Diaz Resources Ltd.

Diaz Resources Ltd.

March 30, 2005 19:48 ET

Diaz Reports Improved Financial and Operating Results and Increased Reserves for 2004, and Confirms Significant Discoveries


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: DIAZ RESOURCES LTD.

TSX SYMBOL: DZR.SV.A
TSX SYMBOL: DZR.MV.B

MARCH 30, 2005 - 19:48 ET

Diaz Reports Improved Financial and Operating Results
and Increased Reserves for 2004, and Confirms
Significant Discoveries

CALGARY, ALBERTA--(CCNMatthews - March 30, 2005) -

Financial and Operating

Diaz Resources Ltd. (TSX:DZR.SV.a)(TSX:DZR.MV.b) today reported record
financial and operating results for the year ended December 31, 2004.
Revenue for the year increased by approximately 40% to $14.3 million,
from $10.0 million in 2003. Higher revenues resulted from increases in
production and commodity prices, during the year.

Cash flow for the year increased to $8.8 million, or $0.15 per share,
fully diluted, compared with $5.8 million, or $0.12 per share in 2003.
The Company reported earnings of $1.5 million, or $0.03 per share,
compared with earnings of $2.0 million in the prior year.

Oil and gas production increased to average 1,175 BOEd, compared with
904 BOEd in 2003. Natural gas production increased by 30% to 6.4 MMcfd
for the year, while oil production increased 29% to 110 Bopd in 2004.

Diaz also announced that an independent evaluation of the Company's oil
and gas reserves, conducted by AJM Petroleum Consultants, dated March
17, 2005, has assigned established reserves of 4,848 MBOE to the
Company's properties, having a net present value, before income tax, of
$65.9 million, at a 10% discount rate. Established reserves increased by
8.25% during the year. Diaz has used the current industry standard of
six Mcf of natural gas to one barrel of oil for the BOE conversion.



Summary of Reserves

SUMMARY OF OIL AND GAS RESERVES
AND NET PRESENT VALUES OF FUTURE NET REVENUE
AS OF DECEMBER 31, 2004
FORECAST PRICES AND COSTS

RESERVES
----------------------------------------------------
COMPANY TOTAL LIGHT AND NATURAL GAS
------------- MEDIUM OIL HEAVY OIL NATURAL GAS LIQUIDS
----------------------------------------------------
Gross Net Gross Net Gross Net Gross Net
RESERVES CATEGORY (MBbl)(MBbl) (MBbl)(MBbl) (MMcf) (MMcf) (MBbl)(MBbl)
----------------------------------------------------------------------
PROVED
Developed
Producing 166 141 5 4 7,273 5,967 8 6
Developed
Non-producing - - - - 591 486 - -
Undeveloped 67 53 - - 7,551 6,526 25 19
----------------------------------------------------------------------
TOTAL PROVED 233 194 5 4 15,415 12,979 33 25
PROBABLE 76 54 8 7 11,411 9,437 15 10
----------------------------------------------------------------------
TOTAL PROVED
PLUS
PROBABLE 309 248 13 11 26,826 22,416 48 35
----------------------------------------------------------------------
----------------------------------------------------------------------

NOTE: (1) Figures may not add due to rounding.


Exploration

Exploration highlights of the year included the drilling of a four-zone
Wilcox gas well at Allen Ranch, Colorado County, Texas. The lowest of
the four zones was completed last week and flowed at a rate of 1.6 MMcfd
with a flowing pressure of 4,350 psi. A second zone in the well, in
which Diaz holds a 20% working interest will be completed within the
next two weeks and commingled with the lowest zone. Production
facilities and a pipeline to the well are currently being installed.

In addition, the Company has completed a well in the Harmattan area of
west central Alberta which encountered both a gas zone and an oil zone.
Well details are currently confidential but the well is presently being
tied in to production facilities and should be placed on stream within
two weeks. Diaz holds a 40% working interest in the well and has
licensed a second well in the same area.

Diaz is an oil and gas exploration and production company based in
Calgary, Alberta. Diaz's current focus is on shallow gas developments in
southern Alberta and deep Wilcox gas exploration in Texas.

SEDAR Filings

Further information regarding financial and operating results may be
obtained at www.sedar.com, where the Company's MD&A and financial
statements have been filed.

Diaz has also filed its Annual Information Form ("AIF"), which includes
the Company's reserves data and other oil and gas information for the
year ended December 31, 2004, as mandated by National Instrument 51-101
Standards of Disclosure for Oil and Gas Activities of the Canadian
Securities Administrators. Copies of Diaz's AIF may be obtained at
www.sedar.com.

Forward-looking statements - statements included in this press release
that are not historical facts may be considered "forward-looking
statements." All estimates and statements that describe the Company's
objectives, goals or future plans are forward-looking statements.
Forward-looking statements involve inherent risks and uncertainties
where actual results could differ materially from those currently
anticipated.



Summary of Operations

Years Ended December 31
-----------------------
(Restated)
(Thousands, except per share amounts) 2004 2003
------------------------------------------------------------------------
Financial
Total revenue $ 14,281 $ 10,067
Cash flow from operations $ 8,785 $ 5,766
per share, diluted $ 0.15 $ 0.12
Net earnings for the year $ 1,544 $ 2,041
per share, diluted $ 0.03 $ 0.04
Property, plant and equipment
Additions $ 12,151 $ 8,699
Dispositions $ 212 $ 921
Net debt $ 9,095 $ 7,100
Total assets $ 46,675 $ 39,636
Total shares outstanding 59,601 57,277

Operations
Production
Gas (MMcfd) 6.4 4.9
Oil (Bopd) 110 86
BOEd (6Mcf equals 1Bbl) 1,175 904
Product Prices
Gas ($/Mcf) $ 6.77 $ 6.05
Oil ($/Bbl) $ 47.05 $ 44.26
Reserves (proved plus probable,
future costs and prices)
Gas (Bcf) 26.8 25.1
Oil (MBbl) 370.0 282.0
BOE (millions) 4.8 4.5
Present value, before tax ($millions at 10%) $ 65.9 $ 40.9
Undeveloped land holdings (net acres)
Canada
Alberta 79,505 95,630
Saskatchewan 4,801 6,686
United States 3,228 2,608
-----------------------
Total net acreage 87,534 104,924
------------------------------------------------------------------------
------------------------------------------------------------------------


-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Diaz Resources Ltd.
    Robert W. Lamond
    Chairman
    (403) 269-9889
    (403) 269-9890 (FAX)
    or
    Diaz Resources Ltd.
    Charles A. (Tony) Teare
    Executive Vice President
    (403) 269-9889
    (403) 269-9890 (FAX)
    Email: info@diazresources.com
    Website: www.diazresources.com
    The Toronto Stock Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release.