New York, NY, July 31st, 2018 Petro River Oil Corp. (PTRC) (“Petro River” or the “Company”) is pleased to announce its year end April 30, 2018 financials and 2018 guidance.
- 1,131% increase in oil and gas production this year from the fiscal year ending April 30, 2017. Company production has been ramping up, with more than 60% of this new production occurring in the fourth quarter.
- 395% increase in proved and probable reserves this year per the May 1, 2018 evaluation (“Reserve Report”) by Cawley, Gillespie & Associates, an independent engineering firm.
- 11.27% decrease in general and administrative expenses this fiscal year.
The Company recorded annual revenues of $723,409 on oil and gas sales for the fiscal year, with $447,491 earned in the fourth quarter ending April 30, 2018. Most of this revenue is derived from the Company's first oil field discovery, the West Blackland field, in Osage County, Oklahoma. By the end of the fourth quarter ending April 30, 2018, the Company had ten producing wells in the West Blackland field. The success of these wells marks a significant turning point in the Company's history.
The Company posted a net loss of approximately $20.5 million or ($1.25) per share for its fiscal year ending April 30, 2018, attributable primarily to the following one-time charges: (i) a $11.9 million loss resulting from the redemption of the Megawest interest in January 2018, (ii) an accounting loss of $3.4 million from the Company's acquisition of an additional 46.81% interest in the Company's Osage County project in November 2017, and (iii) a $1.7 million loss due to impairment of non-producing assets outside of Osage County. The Company does not anticipate that similar charges will occur in its fiscal year ending April 30, 2019. Operational Update and 2018 Guidance
Following our fiscal year ended April 30, 2018, the Company has successfully drilled three additional wells and discovered two new oil fields in Osage County, Oklahoma: the North Blackland field and the Arsaga field. Two of these new wells have delineated both ends of the North Blackland field in Osage County. The Blackland 2-34 and 2-35 wells encountered a combination of both Mississippian Chat and Burgess “pay,” which has resulted in increased production rates. Based on the Reserve Report, the 2-34 well has estimated ultimate recoveries of 127,900 barrels of oil equivalent. The Company plans to drill an additional eight wells in the North Blackland field in 2018 using current cash flow.
The success of the Company's most recent exploration well, the Arsaga 25-2, was announced earlier this month. Preliminary results indicate 30 feet of productive Mississippian Chat formation, with an estimated ultimate recovery of 50,655 barrels of oil equivalent based on the Reserve Report. The Arsaga field is our largest oil field discovery with approximately 2,000 prospective acres and up to 100 well locations.
Based on current production from our existing wells, the Company's operations have turned cash flow positive during the current first quarter ending July 31, 2018. The Company expects to achieve positive net income at the conclusion of the Company's Fall 2018 drilling program, which will include eight additional wells in the North Blackland field and two additional wells in the Arsaga field. It is currently anticipated that the Company's Fall 2018 drilling program will be funded entirely from current cash flow. With the success of the Arsaga field, and the West and North Blackland fields, the Company currently anticipates significant cashflow from oil and gas production in 2019.
“We are very pleased with our ability to restructure the Company and move towards a path of profitability by the end of 2018. The one-time charges reflected in this fiscal year cleaned up our balance sheet, and upon completion of our 2018 drilling plans, we believe that we will be in position to recognize significant net profits for our next fiscal year,” stated Stephen Brunner, President of Petro River.
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