Sterling Reports Net Loss in Second Quarter 2007
Sterling Resources reports its results for the second quarter ended June 30, 2007. The net loss for the quarter was $0.7 million compared to $0.6 million in the second quarter of 2006 (both periods $0.01 per common share basic and diluted). For the six months ended June 30, 2007 the net loss was $1.1 million compared to $1.0 million in 2006 (both periods $0.01 per common share basic and diluted). Capital expenditures for the second quarter were $0.9 million compared to $4.5 million in the second quarter of 2006. For the six months ended June 30, 2007 capital expenditures were $3.3 million compared to $7.8 million in the first half of 2006. Working capital at June 30, 2007 was $17.7 million compared to $21.1 million at June 30, 2006.
Highlights for the quarter included the following:
In the Southern North Sea offshore UK Sterling concluded the previously announced farm out agreement with RegEnersys under which they will acquire a 15-percent interest in Blocks 42/12 and 42/13 which contain the Breagh gas discovery. Sterling has a 50-percent working interest in this well and is carried for the majority of the costs on the Breagh appraisal well, which is expected to spud late in the third quarter.
In the Central North Sea, the Constance exploratory well commenced operations on August 10 and is drilling ahead. Previously the well was planned for November. Sterling has a 35-percent interest in this well, which lies within Block 21/23a, to the north and east of the Sheryl oil discovery drilled in 2006.
In the Northern North Sea, Sterling signed an agreement with Revus Energy AS to farm out a portion of UK offshore License P1064 comprising Blocks 210/29a and 210/30a. After giving effect to this arrangement, Sterling retains a 39.9-percent working interest and is in discussion with other potential partners and turnkey drilling operators.
Onshore Romania, Sterling has a 60-percent working interest and operates the 1.5-million acre South Craiova concession. Current work is focused on the Goshawk area and up to six locations has been identified for testing shallow Tertiary gas prospects. It is anticipated that up to three of these wells will be brought to drilling status in 2007 with the first well timed for later this year.
Offshore Romania, Sterling is the operator and holds a 100-percent working interest in the Pelican Block X111 and the Media Block XV, which together comprise approximately 1.1-million acres and contain several mapped prospects as well as the Doina gas discovery. Engineering studies relating to the possible development scenarios for the Doina gas trend have been initiated and the process of farming out a portion of Sterling's working interest continues with agreement expected during the third quarter.
On May 23, 2007 Mr. Walter DeBoni was appointed Chairman of the Board of Directors succeeding Mr. Bob Welty who retired from the Board. Mr. DeBoni has more than 30 years experience in the oil and gas industry and has held numerous executive positions with both domestic and international corporations.
Mr. Stewart Gibson, CEO, said "The second quarter has been a busy one with several key activities including completing farm-out arrangements and preparations for the drilling of the upcoming Breagh appraisal well on Block 42/13 and the Constance well on Block 21/23a in the third quarter. In Romania our plans are progressing for drilling both onshore and offshore later in 2007 or 2008."
- Britain's Breagh Gas Field Back Up after 7 Week Closure (Dec 30)
- Production at UK Breagh Gas Field to Resume in 6-8 Weeks (Nov 20)
- UK's Breagh Gas Field Shut, Maybe for Two Weeks - Sterling (Nov 13)