-- Third quarter net loss of $13.3 million, versus net earnings of
$2.1 million in the prior-year period.
-- Net loss reflects higher exploration costs, lower natural gas and crude
oil prices and hurricane-related shut-ins in Gulf of Mexico.
-- Production from core areas increased 25 percent from prior-year quarter
to 31.8 MBOE per day, excluding Patina.
-- Discretionary cash flow of $14.9 million represents 18 percent increase
over 1997 third quarter, excluding Patina and special items.
FORT WORTH, Texas, Nov. 5 /PRNewswire/ -- Snyder Oil Corporation ("SOCO")
(NYSE: SNY) today reported that a 25 percent production increase from core
operating areas in the third quarter 1998 contributed to a 6 percent revenue
gain and an 18 percent increase in discretionary cash flow, despite the
negative impact of declining oil and natural gas prices and storm-related
shut-ins in the Gulf of Mexico.
For the third quarter of 1998, the Company reported a net loss of
$13.3 million (40 cents per share) compared to net income of $2.1 million
(7 cents per share) for the third quarter of 1997, including special items and
Patina's operations. Excluding special items and Patina's operations, the
Company incurred a net loss of $15.4 million (46 cents per share) in the third
quarter of 1998 compared to a net loss of $6.9 million (23 cents per share) in
the third quarter of 1997. The decline reflects the negative impact of higher
exploration expenses, 15 percent lower oil and natural gas prices and
weather-related problems in the Gulf of Mexico.
Unless stated otherwise, all results in the text of this release compare
ongoing operations and exclude special items and the operations of the
Company's former majority-owned subsidiary, Patina Oil & Gas Corporation,
which was sold at the end of the third quarter 1997. The accompanying tables
reflect both the historically reported amounts along with the special items
segregated.
Third quarter 1998 revenues increased to $32.6 million compared with
$30.9 million in the same prior-year period. Production increased 25 percent
to an average 31.8 MBOE (thousand barrel oil equivalent) per day from
25.5 MBOE per day in the third quarter 1997.
Average oil prices fell 41 percent to $10.31 per barrel in third quarter
1998 from $17.57 in the prior-year third quarter. The average price for
natural gas dropped to $1.89 per mcf during the quarter, compared with an
average $1.99 per mcf a year earlier. A 17 percent increase in the Rocky
Mountain realized natural gas price to $1.61 per mcf during the third quarter
helped offset a 24 percent decrease in the Offshore realized price to
$1.78 per mcf. A 17 cent per mcf hedging gain during the third quarter 1998
softened the overall impact of lower gas prices, resulting in a realized price
decrease of only 5 percent.
Cash costs per BOE decreased 12 percent to $6.18 in the third quarter 1998
from $7.04 in the prior-year period. By increasing production, protecting our
prices through an effective hedging program, and reducing our cash costs per
BOE, discretionary cash flow increased by 18 percent to $14.9 million compared
with $12.7 million in the previous year's quarter.
Chairman and Chief Executive Officer John C. Snyder commented, "Weather
and commodity prices had a major impact on our third quarter results.
Weather-related production shut-ins and curtailments during the third and
fourth quarters, along with some disappointing well results, will limit our
targeted production increases for the year. An area for encouragement, within
this difficult industry environment, is the acquisition front, where
opportunities are improving and the Company has a $150 million borrowing base
available under its bank line to support future growth."
Exploration spending during the quarter totaled $24.7 million, compared
with $7.2 million in the prior-year period. The Company incurred
$16.8 million of dry hole costs in the third quarter of 1998, including the
previously announced $10 million dry hole at Raven South (Garden Banks Block
625) and Mosquito Hawk (Garden Banks Block 269), both in the Gulf of Mexico
Flex Trend. The Company's success rate now stands at 50 percent for the first
six tests in its Flex Trend program. During the quarter, the Company drilled
32 wells.
The Company has elected to sidetrack the Bozeman No. 1, Winn Parish,
Louisiana, which is the Company's first pinnacle reef test in its north
Louisiana exploration program. The Company has previously announced
completion of leasing acreage covering 40 reef prospects identified from its
three proprietary 3-D seismic surveys.
"We received positive indications from our first reef test in north
Louisiana during the quarter proving the presence of reefs and our ability to
delineate them with 3-D seismic. This boosts our optimism about the reef play
and heightens our anticipation about getting this first prospect tested,"
commented William G. Hargett, President and Chief Operating Officer. "We are
disappointed in the higher exploration expense in the third quarter, but we
still expect the Company's overall finding and development costs for the year
to be approximately $5 per barrel. Our strategy is to balance our higher
risk, higher potential projects with our more predictable development projects
in growing our reserve base."
Snyder Oil Corporation is engaged in the production, development,
acquisition and exploration of domestic oil and gas properties, primarily in
the Gulf of Mexico, the Rocky Mountains and northern Louisiana. The Company
also has investments in two international exploration and production
companies, SOCO International plc and Cairn Energy plc. The Company's shares
are traded on the New York Stock Exchange under the symbol "SNY." The
Company's news releases and other information can be found on the Internet at
http://www.snyderoil.com.
