771)
------------------------------------------------------------

Other Income
(Expense):
Interest income 9,161 76,930 37,975 186,817
Interest and
amortization of
debt discount
and expense (844,703) (1,934,771) (1,704,187) (4,162,765)
Loss/Cost on
debt extinguishment - (6,534,666) - (6,534,666)
Foreign exchange
losses (100,623) (11,392) (190,627) (31,309)
Other (20,741) 262,386 (57,153) 263,871
------------------------------------------------------------
Total Other
Expense (956,906) (8,141,513) (1,913,992) (10,278,052)
------------------------------------------------------------

Loss from
Continuing
Operations
Before Taxes (960,063) (8,645,421) (2,145,150) (12,736,823)

Income taxes - - - -
------------------------------------------------------------
Loss from
Continuing
Operations (960,063) (8,645,421) (2,145,150) (12,736,823)

Net Income
(Loss) from
Discontinued
Operations, net
of taxes and
minority interest (10,871) 13,754,777 (30,665) 11,549,558
------------------------------------------------------------

Net Income
(Loss) $ (970,934) $ 5,109,356 $ (2,175,815) $ (1,187,265)
------------------------------------------------------------
------------------------------------------------------------

Weighted average
number of
common shares
outstanding
- Basic 242,120,974 238,503,148 242,120,974 238,303,156
------------------------------------------------------------
- Diluted 242,120,974 240,703,127 242,120,974 238,303,156
------------------------------------------------------------

Basic Net Income
(Loss) Per
Common Share
- from
continuing
operations $ (0.00) $ (0.04) $ (0.01) $ (0.05)
- from
discontinued
operations $ (0.00) $ 0.06 $ (0.00) $ 0.05
------------------------------------------------------------

Basic Net Income
(Loss) Per
Common Share $ (0.00) $ 0.02 $ (0.01) $ (0.00)
------------------------------------------------------------

Diluted Net
Income (Loss)
Per Common Share
- from
continuing
operations $ (0.00) $ (0.04) $ (0.01) $ (0.05)
- from
discontinued
operations $ (0.00) $ 0.06 $ (0.00) $ 0.05
------------------------------------------------------------

Diluted Net
(Income) Loss
Per Common
Share $ (0.00) $ 0.02 $ (0.01) $ (0.00)
------------------------------------------------------------
------------------------------------------------------------


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