Voyager Oil & Gas, Inc. Reports Record Quarterly Production Volumes and Adjusted EBITDA for Its First Quarter Ended March 31, 2012

BILLINGS, Mont., May 8, 2012 (GLOBE NEWSWIRE) -- Voyager Oil & Gas, Inc. (AMEX:VOG) ("Voyager" or the "Company") announces record oil production, revenue and Adjusted EBITDA* for the first quarter ended March 31, 2012. The final unaudited Quarterly Report will be released and filed on or about May 8, 2012.

First Quarter 2012 Highlights

• Record quarterly oil production of 56,865 barrels of oil equivalent (BOE), or an average of 625 barrels of oil equivalent per day (BOEPD). Production was back-end loaded with 24,528 BOE produced during the month of March. First quarter production was up 56% from 36,564 BOE (397 BOEPD) in the previous quarter ended December 31, 2011;
   
• Record oil and natural gas sales of $5,098,333 (99% of which is attributable to the sale of crude oil), up 67% from $3,054,299 in the fourth quarter ending December 31, 2011;
   
• Adjusted EBITDA* of $3,483,733 up 82% from $1,912,966 in the quarter ended December 31, 2011; and
   
• Adjusted income* of $628,522 or $0.01 per share for the three months ended March 31, 2012.

* Non-GAAP financial measure. Please see Adjusted EBITDA and Adjusted Income tables later in this earnings release for a reconciliation of these measures to their nearest comparable GAAP measure.

First Quarter 2012 Financial Results

During the quarter ended March 31, 2012, Voyager reports oil and natural gas sales of $5,098,333, which represents an increase of 67% from $3,054,299 during the fourth quarter ending December 31, 2011 and an increase of 512% from $832,621 in the year ago quarter ended March 31, 2011. This increase in revenue is due primarily to production from 118 gross (5.03 net) wells producing in the Bakken and Three Forks formations as of March 31, 2012, compared to 82 gross (2.99 net) wells and 11 gross (0.48 net) wells producing in the same formations as of December 31, 2011 and March 31, 2011, respectively. Production accelerated throughout the quarter with 43% of the quarterly production (24,528 BOE or about 800 BOEPD) during the month of March. Crude oil represented 99% of revenue and 96% of production during the first quarter 2012.

As of March 31, 2012, Voyager had interests in a total of 160 gross (7.05net) wells in the Bakken and Three Forks formations, of which 118 gross (5.03 net) wells were producing and 42 gross (2.02 net) wells were in the process of being drilled or completed.  Permits continue to be issued for drilling units in which Voyager has acreage interests within North Dakota and Montana, and activity in the Williston Basin remains strong.

Adjusted EBITDA for the first quarter 2012 was a record $3,483,733, up 82% from $1,912,966 during the fourth quarter ended December 31, 2011 and up 1,183% from $271,476 during the first quarter ended March 31, 2011. The increase in adjusted EBITDA was driven by increased production and improved leverage over operating expenses. Adjusted EBITDA per BOE for the quarter ended March 31, 2012 was $61.26, compared to $52.32 during the fourth quarter ended December 31, 2011 and $26.45 during the year ago quarter ended March 31, 2011.

Liquidity

As of March 31, 2012, Voyager had $4,939,616 in cash and total debt outstanding of $17,545,779. Voyager has a credit facility with Macquarie Bank Limited ("Macquarie") that provides up to a maximum of $150 million in principal amount of borrowings to be used as working capital for exploration and production operations. As of March 31, 2012, $15,000,000 was outstanding under Voyager's Tranche A credit facility and $2,545,779 was outstanding under our Tranche B facility with a total of $50 million available through Tranche B. The Company continues to fund its growth with cash flow from operations and using its existing credit facility with Macquarie.

Management Comments

J.R. Reger, Voyager's Chief Executive Officer, commented, "We are pleased to announce another record quarter for Voyager. During the first quarter of 2012 we acquired additional acreage, all of which has already received AFEs, and we expect they will soon be adding to production over the next few quarters. We are focused on increasing production and accelerating operating cash flow and are benefiting from the more than 215 rigs drilling in the Bakken and Three Forks formations that are converting our assets into held by production acres and producing wells. We continue to see opportunities to grow our assets and are committed to providing returns to our shareholders."

Recent Well Completions

The following table illustrates certain recent well completions in which Voyager has participated with a working interest during the first quarter of 2012:

Current Drilling Activity

The following table illustrates the 42 gross (2.02 net) wells in the Bakken or Three Forks formations drilling, awaiting completion or completing in which Voyager is participating with a working interest as of March 31, 2012:

