CALGARY, ALBERTA--(Marketwire - June 28, 2011) -
Tuscany Energy Ltd. (
News -
Market indicators) is pleased to report improved first quarter operating and financial results, the closing of its amalgamation with Sharon Energy Ltd, the commencement of a four well heavy oil development program and the sixth successful Dina well at Evesham.
On June 2nd, the Company completed a business combination with Sharon Energy Ltd. Tuscany acquired all of the issued and outstanding common shares of Sharon on the basis of 0.84 of a common share of Tuscany for each one common share of Sharon.
A pro forma balance sheet, effective March 31, 2011, for the combined entity shows available cash of $4.5 million, a liquid investment in Magnum Hunter stock valued at $3.3 million based on June 21st prices, and an available undrawn bank line of $4.6 million. This new financial strength is now being utilized in an expanded heavy oil development program at Evesham, Saskatchewan.
For the quarter, Tuscany's revenue increased by 30% to $989,000 and cash flow from operations improved by 92% to $429,000.
Improved financial results were driven by the December 2010 addition of two new Evesham heavy oil wells which produced during the first quarter.
During the second half of 2011, Tuscany will focus on developing its Dina oil property at Evesham. Tuscany plans to increase the pace of investment and development at Evesham with six new wells planned. Initial drilling of a four well program commenced in early June with the first well successfully drilled and cased and the drilling of a second well underway. Tuscany expects all four wells to be producing during the month of July which should improve third quarter operating and financial results.
Financial and Operating Results
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(Thousands, except shares and per share amounts, Three Months Ended
unaudited) March 31
2011 2010
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Financial
Revenue $ 989 $ 762
Cash flow from operations(i) 429 232
per share, diluted 0.01 0.00
Earnings (Loss) for the period (300) (119)
per share, diluted 0.00 (0.02)
Net capital additions 397 447
Net debt 4,169 2,972
Total assets 12,063 10,678
Total shares outstanding at period end 62,801,825 55,091,825
Operations
Production
Gas (Mcfd) 123 200
Oil (Bopd) 171 119
BOEd (6 Mcf = 1 Bbl) 192 152
Product Prices
Gas ($/Mcf) $ 2.98 $ 4.94
Oil ($/Bbl) $ 62.05 $ 67.51
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For further information on Tuscany's first quarter results please review the Company's Financial Statements and MDA filed on SEDAR at
www.sedar.com or the view the Company's Interim Q1 2011 report found on the Company's website at
www.tuscanyenergy.com.
ADVISORY: Certain information regarding the Company in this News Release including management's assessment of future plans and operations may constitute forward-looking statements under applicable securities laws and necessarily involve risks including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, capital expenditure costs, including drilling, completion and facilities costs, unexpected decline rates in wells, wells not performing as expected, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhausted. Additional information on these and other factors that could effect the Company's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (
www.sedar.com) and at the Company's website (
www.tuscanyenergy.com). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Where amounts are expressed on a barrel of oil equivalent (boe) basis, natural gas volumes have been converted to barrels of oil at six thousand cubic feet (mcf) per barrel (bbl). Boe figures may be misleading, particularly if used in isolation. A boe conversion of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. References to oil in this discussion include crude oil and natural gas liquids (NGLs).
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Tuscany Energy Ltd.
Robert W. Lamond
Chairman & CEO
(403) 269-9889
(403) 269-9890 (FAX)
or
Tuscany Energy Ltd.
Donald K. Clark
Vice President Operations
(403) 269-9889
(403) 269-9890 (FAX)
www.tuscanyenergy.com 
