Traverse Energy Ltd.

May 20, 2010 16:39 ET

Traverse Energy Announces 2010 First Quarter Results

CALGARY, ALBERTA--(Marketwire - May 20, 2010) - Traverse Energy Ltd. ("Traverse" or "the Company") (TSX VENTURE:TVL) presents financial and operating results for the three months ended March 31, 2010. Unless otherwise stated, the volume conversion of natural gas to barrel of oil equivalent (BOE) is presented on the basis of 6 thousand cubic feet of natural gas being equal to 1 barrel of oil.

  Three months ended (unaudited)  
  March 31, 2010   Dec. 31, 2009   March 31, 2009  
Financial ($ thousands, except per share amounts)            
Revenue $ 291   $ 156   $ 177  
Net income loss   (145 )   (178 )   (6 )
  Per share – basic and diluted   (0.01 )   (0.01 )   0.00  
Funds flow from operations*   33     (29 )   81  
Net capital expenditures   2,348     1,290     77  
Total assets   10,349     10,241     6,174  
Shareholders' equity   8,351     8,718     5,300  
Working capital   2,243     4,546     2,505  
Common shares                  
  Outstanding (millions)   25.0     24.9     12.9  
  Weighted average (millions)   25.0     24.1     12.9  
Operations (Units as noted)                  
Production (BOE/d)   66     48     54  
  Natural gas (Mcf per day)   230     233     286  
  Oil and NGL (bbls per day)   27     9     6  
Average sale price                  
  Natural gas ($/Mcf)   5.09     4.29     5.77  
  Oil and NGL ($/bbl)   75.84     73.85     44.36  
*Management uses funds flow from operations (before changes in non-cash working capital) to analyze operating performance. Funds flow as presented does not have any standardized meaning prescribed by Canadian Generally Accepted Accounting Principles and therefore may not be comparable with the calculation of similar measures for other entities.

Operations Review

During the first quarter of 2010, Traverse participated in the drilling of four gross (3.4 net) wells and shot additional seismic in two areas. First quarter drilling resulted in one natural gas well (1.0 net), one oil well (0.4 net) and two potential natural gas wells (2.0 net). In addition to equipping the two wells drilled in the first quarter, equipping operations were also completed on the two wells drilled late in 2009. Production from all four wells commenced during the quarter resulting in an average addition of 23 BOE per day for the period.

The Company sold undeveloped non-core lands during the first quarter for $250,000. Undeveloped land holdings at March 31, 2010 included 183,000 gross (173,000 net) acres. All of the Company's oil and gas properties are located in Alberta.

Traverse plans an active drilling program for 2010 which includes up to 12 gross (8 net) wells with an initial budget of $5 to $7 million. The program includes a combination of development and exploratory wells targeting oil and natural gas. Field activities in the second quarter have been restricted due to spring breakup and recent wet weather conditions. Exploration and development activities will largely focus on oil properties in the near term. Several wells targeting natural gas are scheduled for later in 2010.

In the Turin area, where the Company is developing a Sunburst oil pool, Traverse plans to drill 2 gross (1.5 net) wells in the second quarter. If successful with this drilling, the Company will proceed with an expansion to its infrastructure and further drilling locations would then be scheduled. Drilling operations, or evaluation through re-entry of existing wells, are planned in the Little Bow, Long Coulee, Manyberries and Warwick areas of southern and central Alberta.

Further details on the Company, including the 2009 year end audited consolidated financial statements, the related management's discussion and analysis, and the Annual Information Form are available on the Company's website and SEDAR.

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

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