Centurion Energy International Inc.

Centurion Energy International Inc.

March 21, 2005 09:30 ET

Centurion Announces Financial Results for the Year Ended December 31 2004 and Reserves Update


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: CENTURION ENERGY INTERNATIONAL INC.

TSX SYMBOL: CUX
AIM SYMBOL: CUX.L

MARCH 21, 2005 - 09:30 ET

Centurion Announces Financial Results for the Year
Ended December 31 2004 and Reserves Update

CALGARY, ALBERTA--(CCNMatthews - March 21, 2005) - Centurion (TSX:CUX)
(AIM:CUX.L) will be hosting a conference call on Monday March 21, 2005
at 10:00 AM Calgary time (5 PM London time) to discuss year end results.
All interested investors are invited to participate in the conference
call, and should refer to the conference call section at the end of this
press release for more information.

SUMMARY

- Exit production rate doubled for the third year in a row, exiting at
21,150 boepd.

- Proved reserves increased by 16 million boe

- Record cash flow of $42.1 million (2003 -$30.8 million)

- Record levels of earnings of $13.4 million (2003 - $10.6 million)

- Five wells drilled on Centurion's Development Leases in Egypt's Nile
Delta in 2004 with 100% success

Commenting, Said Arrata, President and CEO, said:

"I am very pleased to report another successful year for the Company in
which we have achieved several new milestones in terms of production,
reserves additions, cash flow and earnings. Following our January
fundraising and on completion of the sale of our Tunisian production
assets, Centurion will have in excess of $100 million of working
capital. We are confident that this will be sufficient working capital
to meet our projected capital expenditure in the current year. Centurion
is well placed for further growth in 2005 and beyond."

2004 was another successful year for Centurion with several new
milestones reached. Exit production rate doubled for the third year in a
row, exiting at 21,150 boepd. Current production is 20,600 boepd
excluding the Tunisian production that is being sold. Proved and
probable reserves increased from 38 million boe to 51 million boe after
replacing 4 million boe of production. Of this increase, 94% was in the
proved category exclusively from the Nile Delta Development Leases in
Egypt. At December 31, 2004, reserves per weighted average share
outstanding increased by 9% to 0.62 boe per share even though the
weighted average number of shares increased by 23%. Record levels of
earnings ($13.4 million) and cash flow ($42.1 million) were also
achieved.

Operations

Five wells were drilled on Centurion's Development Leases in Egypt's
Nile Delta in 2004 with 100% success. Following the drilling successes
in the El Wastani and South El Manzala Development Leases, the company
negotiated an increase in the existing gas purchase agreements with the
Egyptian Gas Company from 47 mmscf/day to 250 mmscf/day. Centurion
subsequently mobilized two rigs to start an active drilling program and
initiated the construction of a 100% owned gas processing plant, and the
twinning of its South El Manzala gas pipeline to expedite delivery of
gas at the 250 mmscf/day production level and to increase the amount of
associated liquids that can be recovered for Centurion's account and
sold at market prices in conjunction with the gas sales.

2004 also saw Centurion continue its focus on Egyptian exploration based
on the level of success achieved in the Nile Delta to date. In early
2004, Centurion and its 25% partner were the successful bidders on two
new exploration blocks, West Manzala and West Qantara, encompassing
800,000 acres which surround Centurion's existing Development Leases.
Centurion already has substantial 2D seismic data on the new
concessions, but recently commenced a 2,000 square kilometer 3D seismic
program to update and further define the drilling targets, and expects
an active drilling program in the Nile Delta for several years.

As part of the shift in focus to higher impact exploration and
development in Egypt, Centurion has entered into a conditional agreement
to sell its current producing assets in Tunisia subsequent to year end
for $41.2 million plus working capital adjustments. Cash flow from the
company's Tunisian operations has provided a basis for the growth in
assets and production, however the mature assets and the related
overhead are no longer considered core to Centurion's future growth. The
company drilled four wells in Tunisia during 2004 resulting in one
producing oil well. The company still sees exploration upside in Tunisia
and has retained its interest in the Mellita Permit in Tunisia, which is
farmed out to PetroCanada, and has retained the right to participate in
any drilling carried out on the Ezzaouia and El Biban Concessions to
test potential Triassic reservoirs. Proceeds received from the sale will
be used to fund exploration and development activities in Egypt and for
other higher impact foreign opportunities.

Financing

Centurion has never been in a stronger financial position. The company
added to its strong working capital position by completing two
financings raising approximately $25 million in August 2004 and another
$40 million in January 2005. Upon the completion of the conditional sale
of the Tunisian assets, Centurion will have working capital in excess of
$100 million. This strong working capital position, augmented by 2005
cash flow from Egyptian operations provides more than enough funding to
meet projected 2005 capital expenditures.

Cash flow and earnings

Cash flow and earnings for 2004 also reached record levels and would
have been even higher except for the exclusion of revenue in the 2004
accounting period for 64,041 barrels of oil production in Tunisia that
was not sold until after year-end. Cash flow for the year ended December
31, 2004 was $42.1 million ($0.54 basic, $0.51 diluted) and earnings
were $13.4 million ($0.17 basic, $0.16 diluted). Including the
recognition of the sale of 2004 production inventoried at year end would
have increased cash flow by $2.3 million ($0.03 per share) and earnings
by $1.6 million ($0.02 per share).



