May 13, 2008 19:11 ET

Oilexco Announces First Quarter Results

CALGARY, ALBERTA--(Marketwire - May 13, 2008) - Oilexco Incorporated ("Oilexco" or "the Company") (TSX:OIL) (LSE:OIL) is pleased to announce the Company's results for the three months ended 31 March 2008.

Arthur Millholland, President and Chief Executive Officer, commented:

"The first quarter of 2008 proved to be another successful period for Oilexco on a number of fronts. We began integrating and investing in the Balmoral FPV following its acquisition at the end of 2007, and we will accelerate development drilling in the area as we build it into a production hub for the Company.

"Oilexco also enjoyed further success with the drill bit during the quarter at Huntington and Bugle, as we continued our aggressive programme of development, appraisal and exploration drilling."


Record Financial Results

- Revenue reached $172.4 million (Q1 2007: $2.0 million).

- EBITDA increased to $146.6 million (Q1 2007: ($2.4) million).

- Net Income of $49.9 million (Q1 2007: ($5.3) million).


- Average daily production of oil and gas of 20,714 BOE / day.

-- Continued to make production enhancements at the Brenda / Nicol fields.

- Benefited from the increase in oil prices with an average price of $96.47 per barrel.

- Operational costs decreased to $8.43 per barrel; netback of $88.04 per barrel.


- Extensive drilling programme continued during the quarter, with successful appraisal drilling at Huntington and Bugle.

- Commenced drilling of the first of several additional development wells in the area of the Balmoral FPV.

- After period end, Oilexco announced a Share Purchase Agreement for Svenska Petroleum Exploration UK Limited that will give additional production, strategic interests in two production facilities and a new regional foothold.


- Exploration drilling to continue on the Moth prospect.

- Increased production in H2 2008 from additional wells at Brenda, Nicol and Balmoral fields.

- Further appraisal drilling planned on Bugle block to determine the aerial extent of the field and find the oil/water contact.

- Exploration drilling will occur on the Delta Block (16/21b), a farm-in giving the Company a 55% working interest.

- Drilling will commence on two production wells on Shelley in the summer with first production targeted for Q4 2008.

- Contract extension for the Ocean Guardian semi-submersible drilling vessel until July 2011; the short term assignment of the Sedco 704 semi-submersible drilling vessel from May to August 2008.

The results and associated Management Discussion and Analysis and Financial Statements are available at www.oilexco.com and www.sedar.com.

About the Company

Oilexco is an oil and gas exploration and production company active in the United Kingdom. Oilexco's producing properties, exploration and development activities are located in the UK Central North Sea, specifically in the Outer Moray Firth and Central Graben areas. Oilexco operates in the United Kingdom through its wholly owned subsidiary, Oilexco North Sea, a company registered under the laws of England and Wales. Oilexco shares are listed for trading on the London Stock Exchange (LSE) and the Toronto Stock Exchange (TSX) under the symbol "OIL".

Forward Looking Statements

This disclosure contains certain forward-looking statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond Oilexco's control, including: the impact of general economic conditions in the areas in which Oilexco operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations, therefore Oilexco's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements will transpire or occur, or if any of them do so, what benefits, including the amounts of proceeds, which Oilexco will derive therefrom. All statements included in this press release that address activities, events or developments that Oilexco expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements include future production rates, completion and production timetables and costs to complete wells, and production facilities. These statements are based on assumptions made by Oilexco based on its experience perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.

Contact Information

  • Oilexco Incorporated
    Arthur S. Millholland
    (403) 262-5441
    Oilexco Incorporated
    Brian L. Ward
    Chief Financial Officer
    (403) 262-5441
    Oilexco Incorporated
    Rob Elgie
    Manager Investor Relations
    (403) 262-5441
    Website: www.oilexco.com
    Pelham PR
    James Henderson
    Managing Director
    44 (20) 7743 6673
    Pelham PR
    Alisdair Haythornthwaite
    44 (20) 7743 6676