Grand Banks Energy Corporation

Grand Banks Energy Corporation

May 31, 2005 11:49 ET

CORRECTION FROM SOURCE: Amended News Release Re: Grand Banks Q1 Results

CALGARY, ALBERTA--(CCNMatthews - May 31, 2005) -


The news release issued earlier today contained references to financial results being in the thousands which were not. Accordingly, today's previous news release is replaced in it's entirety with the following:

Grand Banks Energy Corporation (TSX VENTURE:GBE) (the 'Company') is pleased to announce its financial and operating results for the three months ended March 31, 2005.

First quarter highlights:

- Increased Q1 average sales volumes to 473 barrels of oil equivalent per day.

- Closed a private placement of flow through shares for total gross proceeds of $5,850,000.

- Achieved exit volume in excess of 1,000 boe/d.

Three months ended March 31
2005 2004 % Change
Average Sales Volumes:
Natural gas - mcf/day 2,224 270 724
Crude oil & liquids - bbls/day 98 60 63
Sales volumes - boe/day 473 115 311

Financial Results ($000's)
Gross revenues $ 1,921 $ 477 303
Income (loss) before taxes $ (282) $ (180) 57
Cash flow from operations $ 856 $ 27 3,070
Capital expenditures $ 6,673 $ 816 718

March 31, 2005 December 31, 2004
Working capital $ 3,805 $ 3,802
Total assets $ 30,934 $ 24,647

Grand Banks Energy Corporation has undergone very significant growth in production volumes in Q1, 2005. Successful drilling has increased corporate production to a Q1 exit rate in excess of 1,000 boe/d. The Company also expects the tie-in, by the end of Q3, of 2 gas wells at Kakwa and an oil well at Wood River that are expected to add net production of about 230 boe/d. These tie-ins will help to offset expected declines from a high deliverability Company gas well that is in a competitive drainage situation. Budgeted drilling activity for the remainder of 2005 is expected to maintain or exceed production levels in the 800 to 1,000 boe/d range, with upside to that range dependent on exploration success.

Grand Banks Board of Directors has approved a capital budget under which the Company is projected to spend, between now and the end of 2005, approximately $15.0 million upon a number of projects, including the drilling of up to 26 wells (18.5 net). The first well in the program has recently commenced drilling offsetting our 2004 multi-zone discovery on the Peace River Arch.

A number of the other wells in the program are slated to spud during the summer, including five deep high-impact gas exploration wells; three in the Peace River Arch, one in West Central Alberta, and one in Northeast British Columbia. The aforementioned projection does not include the Harley well, a deep Leduc test to be drilled near Hinton, Alberta, in which Grand Banks holds a 16.67% working interest and which is expected to spud around the end of August. This exploration well alone, if successful, has the potential, based upon the production from analogous wells, to add over 500 boe/d of net sales volumes to Grand Banks Energy Corporation. Also, production from the Harley well is not included in our production forecasts for 2005.

Grand Banks has continued to acquire land in Saskatchewan and Manitoba that is prospective for light oil production from the Bakken formation at shallow drilling depths of 1,050 meters. Grand Banks now owns about 15,000 net acres of land in this region, and has recently completed a seismic program that has been used to confirm drilling locations for a five well program that is expected to commence in June 2005. Grand Banks' interest in these wells will be 100%. After reviewing the results of these wells, the Company will commence the drilling of up to 10 additional wells targeting crude oil from the Bakken formation in September or October. The acreage position that Grand Banks has accumulated on this play has the potential to support the drilling of over 50 development wells, dependent upon the results from the initial programs and exploratory step-out wells. The play is especially attractive because of year round accessibility, relatively shallow drilling depths, the high quality of the crude oil, royalty holidays and low operating costs.

For a copy of Grand bank's first quarter financial statements and management discussion and analysis please visit

Grand Banks is listed on the TSX-Venture Exchange under the Symbol GBE.


This press release contains forward-looking statements including expectations of future production. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated.

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

Contact Information

  • Grand Banks Energy Corporation
    E.C. (Ted) McFeely
    Chairman, President and Chief Executive Officer
    (403) 262-8666
    (403) 262-8796 (FAX)
    Grand Banks Energy Corporation
    1600, 444 - 5th Avenue S.W.
    Calgary, Alberta T2P 2T8