Tango Energy Inc.

Tango Energy Inc.

May 25, 2007 23:59 ET

Tango Reports First Quarter 2007 Financial and Operating Results

CALGARY, ALBERTA--(Marketwire - May 25, 2007) - Tango Energy Inc. ("Tango") (TSX VENTURE:TEI) is pleased to report on its unaudited interim financial and operating results for the three months ended March 31, 2007.


Three Months Ended

March 31,

2007 2006


Financial Results ($000s, except per share amounts)

Gross revenues 2,904 1,260

Income (loss) before taxes (342) 28

Net income (loss) (216) 7

Per share - basic $0.00 $0.00

Per share - diluted $0.00 $0.00

Funds flow from operations 1,354 703

Per share - basic $0.03 $0.02

Per share - diluted $0.03 $0.02

Additions to property and

equipment, net of proceeds 4,146 4,668

Total assets 43,397 33,838

Working capital (deficiency) (8,463) 3,269

Asset retirement obligation 603 517

Flow-through share obligations 1,300 3,300


Share Data (000s)

Equity outstanding

Common shares 49,505 42,157

Stock options and warrants 4,075 2,410


Fully diluted 53,580 44,567


Sales Volumes (average)

Natural gas (mcf/d) 3,805 1,404

Crude oil and liquids (bbls/d) 32 21

Average boe/d 666 255


Product Prices (average)

Natural gas ($/mcf) 7.92 8.42

Crude oil and liquids ($/bbl) 58.80 63.17


Netback Analysis ($/boe)

Oil and gas revenue 48.04 51.53

Royalty expense 13.97 10.85

Operating costs 7.69 7.11


Netback 26.38 33.57



Production averaged 666 barrels of oil equivalent per day ("boepd") during the three months ended March 31, 2007, a 161% increase over the 255 boepd over the three months ended March 31, 2006. Production for the three months ended December 31, 2006 was 369 boepd. Volumes for the month of March 2007 averaged 874 boepd.

During the three months ended March 31, 2007 two new wells were placed on production, one at Hanlan and one at Ricinus. One well at Quaich was completed and tested.

At Hanlan, the 14-35 well was placed on production during February, 2007 and is currently producing about 9.7 million cubic feet per day of raw gas. Tango has a 28% working interest (WI) in this well, subject to a 12.5% non-convertible overriding royalty.

At Ricinus, the 6-9 well has been placed on production during March, 2007 and is currently producing 500 thousand cubic feet per day of raw gas. Tango has a 67.5% WI in this well. Tango acquired 6 sections at the March 7 land sale at an average 67.5% WI.

At Kakwa, the 13-1 Swan Hills well has been drilled and completed. Testing operations were not completed due to wildlife constraints which required all of the equipment to be removed from the lease prior to March 15. As a result, the well has been suspended pending further evaluation of the pressure data. Further operations on the well will not be conducted prior to December, 2007. Tango has a 30% WI in this well.

At Quaich, the 3-3 well was tested and evaluated, and it is expected that the well will be tied into existing facilities once a pipeline can be constructed.

Tango has 27,520 gross (16,150 net) acres of undeveloped land located west of the fifth and sixth meridian within the foothills and deep basin portion of the Western Canadian Sedimentary Basin. Tango continues to post and acquire crown land on new plays, as well as crown land offsetting existing opportunities.

For a copy of Tango's December 31, 2006 Financial Statements and Management Discussion and Analysis please visit www.sedar.com.

Tango Energy Inc. is listed on the TSX-Venture Exchange under the Symbol TEI.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. This release contains forward-looking information. By their nature, forward-looking statements involve assumptions and known and unknown risks and uncertainties that may cause actual future results to differ materially from those contemplated. These risks include such things as volatility of oil and gas prices, commodity supply and demand, fluctuations in currency and interest rates, ultimate recoverability of reserves, timing and costs of drilling activities and pipeline construction, new regulations and legislation and availability of capital. Tango does not undertake to update any such forward-looking statements except as required by law. Please refer to Tango's Annual Report for more detail as to the nature of these risks and uncertainties. Although Tango believes that the expectations represented by these forward looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

Natural gas volumes have been converted to a barrel of oil equivalent ("boe") using six thousand cubic feet equal to one barrel unless otherwise stated. A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. This conversion conforms with Canadian Securities Regulators National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). Boe's may be misleading, particularly if used in isolation.

Funds flow from operations and funds flow from operations per share and netback are not recognized measures under Canadian generally accepted accounting principles. Management believes that these items are a useful measure of financial performance. Funds flow from operations is defined as net income plus non-cash charges including, depletion, depreciation and accretion, future taxes and stock-based compensation, after asset retirement costs. Funds flow from operations per share is calculated by dividing the weighted average number of shares outstanding during the year into funds flow from operations. Netback is the average per unit of volume for oil and gas revenues less royalties and production costs incurred. Netback is expressed in terms of dollars per boe.

Contact Information

  • Tango Energy Inc.
    John M. Gunn
    Chief Executive Officer
    Phone: (403) 266-5688


    Tango Energy Inc.
    John E. Bell
    Phone: (403) 266-5688
    Fax: (403) 266-8817