DALLAS, Feb. 24, 2009 (GLOBE NEWSWIRE) -- Glen Rose Petroleum Corporation (Nasdaq:GLRP), headquartered in Dallas, Texas, reported its results for the third quarter ended December 31, 2008 which showed oil and gas revenue of $96,803 a 33% increase from the prior quarter.
Production and operating expenses were $88,988, for a loss from operations of $2,077,159.
General administrative expenses were $849,232, and the non-cash cost of incentive stock options was $1,093,339, resulting in a net loss for the quarter of $2,076,819, or $0.21 per share.
Accounts payable increased to $562,655, while shareholders' equity from $3,116,495 to $3,262,504, a 5% increase as compared to March 31, 2008.
The Company terminated its Participation Agreement with WHL Energy Limited ("WHL"). The Participation Agreement signed in July 2008, required that WHL pay 100% of the drilling costs, up to $2.5 million, for a 50% working interest in the first 2,546 acres (Phase 1). After funding $1.5 million and participating in the drilling of three wells and the purchase of 5 wells, WHL felt it was in their best interest not to proceed. Mr. Chip Langston, President of Glen Rose, stated, "WHL's non participation is governed by the Participation Agreement, whereby they keep what they earned."
In addition to the wells drilled with WHL, the Company has drilled three wells for its own account outside the joint venture area of interest. We have also drilled two horizontal wells, and we have eight wells permitted to drill in the next few months. We are continuing to improve daily production with nitrogen injection and swabbing to a current production rate of 60 barrels of oil per day.
Mr. Langston said, "The Company geared up its drilling activity in line with the WHL Participation Agreement. After crude oil prices collapsed, we stopped new activities in late November. In these activities we incurred significant accounts payables. Since that time, we have continued to improve daily production, so that the Company is almost cash flow positive from operations, even at these low commodity prices. But, finding outside financing has been difficult. Our major shareholder and corporate financing consultant, Blackwood Ventures LLC has worked diligently in these difficult markets. The Company is in discussions with several individuals and companies on a variety of financing possibilities. To date, none has been signed, and there are no assurances they will be consummated. In the meantime, the Company has entered into a $250,000 convertible debenture with Blackwood, which, has not been funded to date."
The periodic income statement follows. The income statement is modified by and subject to the remainder of the financial statements and the notes to the financial statements which were included in the Form 10-Q filed February 20, 2009 and are available through the SEC's website, www.sec.gov.
GLEN ROSE PETROLEUM CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
December 31, December 31,
------------------------ ------------------------
2008 2007 2008 2007
----------- ----------- ----------- -----------
(Restated) (Restated)
OPERATING REVENUES
Oil and gas sales $ 23,932 $ 24,311 $ 96,803 $ 26,266
----------- ----------- ----------- -----------
TOTAL OPERATING
REVENUES 23,932 24,311 96,803 26,266
----------- ----------- ----------- -----------
OPERATING COSTS AND
EXPENSES
Production and
operating 43,457 21,672 88,988 82,351
Impairment of oil
and gas
properties 130,329 -- 130,329 --
Depreciation and
depletion 4,871 338 8,342 1,014
Accretion of asset
retirement
obligation 1,244 1,244 3,732 3,732
General and
administrative 139,287 1,636,778 849,232 1,998,113
Bad debt expense -- 41,406 -- 243,814
Stock compensation
expense 410,334 -- 1,093,339 --
Put option expense -- 69,728 -- 209,184
----------- ----------- ----------- -----------
TOTAL OPERATING
COSTS AND EXPENSES 729,522 1,771,166 2,173,962 2,538,208
----------- ----------- ----------- -----------
LOSS FROM
OPERATIONS (705,590) (1,746,855) (2,077,159) (2,511,942)
OTHER INCOME
(EXPENSE)
Gain on
forgiveness of
debt -- -- -- --
Gain (Loss) on
sale of
investments -- -- (749) 303,155
Gain on sale of
property and
equipment -- 5,000 -- 13,351
Interest income 1,089 -- 1,089 --
Interest expense -- (2,221) -- (70,117)
----------- ----------- ----------- -----------
Gain (Loss)
before income
tax (704,501) (1,744,076) (2,076,819) (2,265,553)
INCOME TAX BENEFIT -- -- -- --
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ (704,501) $(1,744,076) $(2,076,819) $(2,265,553)
=========== =========== =========== ===========
Income (Loss) per
share (basic) $ (0.07) $ (0.26) $ (0.21) $ (0.35)
=========== =========== =========== ===========
Weighted average
number of shares
(basic) 10,621,562 6,778,886 9,841,345 6,557,931
=========== =========== =========== ===========
Glen Rose Petroleum Corporation has restated its financial statements as of and for the six months ended September 30, 2008 in its Form 10-Q for the period ending December 31, 2008. The restatement was made primarily to reclass certain lease operating expenses that should have been capitalized.
The impact of such restatement to the financial statements as of September 30, 2008 is:
As of September 30, 2008
-----------------------------------------
As Originally Adjustments
Presented (1) As Restated
Consolidated Condensed
Balance Sheet
Total current assets $ 958,731 $ -- $ 958,731
Total assets 6,615,734 178,603 6,794,337
Total current liabilities 3,128,470 18,789 3,147,259
Total liabilities 3,218,876 18,789 3,237,665
Accumulated deficit (47,782,927) 159,814 (47,623,113)
Total stockholder's equity $ 3,396,858 $ 159,814 3,556,672
For Six Months Ended
September 30, 2008
-----------------------------------------
As Originally Adjustments
Presented (1) As Restated
Consolidated Condensed
Statement of Operations
Total revenue $ 72,871 $ -- $ 72,871
Total operating costs and
expenses 1,604,254 (159,814) 1,444,440
Loss from operations (1,531,382) 159,814 (1,371,568)
Net income (loss) (1,532,131) 159,814 (1,372,317)
Net income (loss) per share:
Basic and Diluted $ (0.16) $ (0.14)
1) To reclassify amounts that were reported as lease operating expenses that should have been reported as capital assets. The liabilities were affected due to reclassification of payables. The Company reviewed costs which were charged to operations as lease operating expenses and determined that these expenses should have been capitalized as development cost. This restatement is being made to reflect the proper treatment of these costs.
The Glen Rose Petroleum Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5339
Private Securities Litigation Reform Act Safe Harbor Statement: All statements in this press release that are not statements of historical fact are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as codified in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including any projections of earnings, revenue, cash or other financial items, any statements of the plans, strategies, and objectives of management for future operations, any statements regarding future economic conditions or performance, statements of belief and any statements of assumptions underlying any of the foregoing. These statements are based on expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The risks and uncertainties include our limited capital resources and limited access to financing and the risks and uncertainties inherent in oil and gas exploration, production, and development, and market conditions, particularly energy prices and demand for oilfield equipment and services. Glen Rose Petroleum Corporation assumes no obligation to update these forward-looking statements to reflect future events or actual outcomes and does not intend to do so.