SOURCE: Xtreme Oil and Gas

Xtreme Oil and Gas

April 02, 2012 08:30 ET

Xtreme Oil & Gas Announces 2011 Financial Results

PLANO, TX--(Marketwire - Apr 2, 2012) - Xtreme Oil & Gas, Inc. (OTCQB: XTOG) (OTCBB: XTOG), an independent energy company engaged in the exploration, development, and production of crude oil, today announced annual revenue of approximately $2.5 million, compared to approximately $90,000 for the fiscal year 2010. Operating profit for 2011 increased to approximately $649,000, compared to a loss of $7 million in 2010.

"During the previous year Xtreme Oil & Gas achieved numerous milestones," stated Mr. Willard G. McAndrew III, CEO of Xtreme Oil & Gas, Inc. "We are pleased to have achieved an operating profit and excited to utilize these gains in fueling growth across both business lines. Management has successfully transitioned ourselves from a start-up to an emerging oil producing company with several profitable revenue streams. The Company has enhanced its market position via the recovery of both oil and natural gas from owned properties in Texas and Oklahoma. The successful extraction of resources from our owned properties is a direct result of management's commitment to our proven drilling methods. These developments are extremely encouraging as Xtreme and its partners we will implement the same methodology at our Kansas property in the near-term."

Mr. McAndrew III continued, "During 2011 we made investments to increase our production at our Texas and Oklahoma properties that will lead to continued growth in 2012. We also progressed in our high-margin saltwater disposal business and have recently completed construction of our saltwater disposal facility. We have received Letters of Intent to dispose up to 15,000 barrels of saltwater per day from AMEREX and Southern Wellhead. Management believes that this business line will provide an additional $7 million in revenue for each well when it reaches full volume. Recent oil production in Texas and Oklahoma combined with anticipated recovery in Kansas and growth of our salt water disposal business strongly positions us for increased earnings, improved margins, and enhanced shareholder value."

Recent Operational Highlights

  • The Company has begun oil production at its 1,200 acre 5 Star West Thrifty Texas property.
    • The site has previously produced over 8 million barrels of oil, and new drilling techniques, completion and chemical technologies are expected to recover remaining reserves.
  • Xtreme began oil production from their first Well site in Oklahoma.
    • The first well has produced 20,000 barrels of oil, and is continuing output at 150 barrels per day.
    • Additionally, the well has produced 60,000 mcf of gas at a rate of 700 mcf per day.
  • The Company initiated disposal operations on its first Saltwater Disposal Well in Oklahoma and is moving into full commercial operation with an initial goal of disposing of 3,000 barrels per day
    • Management expects to increase the amount to 15,000 barrels per day during the course of 2012 with the potential for $7 Million in annual revenue.
  • Xtreme reached a vertical drilling depth of over 3,000 feet and drilled 4,250 feet horizontally on the first well in Kansas and has utilized specialized techniques to perform hydraulic fracturing of the formation.
    • This is the first well to be drilled on the Company's 8,516 acre Kansas property.

Twelve Month Financial Results for the period ended December 31, 2011

Revenue for the year ended December 31, 2011, was $2,493,873 compared to revenue of $89,835 for year ending 2010. The increase was primarily due to revenues realized from completing drilling on our saltwater disposal well and completing our Five Star project on the West Thrifty property in Texas.

Oil production expenses totaled $194,848 and $241,896 for the years ended December 31, 2011 and 2010, respectively. Loss on disposal of properties totaled $48,356 for the year ended December 31, 2011 and was directly related to our attempts to recover damages on the Lionheart property. We continued to operate the West Thrifty and Quita properties and invest in improving field operations to properly maintain and improve our production efficiency. Production costs exceeded revenues because of higher costs of maintenance and repairs.

General and administrative expenses totaled $1,722,180 for the year ended December 31, 2011, a decrease of approximately $4,700,000 from $6,443,746 for the year ended December 31, 2010. This decrease in general and administrative expenses in 2011 is largely driven by our reduced reliance on the issuance of common stock for consulting services and for employees.

For the year ending December 31, 2011, the company had net losses before tax of $325,088 compared with net losses of $7,079,703 for 2010. These losses were primarily due to stock based compensation charges, issuances of common stock for services, and non-cash charges for the issuance of convertible debt and warrants in September 2011. For the year ending December 31, 2011 our losses per share on a fully diluted basis was $0.01 compared to losses of $0.17 per share on a fully diluted basis for the year ending December 31, 2010.

The Company believes it is useful to consider this non-GAAP measure as it excludes significant onetime accounting charges related to the Notes and Warrants we issued during the third quarter.

About Xtreme Oil & Gas
Xtreme Oil & Gas, Inc. is a rapidly growing Dallas-based independent energy company engaged in the exploration, development, acquisition, and production of crude oil and natural gas with operations from properties it owns in Texas, Oklahoma, and Kansas. The company's oilfield services disposes of saltwater for independent energy producers.

Forward-Looking Statements
Statements included in this release related to Xtreme Oil & Gas, Inc. constitute or may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks and uncertainties such as the inherent uncertainty of finding and developing oil and gas properties, the technological and financial difficulties inherent in these activities, the price of hydrocarbons and the Company's ability to estimate accurately net revenues due to variability in size, scope and duration of projects. Further information on potential risk factors that could affect the Company's financial results can be found in the Company's reports filed with the Securities and Exchange Commission.

Contact Information

  • Contact:

    Company
    Xtreme Oil & Gas, Inc.
    (214) 432-8002
    www.xtoginc.com

    Investors
    Alliance Advisors
    Alan Sheinwald
    212-398-3486