Performance Indicators

2004 2003 2002
------------------------------------------------------------------------
Financial
($000's except per share amounts)

Cash Flow - continuing operations 31,029 10,732 6,341
Cash Flow - discontinued operations 11,036(1) 20,063 15,772
Cash flow - corporate 42,065(1) 30,795 22,113
Basic per share - continuing operations $ 0.40 $ 0.17 $ 0.10
Diluted per share - continuing operations $ 0.38 $ 0.16 $ 0.10
Basic per share - corporate $ 0.54(1) $ 0.48 $ 0.35
Diluted per share - corporate $ 0.51(1) $ 0.46 $ 0.35
Earnings - continuing operations 10,505 536 513
Earnings - discontinued operations 2,895(1) 10,091 5,975
Earnings - corporate 13,400(1) 10,627 6,488
Basic per share - continuing operations $ 0.13 $ 0.01 $ 0.01
Diluted per share - continuing operations $ 0.13 $ 0.01 $ 0.01
Basic per share - corporate $ 0.17(1) $ 0.17 $ 0.10
Diluted per share - corporate $ 0.16(1) $ 0.16 $ 0.10
Net Revenue - continuing operations 54,796 24,425 13,566
Net Revenue - corporate 72,693 52,104 34,365
Total Assets 180,657 148,744 142,444
Total Long Term Financial Liabilities 34,735 33,677 37,918

Production

Average daily rate (boepd )
- continuing operations 9,854 4,185 2,060
- discontinued operations 1,621 2,417 2,498
- corporate 11,475 6,602 4,558
Annual production (mboe)
- continuing operations 3,605 1,528 752
- discontinued operations 594 882 912
- corporate 4,199 2,410 1,664

------------------------------------------------------------------------
(1) Subsequent to year end, Centurion conditionally sold its Tunisian
producing assets for $41.2 million. Earnings and cash flow do not
include the sales effect of 64,041 barrels of Tunisian oil that was
inventoried at year end. If this inventory had been included in sales,
cash flow would have increased by $2.3 million dollars ($0.03 per share)
and earnings would have increased by $1.6 million ($0.02 per share). The
sale of the producing assets was effective January 1, 2005 and the
incremental cash flow to Centurion of $2.3 million related to the crude
oil inventory will be added as a purchase price adjustment upon closing
of the sales agreement.


Note: Natural gas has been converted into barrels of oil equivalent at
6:1. Boe's disclosed in this table may be misleading, particularly if
used in isolation. A boe conversion ratio of 6mcf:1 boe is based on an
energy equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.

Centurion also discloses certain financial information (cash flow and
cash flow from operations) in this disclosure that do not have any
standardized meaning as prescribed by Canadian GAAP and are therefore
considered non GAAP measures. These measures may not be comparable to
similar measures presented by other public issuers.

Proved plus Probable Reserves (MMBOE)

(Company share of gross reserves as evaluated by Ryder Scott Company as
at December 31, 2004 in accordance with NI 51-101. Reserve data provided
prior to 2004 was evaluated by Adams Pearson Associates.)



------------------------------------------------------------------------
Egypt Tunisia Total
Egypt Proved and Tunisia Proved and Total Proved and
Proved Probable Proved Probable Proved Probable
------------------------------------------------------------------------
2004 28.1 45.5 3.4 5.9 31.5 51.4
------------------------------------------------------------------------
2003 8.9 28.0 6.2 10.1 15.1 38.1
------------------------------------------------------------------------
2002 9.6 26.6 7.7 11.7 17.3 38.3
------------------------------------------------------------------------
2001 10.5 27.8 8.2 11.0 18.7 38.8
------------------------------------------------------------------------
------------------------------------------------------------------------


After subtracting production for the year, Corporate reserves increased
by 17.5 million boe (proved and probable), replacing 2004 production by
a ratio of 4.2 times. This increase is mainly a result of the
application of 3-D seismic and successful drilling results in the
Company's Nile Delta lands.

Conference Call Information

Centurion will be hosting a conference call on Monday March 21, 2005 at
10:00 AM Calgary time (5 PM GMT) to discuss year end results. All
interested investors are invited to participate in the conference call,
and should refer to the table below for connection instructions.

Numbers to Dial:

North America 1-403-410-7545 or 1-866-792-1318

Outside of North America - appropriate country code + 800 8097 7630

After connecting to the system, you will be prompted for the Conference
ID, which is 6080546.

Not for distribution to United States newswire services or for
dissemination in the United States.

Certain statements in this News Release constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements involve risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Corporation to be materially
different from any future results, performance or achievements expressed
or implied by such forward looking statements. Statements related to
"reserves" or "resources" are deemed to be Forward Looking Statements as
they involve the implied assessment, based on certain estimates and
assumptions, that the resources and reserves described can be profitably
produced in the future.

Boe's disclosed in this new release may be misleading, particularly if
used in isolation. A boe conversion ratio of 6mcf:1 boe is based on an
energy equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Centurion Energy International Inc.
    Said S. Arrata
    President and CEO
    (403) 263-6002
    (403) 263-5998 (FAX)
    or
    Centurion Energy International Inc.
    Barry W. Swan
    Senior Vice President and CFO
    (403) 263-6002
    (403) 263-5998 (FAX)
    or
    Centurion Energy International Inc.
    Scott Koyich
    Investor Relations
    (403) 215-5979
    Email: info@centurionenergy.com
    Website: www.centurionenergy.com