Suroco Energy Inc.
TSX VENTURE : SRN

Suroco Energy Inc.

November 25, 2010 16:17 ET

Suroco Energy Inc. Announces Filing of Third Quarter Financial Statements and MD&A

CALGARY, ALBERTA--(Marketwire - Nov. 25, 2010) -

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

Suroco Energy Inc. (TSX VENTURE:SRN) (the "Corporation") is pleased to announce that it has filed its Unaudited Consolidated Financial Statements and the related Management's Discussion and Analysis ("MD&A") for the three and nine months-ended September 30, 2010 on the System for Electronic Document Analysis and Retrieval ("SEDAR").

Copies of these documents can be found on the SEDAR website at www.sedar.com.

Alastair Hill, the Corporation's President and CEO commented, "Production for the third quarter averaged 821 barrels per day after royalty, below our second quarter average and due in part to production being temporarily suspended from a key producing well which was worked over and cleaned for scale build-up. Sales revenue was significantly lower than anticipated due to a delay in the sale of two important oil cargoes. This delay was due to a temporary interruption in access to a third party-owned pipeline. The two cargoes, representing approximately 64 days of average production, were sold in October at a higher price than would have been achieved had they been sold in the third quarter and will be reflected in the Corporation's fourth quarter results. With these sales recorded in the fourth quarter of 2010, we remain confident that we will reach our cash flow and production targets."




Financial & Operating Highlights
(All references to $ are Canadian
dollars unless otherwise noted)

3 months ended 9 months ended
September 30 September 30
2010 2009 2010 2009
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Financial

Oil and gas revenue ($) 6,212,609 2,652,927 20,267,995 7,453,388
Funds flow from
operations (1) ($) 282,784 142,681 6,733,220 34,438
Per share - basic ($) 0.00 (0.02) 0.06 0.00
Per share - diluted ($) 0.00 (0.02) 0.04 0.00
Net loss ($) (1,433,338) (1,916,949) (475,576) (2,479,973)
Per share - basic ($) (0.02) (0.02) (0.01) (0.04)
Per share - diluted ($) (0.02) (0.02) (0.01) (0.04)
Total assets ($) 47,763,529 36,804,590 47,763,529 36,804,590
Net working capital (1) ($) 18,549,567 9,428,428 18,549,567 9,428,428
Common shares outstanding,
end of period
Basic 119,958,176 86,940,240 119,958,176 86,940,240
Diluted 157,854,489 124,944,646 157,854,489 124,944,646
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Average daily net
production (boe per day) 821 319 774 275
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(1) Non-GAAP measure.


Highlights



-- Completed a private placement financing which resulted in issuing
29,283,446 common shares for gross proceeds of $13,177,553.
-- Exited quarter with production of 800 boe per day, net after royalty,
and averaged 821 boe per day for the quarter, net after royalty.
-- Revenue was negatively affected in the quarter due to a delay in the
sales of August production until October 2010 due to the temporary shut-
down of a third party pipeline. As of September 30, 2010, the
Corporation had approximately 64 days of production in inventory (versus
36 days at June 30, 2010), most of which was sold in October at an
average price of $US 72.82 per barrel.
-- Divested of interest in Arjona Block to focus capital towards light oil
projects in the Putumayo and Llanos basins in Colombia.
-- Completed workover for Pinuna 1 well.
-- Mobilized drilling rig to Suroriente Block which spudded the first of a
multi-well appraisal and development program in October 2010.


References herein to "boe" mean barrels of oil equivalent derived by converting gas to oil in the ratio of six thousand cubic feet (Mcf) of gas to one barrel (bbl) of oil. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

The Corporation is a Calgary-based junior oil and gas company, which explores for, develops, produces and sells crude oil, natural gas liquids and natural gas in Colombia and Western Canada. The Corporation's common shares trade on the TSX Venture Exchange under the symbol "SRN".

Forward Looking Statements

Certain information regarding the Corporation contained herein may constitute forward looking statements within the meaning of applicable securities laws. Forward looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of facts. Although the Corporation believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will be realized. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward looking statements. The Corporation's forward looking statements are expressly qualified in their entirety by this cautionary statement.

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Suroco Energy Inc.
    Alastair Hill
    President and Chief Executive Officer
    (403) 232-6784
    (403) 264-7455 (FAX)
    or
    Suroco Energy Inc.
    Travis Doupe
    VP Finance and Chief Financial Officer
    (403) 232-6784
    (403) 264-7455 (FAX)
    www.suroco.com