Grand Banks Energy Corporation
TSX VENTURE : GBE

Grand Banks Energy Corporation

April 10, 2006 17:01 ET

Grand Banks Announces 2005 Results

CALGARY, ALBERTA--(CCNMatthews - April 10, 2006) -

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

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

Highlights:

- Increased average sales volumes to 898 boe per day or 491%

- Increased undeveloped landholdings to approximately 27,000 net acres

- Increased corporate proved plus probable reserves to 1.956 million boe



Year ended December 31
------------------------
2005 2004 % Change
Average Sales Volumes:
Natural gas - mcf/day 3,834 457 739
Crude oil & liquids - bbls/day 258 68 279
Sales volumes - boe/day 898 152 491

Financial Results (Canadian $000's)
Gross revenues $ 17,377 $ 2,590 571
Net Income $ 930 $ 999 (7)
Funds generated from operations $ 9,066 $ 652 1,290
Capital expenditures $ 22,255 $ 13,101 70
Working capital $ 1,777 $ 3,802 (53)
Flow-through share obligations $ 6,740 $ 5,000 35
Total assets $ 42,336 $ 24,647 72


Grand Banks has undergone very significant growth in production volumes for 2005. Successful drilling has increased average corporate production to 898 boe/day in 2005 compared to 152 boe/day in 2004. Natural gas volumes averaged 3,834 mcf/day compared to 457 mcf/day in 2004 primarily from positive drilling results in Alberta. Crude oil and liquids volumes averaged 258 bbls/day in 2005 compared to an average of 68 bbls/day in 2004 due to new wells at Kingsford in Saskatchewan and Sinclair in Manitoba.

Grand Banks has increased its undeveloped landholdings to over 27,000 net acres, of which 20,000 net acres are located in the Williston Basin, a light oil prone area located in southeast Saskatchewan and Manitoba.


Operationally, in March, 2006, Grand Banks and its partners have abandoned the deeper portion of the previously announced Brazeau area Nisku exploratory test. However, discussions are underway on a completion program to test two up-hole gas-bearing zones identified during drilling. Field work is nearly complete at Kingsford, Saskatchewan where 6 new wells have been flow-lined into an upgraded central battery facility and tied into a sales pipeline. Minimal production disruptions are anticipated over spring breakup. In Sinclair, Manitoba, Grand Banks has 13 (12.8 net) wells on production at approximately 120 bopd. Road bans are now in place, and many of these wells will be shut in until bans are lifted in about six weeks. The winter drilling program on the Sinclair Bakken/Three Forks play has identified areas of substantial development potential upon the extensive land holdings Grand Banks has in the area. License applications are being submitted for our second quarter drilling program where we intend to drill a number of horizontal wells.

On our southeast Saskatchewan Joint Venture lands, we are preparing two horizontal wells targeting light oil within the Middle Bakken resource play fairway offsetting a competitor's production in the Stoughton area. These wells will be drilled as soon as weather permits. Drilling operations are ongoing and ahead of schedule at the Grand Banks et al Tower Creek 2-21-55-27W5M location, a 5,000 meter Leduc test located near Hinton, Alberta, where Grand Banks holds a 16.67% working interest. This 3D seismically defined prospect has the potential to add over 500 boe/d of net sales volumes to Grand Banks Energy Corporation, if successful, based on analogous wells.

For a copy of Grand Bank's 2005 financial statements, management discussion and analysis and reserve filing please visit www.sedar.com.

FORWARD LOOKING STATEMENTS

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

BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.


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
    or
    Grand Banks Energy Corporation
    1600, 444 - 5th Avenue S.W.
    Calgary, Alberta T2P 2T8
    (403) 262-8666
    (403) 262-8796 (FAX)