This release contains certain forward-looking statements which are based
on assumptions which the Company believes are reasonable, but which are
subject to a wide range of uncertainties and business risks. Factors that
could cause actual results to differ materially from those anticipated are
discussed in the Company's periodic filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K for the year ended
December 31, 1997.
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
Nine Months Ended September 30,
Excluding As
Patina Reported
1998 1997 1997
Summary Statement of Operations
Oil and gas sales $100,039 $95,627 $168,992
Cash expenses
Direct operating 28,374 26,144 39,651
General and administrative 12,233 12,193 15,990
Financing costs, net 9,265 8,175 20,648
Other (income) expense (1,287) 1,289 611
Preferred dividends -- 4,648 4,648
Discretionary cash flow 51,454 43,178 87,444
Depletion, depreciation and
amortization 39,674 32,011 68,274
Property impairments -- 5,125 5,125
Exploration 35,192 12,482 12,602
(23,412) (6,440) 1,443
Current income tax expense -- 500 500
Deferred income tax benefit (8,194) (1,126) (1,126)
Net income (loss) before special
items (15,218) (5,814) 2,069
Special items (net of deferred
taxes)
Gains on sales of equity interests
in investees -- 21,320 21,320
Gains on sales of properties 2,967 5,633 5,633
Extraordinary item, net of tax -- (2,848) (2,848)
Minority interest in subsidiaries -- (616) (4,119)
Net income (loss) applicable to
common $(12,251) $17,675 $22,055
Net income (loss) per common share $(.37) $.59 $.73
Discretionary cash flow per common
share $1.54 $1.43 $2.90
Weighted average shares outstanding 33,443 30,121 30,121
Summary Operations Data
Oil production (Bbl/day) 5,301 5,724 10,999
Gas production (Mcf/day) 151,004 110,056 184,271
Equivalent barrels (BOE/day) 30,468 24,067 41,711
Equivalent cubic feet (Mcfe/day) 182,808 144,402 250,265
Average oil price (per Bbl) $11.46 $18.67 $19.21
Average gas price (per Mcf) $2.02 $2.21 $2.21
Average price per BOE $12.03 $14.55 $14.84
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
Three Months Ended September 30,
Excluding As
Patina Reported
1998 1997 1997
Summary Statement of Operations
Oil and gas sales $32,636 $30,904 $52,156
Cash expenses
Direct operating 10,586 8,942 13,127
General and administrative 3,927 3,992 5,178
Financing costs, net 3,596 3,591 7,579
Other (income) expense (393) 144 (307)
Preferred dividends -- 1,548 1,548
Discretionary cash flow 14,920 12,687 25,031
Depletion, depreciation and
amortization 13,987 10,815 22,302
Property impairments -- 4,500 4,500
Exploration 24,674 7,154 7,212
(23,741) (9,782) (8,983)
Current income tax expense -- -- --
Deferred income tax benefit (8,309) (2,881) (2,881)
Net loss before special items (15,432) (6,901) (6,102)
Special items (net of deferred taxes)
Gains (losses) on sales of equity
interests in investees -- (108) (108)
Gains on sales of properties 2,120 2,485 2,485
Gain on sale of subsidiary interest -- 6,500 6,500
Minority interest in subsidiaries -- (1) (690)
Net income (loss) applicable to
common $(13,312) $1,975 $2,085
Net income (loss) per common share $(.40) $.07 $.07
Discretionary cash flow per common
share $.45 $.43 $.85
Weighted average shares outstanding 33,461 29,504 29,504
Summary Operations Data
Oil production (Bbl/day) 5,358 5,596 10,542
Gas production (Mcf/day) 158,865 119,499 190,942
Equivalent barrels (BOE/day) 31,835 25,513 42,366
Equivalent cubic feet (Mcfe/day) 191,010 153,077 254,194
Average oil price (per Bbl) $10.31 $17.57 $18.09
Average gas price (per Mcf) $1.89 $1.99 $1.97
Average price per BOE $11.14 $13.17 $13.38
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
September 30, December 31,
1998 1997
Summary Balance Sheet Data
Cash and equivalents $6,322 $89,443
Other current assets 32,137 24,432
Investments 34,273 143,066
Oil & gas properties and other
long-term assets 357,232 289,147
$429,964 $546,088
Current liabilities $77,306 $57,549
Long-term debt 173,752 173,636
Other noncurrent liabilities 19,101 51,147
Stockholders' equity 159,805 263,756
$429,964 $546,088
SOURCE Snyder Oil Corporation
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http://www.snyderoil.com
Company News On-Call:
http://www.prnewswire.com/comp/118962.html or fax,
800-758-5804, ext. 118962
CONTACT:
Rodney L. Waller of Snyder Oil Corporation,
817-882-5937
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