HOUSTON, Aug. 24, 2007 (PRIME NEWSWIRE) -- Index Oil and Gas, Inc. (OTCBB:IXOG) ("Index" or "the Company") announced today it has filed the Company's unaudited financial results for the Fiscal Quarter ended June 30, 2007 ("Q1 FY 2008", "the quarter"). Form 10-Q ("Quarterly Report") was filed on August 14, 2007 with the Securities and Exchange Commission.
Reported Oil and Gas revenues, while increased a great deal in percentage terms, reflect only existing production. This existing production is expected to increase materially if the High Impact drilling program now under way is successful. Wells in progress at present include Cason 1 (at target depth, completing and testing), Ilse 1 (drilled and awaiting completion and testing), Shadyside (approaching the targeted multiple reservoirs section of the well) and Outlar 1 (drilling). Cow Trap, West 1 and the potentially very large Alligator Bayou prospect are yet to be drilled.
Oil and gas sales rose to $151,373 for Q1 FY 2008, the first quarter of the Company's fiscal year ("FY") 2008, as compared to $70,457 for the quarter ended June 30, 2006 ("Q1 FY 2007"). For the first time, quarterly gas production exceeded oil production, on an equivalent basis, consistent with the Company's gas biased current drilling program.
The increase in oil and gas sales was due primarily to the increase in production volumes of 1.7 MBoe (thousand barrels of oil equivalent), which rose from 1.1 MBoe in Q1 FY 2007 to 2.8 MBoe in Q1 FY 2008. The increase was primarily due to increased production from the Walker well of 1.0 MBoe, the Vieman well of 0.3 MBoe and the Friedrich Gas Unit 1 well of 0.8MBoe, offset by lower oil production in Kansas. Additionally, revenues reflected lower average commodity prices as our average price per Boe (barrel of oil equivalent) decreased by $9.08 in the quarter to $53.66 per Boe from $62.74 per Boe in Q1 FY 2007, reflecting the increased gas volumes within the production mix. Average gas sales price in the quarter was $7.27 per Mcf (thousand cubic feet of gas).
Net loss for Q1 FY 2008 was $(0.437 million) as compared to $(0.319 million) for Q1 FY 2007. The loss for the quarter includes $0.096 million of non-cash stock based compensation costs. Commensurate with increased production volumes, production expenses and depletion costs were higher, offset by an increase in interest income on cash balances compared to the previous year.
The Company invested $1.317 million in capital expenditures on its oil and gas properties in the quarter.
Lyndon West, CEO of the Company, stated, "The results for the first quarter of our fiscal year 2008 were as anticipated. Several of the lower-impact wells that were drilled during FY 2007 contributed production. Four of the potentially higher impact wells, which are the focus of our FY 2008 plan, are currently in progress and we will be releasing an important update on our operations very shortly. Our balanced portfolio of projects is progressing well, and we remain excited by the potential that our FY 2008 strategy provides for our company and our shareholders."
About Index Oil and Gas
Index is a gas-biased oil and gas exploration and production company, with activities primarily in Texas, Louisiana, and Kansas. It has offices in Houston, Texas and Bath, England. Index is focused on efficiently building a broad portfolio of producing properties that it believes to have significant upside potential. The Company has an enviable drilling record and intends to grow its existing asset base and revenues through further investment in the U.S. Index seeks to develop its activities in areas containing prolific petroleum systems set in stable political and economic environments.
To find out more about Index Oil and Gas Inc. (OTCBB:IXOG), visit our website at http://www.indexoil.com.
The statements in the press release that relate to the Company's expectations with regard to the future impact on the Company's results from acquisitions or actions in development are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements in this document may also contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, such statements should not be regarded as a representation by the Company, or any other person, that such forward-looking statements will be achieved. Since the information may contain statements that involve risk and uncertainties and are subject to change at any time, the Company's actual results may differ materially from expected results. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In light of the foregoing, readers are cautioned not to place undue reliance on such forward-looking statements.
Pursuant to a June 1, 2007 agreement, Consulting For Strategic Growth 1, Ltd. ("CFSG1") provides the Company with consulting, business advisory, investor relations, public relations and corporate development service, for which CFSG1 receives cash and/or stock compensation.