Pilot Energy Ltd.

Pilot Energy Ltd.

November 28, 2007 16:53 ET

Pilot Energy Ltd. -Third Quarter 2007 Results

CALGARY, ALBERTA--(Marketwire - Nov. 28, 2007) - Pilot Energy Ltd. (TSX VENTURE:PGY):

Three Months Ended Nine Months Ended
September 30 September 30
2007 2006 % Chg 2007 2006 % Chg

($ thousands, except per
share amounts)

Revenue 5,372 4,666 15 12,781 13,140 (3)

Funds from operations (1) 3,058 1,838 66 5,679 5,240 8
Per share - basic 0.14 0.09 48 0.28 0.27 4
Per share - diluted 0.14 0.09 49 0.27 0.26 5

Net income 1,027 304 238 1,032 1,124 (8)
Per share - basic 0.05 0.02 201 0.05 0.06 (12)
Per share - diluted 0.05 0.02 203 0.05 0.06 (11)

Capital expenditures
(net) 3,591 4,252 (16) 5,162 9,796 (47)
Debt (including working
capital) 11,163 14,745 (24)
Shares outstanding
(000's) 22,138 19,736 12
Weighted average shares
outstanding (000's)
basic 22,129 19,736 12 20,507 19,706 4
diluted 22,297 20,006 11 20,675 19,975 4


Daily production
Oil and NGLs (bbl/d) 842.1 732.3 15 732.1 745.6 (2)
Natural gas (mcf/d) 155.3 381.9 (59) 292.0 388.6 (25)
Oil equivalent (boe/d @
6:1) 867.9 796.0 9 780.7 810.4 (4)

Operating netback
($/boe) (2) 44.44 33.78 32 35.31 31.83 11

Funds from operations
($/boe) (1) 38.30 25.10 53 26.65 23.69 12


(1) Funds from operations is calculated as cash provided by operating
activities from the statement of cash flows, adding change in
non-cash working capital and asset retirement expenditures. Funds
from operations are used to analyze the Company's operating
performance and leverage. Funds from operations does not have a
standardized measure prescribed by Canadian Generally Accepted
Accounting Principles and therefore may not be comparable with the
calculations of similar measures for other companies.
(2) Netback is equal to total oil and natural gas revenue less royalties
and operating costs calculated on a boe basis. Netback does not have
a standardized measure prescribed by Canadian Generally Accepted
Accounting Principles and therefore may not be comparable with the
calculations of similar measures for other companies.


In June, 2007 management initiated a plan to better position the Company for future growth. The key points of the plan were to:

- pay down debt;

- reduce operating costs;

- sell non-core assets and;

- begin drilling the company's Bakken acreage in southeast Saskatchewan.

A private placement of approximately $4 million was completed in late June and was followed by the subsequent sale of non-core properties to reduce debt. The sale of the non-core properties also created a more focused asset base and reduced unit operating costs.

In the third quarter Pilot began an initial three well drilling program on 100 percent Company lands in southeast Saskatchewan to test the Bakken zone. Management dedicated a considerable amount of time researching and analyzing various drilling and completion methods used in the Bakken and is pleased with the performance of its chosen drilling and multi-stage frac completions program. Rates on the initial Bakken wells were much better than anticipated and that success, combined with the more focused asset base and upside potential for more Bakken drilling led to interest in the Company by Crescent Point Energy Trust.

The Board of Directors and management of Pilot believe that the offer by Crescent Point represents significant value for Pilot's shareholders and an opportunity for an organization with a much stronger balance sheet and resources to execute a long-term drilling program on Pilot's Bakken lands and other core properties. It also gives shareholders the opportunity to continue their participation in the southeast Saskatchewan Bakken oil trend with a low risk, high quality and well managed trust.

Reader Advisory

Barrels of oil equivalent ("boe") amounts mentioned herein have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. This conversion conforms to National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities (NI 51-101). The term "boe" may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Certain statements in this press release are forward-looking statements. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by Pilot at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors, many of which are beyond the control of Pilot. There is no representation by Pilot that actual results achieved during the forecast period will be the same, in whole or in part, as forecast.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The common shares of Pilot will not be and have not been registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

Pilot's disclosure documents can be viewed under the Company's SEDAR profile at www.sedar.com or copies can be obtained by e-mailing the Company at info@pilot-energy.com.

Issued and Outstanding Common Shares: 22,137,960

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

Contact Information

  • Pilot Energy Ltd.
    Todd Lemieux
    (403) 514-8115 ext. 226
    Pilot Energy Ltd.
    Douglas Smith
    Chief Financial Officer
    (403) 514-8115 ext. 232