Non-GAAP Financial Measures

Adjusted EBITDA

In addition to reporting net income (loss) as defined under GAAP, Voyager also presents net earnings before interest, income taxes, depreciation, depletion, and amortization, accretion of discount on asset retirement obligations, unrealized gain (loss) from mark-to-market on commodity derivatives and non-cash expenses relating to share based payments recognized under ASC Topic 718 ("Adjusted EBITDA"), which is a non-GAAP performance measure. Adjusted EBITDA consists of net earnings after adjustment for those items described in the table below. Adjusted EBITDA does not represent, and should not be considered an alternative to GAAP measurements, such as net income (loss) (its most directly comparable GAAP measure), and Voyager's calculations thereof may not be comparable to similarly titled measures reported by other companies. By eliminating the items described below, Voyager believes the measure is useful in evaluating its fundamental core operating performance. Voyager also believes that Adjusted EBITDA is useful to investors because similar measures are frequently used by securities analysts, investors, and other interested parties in their evaluation of companies in similar industries. Voyager's management uses Adjusted EBITDA to manage its business, including in preparing our annual operating budget and financial projections. Voyager's management does not view Adjusted EBITDA in isolation and also uses other measurements, such as net income (loss) and revenues to measure operating performance.

The following table provides a reconciliation of net income (loss) to Adjusted EBITDA for the periods presented:

Adjusted Income

In addition to reporting net income (loss) as defined under GAAP, Voyager also presents net earnings before the effect of unrealized gains and loss from mark-to-market on commodity derivatives ("adjusted income"), which is a non-GAAP performance measure. Adjusted income consists of net earnings after adjustment for those items described in the table below. Adjusted income does not represent, and should not be considered an alternative to GAAP measurements, such as net income (loss), and Voyager's calculations thereof may not be comparable to similarly titled measures reported by other companies. By eliminating the items described below, Voyager believes the measure is useful in evaluating its fundamental core operating performance. Voyager also believes that adjusted income is useful to investors because similar measures are frequently used by securities analysts, investors, and other interested parties in their evaluation of companies in similar industries. Voyager's management uses adjusted income to manage our business, including in preparing Voyager's annual operating budget and financial projections. Voyager's management does not view adjusted income in isolation and also uses other measurements, such as net income (loss) and revenues to measure operating performance. The following table provides a reconciliation of net income (loss), to adjusted income for the periods presented:

Derivative Instruments and Price Risk Management

The Company utilizes commodity costless collars (purchased put options and written call options) to (i) reduce the effects of volatility in price changes on the oil commodities it produces and sells, (ii) reduce commodity price risk and (iii) provide a base level of cash flow in order to assure it can execute at least a portion of its capital spending.

All derivative positions are carried at their fair value on the condensed balance sheet and are marked-to-market at the end of each period. Both the unrealized and realized gains and losses resulting from the contract settlement of derivatives are recorded in the loss on derivatives line on the condensed statement of operations.

The Company realized a loss on settled derivatives of $27,543 and a loss on mark-to-market of derivatives instruments of $884,892 for the three months ended March 31, 2012. The Company did not enter into derivative instruments prior to 2012.

Costless collars are used to establish floor and ceiling prices on anticipated oil and natural gas production. There were no premiums paid to or received by the Company related to the costless collar agreements.  The following table reflects open costless collar agreements as of March 31, 2012.

About Voyager Oil & Gas

Voyager Oil & Gas, Inc. combines low overhead, organic acreage acquisition and strong joint venture relationships to exploit its oil and gas prospects. Voyager is an exploration and production company focused on acquiring acreage in prospective natural resource plays in the continental United States. The Company's primary business is focused on properties in North Dakota and Montana targeting the Bakken and Three Forks formations. Voyager currently controls approximately 144,000 net acres in the following five primary prospect areas:

• 33,000 core net acres targeting the Bakken/Three Forks in North Dakota and Montana;
• 2,400 net acres targeting the Niobrara formation in Colorado and Wyoming;
• 800 net acres targeting a Red River prospect in Montana;
• 33,500 net acres in a joint venture targeting the Heath Shale formation in Musselshell, Petroleum, Garfield and Fergus Counties of Montana; and
• 74,700 net acres in a joint venture in and around the Tiger Ridge natural gas field in Blaine, Hill and Chouteau Counties of Montana.

If you would like to receive timely information on Voyager Oil & Gas when it hits the newswire, you may sign up for Voyager's email news alert system today at: http://www.VYOG-IR.com. For additional information on Voyager Oil & Gas visit the Company's new website at: http://www.voyageroil.com/.

SAFE HARBOR

This press release contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933 and the Securities Exchange Act of 1934. All statements other than statements of historical facts included in this report, such as statements regarding our future expectations to increase our production are forward-looking statements (often, but not always, using words such as "expects", "anticipates", "plans", "estimates", "potential", "possible", "probable", or "intends", or stating that certain actions, events or results "may", "will", "should", or "could" be taken, occur or be achieved). Forward-looking statements are based on our current expectations and assumptions about future events and involve inherent risks and uncertainties. These risks include, but are not limited to, the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition and government regulation or other actions. Additional information on these and other factors which could affect Voyager's operations or financial results are included in Voyagers' reports on file with the Securities and Exchange Commission. Such factors (many of which are beyond our control) could cause actual results to differ materially from those set forth in the forward-looking statements.. Readers should not place undue reliance on any such forward-looking statements, which are made only as of the date hereof. Voyager undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in Voyager's expectations.