GeoPetro Resources Company
TSX : GEP.S

GeoPetro Resources Company

April 04, 2006 20:11 ET

GeoPetro Resources Company Announces Year End 2005 Financial Results

SAN FRANCISCO, CALIFORNIA--(CCNMatthews - April 4, 2006) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

GeoPetro Resources Company ("GeoPetro" or the "Company") (TSX:GEP.S) today reported audited financial results for the year ended December 31, 2005. All currency amounts in this release are stated in U.S. dollars.

Revenue for the year ended December 31, 2005 was $7,975,990 compared to $5,825,072 in 2004, representing a 37% increase over the prior year. The Company reported net income available to common shareholders for the year of $2,111,074 ($0.10 and $0.09 per basic and diluted share, respectively), compared to a net loss available to common shareholders of $529,363 ($0.14 per basic and diluted share) in the previous year.

GeoPetro has filed its management's discussion and analysis and its audited annual financial statements for the years ended December 31, 2005 and 2004 with the Canadian securities regulatory authorities. Reference is made to the text of these documents for a complete description of GeoPetro's financial position and results as at and for the year ended December 31, 2005. These documents may be accessed under GeoPetro's profile on the SEDAR website at www.sedar.com.

GeoPetro Reserve Update

On March 31, 2006, the Company announced that it had filed its Annual Information Form ("AIF") for the year ending December 31, 2005 wherein it reported an updated estimate of 39.8 billion cubic feet (Bcf) of net proved and probable natural gas reserves at December 31, 2005 using constant prices and costs. This represents a 5.6 Bcf (16%) increase over the 34.2 Bcf of net proved and probable natural gas reserves reported by the Company at December 31, 2004 using constant prices and costs. The Company produced approximately 2 Bcf of natural gas during 2005 while the previous reserve estimates were revised upward approximately 7.6 Bcf as a result of additional acreage acquisitions completed by the Company in the Madisonville Field located in Madison County, Texas. All of the foregoing reported natural gas reserve quantities are (i) for the Madisonville Field Rodessa formation, (ii) reflected net of royalties and (iii) represent pipeline quality saleable gas.

The net present value of future net revenue (discounted at 10%) using constant prices and costs for the proved and probable reserves was estimated at approximately $103.2 million as of December 31, 2005 compared to $58.8 million as of December 31, 2004. The benchmark natural gas price utilized in the constant price and cost case was $7.80 and $5.82 per MMBTU (prior to deducting gas treating costs) as of December 31, 2005 and 2004, respectively.

The estimates of natural gas reserves and future net revenue reported in the Company's AIF were based on a report prepared by Sproule Associates Inc. dated March 31, 2006, effective as of December 31, 2005, evaluating substantially all of the Company's natural gas reserves in compliance with National Instrument 51-101 of the Canadian Securities Regulators. For a complete description of the Company's natural gas reserve estimates and a description of the Sproule's report, see the Company's AIF, which is filed on the SEDAR website at www.sedar.com.

GeoPetro Operations Update for Madisonville Project, Madison County, Texas

The Company today announced that it has completed drilling operations to a total depth of 12,300 feet on the Wilson #1 well, its third production well in the Madisonville Field. A production liner has been set in the well and the Company plans to complete the well in the Rodessa formation at approximately 12,000 feet. A second drilling location (the fourth planned production well), the Mitchell #1 well, has been constructed approximately one mile south of the Company's Magness #1 well. The Company plans to move the drilling rig currently on the Wilson #1 well to the Mitchell #1 well location and commence drilling thereon within the next several days.

No stock exchange or regulatory authority has approved or disapproved of the information contained herein. GeoPetro's common shares have not been registered under the United States Securities Act of 1933 (the "1933 Act") or the securities laws of any state and may not be offered or sold in the United States or to U.S. persons, except pursuant to registration under the 1933 Act or pursuant to an available exemption from such registration requirements. The ".S" suffix in the trading symbol indicates that the common shares are subject to trading restrictions imposed pursuant to Regulation S under the 1933 Act. In particular, the common shares may not, for a period of two years from the date of issuance, be offered or sold to persons in the United States or U.S. persons except in transactions exempt from registration under the 1933 Act. Hedging transactions involving the common shares must not be conducted unless in accordance with the 1933 Act.

Except for the historical and present factual information contained herein, the matters set forth in this news release, including words such as "expects", "projects", "plans" and similar expressions, are forward-looking information that represents management of GeoPetro's internal projections, expectations or beliefs concerning, among other things, future operating results and various components thereof or the economic performance of GeoPetro. The projections, estimates and beliefs contained in such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause GeoPetro's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, those described in GeoPetro's filings with the Canadian securities authorities. Accordingly, holders of GeoPetro securities and potential investors are cautioned that events or circumstances could cause results to differ materially from those predicted.

Contact Information

  • GeoPetro Resources Company
    Stuart Doshi
    President & Chief Executive Officer
    (415) 398-8186
    sdoshi@geopetro.com