Tango Energy Inc.

Tango Energy Inc.

August 17, 2007 23:59 ET

Tango Reports Second Quarter 2007 Financial and Operating Results

CALGARY, ALBERTA--(Marketwire - Aug. 17, 2007) - Tango Energy Inc. ("Tango": TSX VENTURE:TEI) is pleased to report on its unaudited interim financial and operating results for the three and six months ended June 30, 2007.

Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
Financial Results
($000s, except per share amounts)
Gross revenues 3,399 1,457 6,302 2,716
Income (loss) before taxes (85) (322) (427) (295)
Net income (loss) (144) 130 (360) 137
Per share - basic 0.00 0.00 (0.01) 0.00
Per share - diluted 0.00 0.00 (0.01) 0.00
Funds flow from operations 2,303 660 3,657 1,363
Per share - basic 0.05 0.02 0.07 0.03
Per share - diluted 0.05 0.02 0.07 0.03
Additions to property and equipment,
net of proceeds 506 1,893 4,652 6,561
Total assets 40,709 33,261 40,709 33,261
Working capital (deficiency) (6,599) 2,036 (6,599) 2,036
Asset retirement obligation 663 572 663 572
Flow-through share obligations 1,300 3,300 1,300 3,300
Share Data (000s)
Equity outstanding
Common shares 49,530 42,157 49,530 42,157
Stock options and warrants 4,050 2,840 4,050 2,840
Fully diluted 53,580 44,997 53,580 44,997
Sales Volumes (average)
Natural gas (mcf/d) 4,810 2,063 4,310 1,735
Crude oil and liquids (bbls/d) 30 30 31 25
Average boe/d 831 374 749 315
Product Prices (average)
Natural gas ($/mcf) 7.34 6.53 7.59 7.29
Crude oil and liquids ($/bbl) 62.19 71.11 60.43 67.87
Netback Analysis ($/boe)
Oil and gas revenue 44.68 41.70 46.16 45.66
Gathering income 0.19 - 0.26 -
Royalty expense (1.63) (8.71) (7.09) (9.55)
Operating costs (8.58) (8.68) (8.19) (8.04)
Netback 34.65 24.32 31.14 28.07

Sales volumes averaged 831 barrels of oil equivalent per day ("boepd") during the three months ended June 30, 2007, a 25% increase over the 666 boepd over the prior quarter ended March 31, 2007. Production for the six months ended June 30, 2007 averaged 749 boepd, a 138% increase over the 315 boepd for the first six months of 2006.

During the three months ended June 30, 2007 Tango completed a production optimization project in the Ricinus area, conducted additional production testing at Quaich, and commenced ground work for it's late summer, fall and winter operations.

At Ricinus, Tango established that our new well had a condensate loading issue which has been resolved by commingling multiple zones and installing a plunger lift.

At Quaich additional production testing has been completed. The pipeline has been surveyed, and a pipeline application has been filed. Tango is working to get this well tied-in as soon as possible.

Tango has 27,520 gross (16,150 net) acres of undeveloped land located west of the fifth and sixth meridians 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.

During the second quarter, Tango commenced ground work for a busy late summer and fall drilling and re-entry program. At Hanlan, Tango expects to re-enter an existing well and commence drilling an exploratory well. At Ansell, Tango expects to commence drilling operations during the third quarter on an exploratory location on our existing pipeline.

The proceeds of the recently announced equity issue together with funds flow from operations and existing bank lines provides Tango the financial ability to proceed with its exploration and development plans. In addition, Tango's low cost structure provides attractive netbacks at modest natural gas prices.

For a copy of Tango's June 30, 2007 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.

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
    President & CEO
    (403) 266-5688


    Tango Energy Inc.
    David E. Blain
    Vice President, Finance & CFO
    (403) 266-5688
    (403) 266-8817