Contango Tags $72.5MM for GOM Exploration

Contango Oil & Gas reported revenues from sales of natural gas, oil and natural gas liquids for the three months ended December 31, 2009 of approximately $46.1 million, compared to $45.5 million for the same period last year. The Company reported net income attributable to common stock for the three months ended December 31, 2009 of approximately $19.1 million, or $1.21 per basic share and $1.18 per diluted share. This compares to net income attributable to common stock for the three months ended December 31, 2008 of $18.9 million or $1.14 per basic share and $1.12 per diluted share.

For the six months ended December 31, 2009, the Company reported revenues from sales of natural gas, oil and natural gas liquids of approximately $81.6 million, compared to $118.2 million for the same period last year. The Company reported net income attributable to common stock for the six months ended December 31, 2009 of approximately $32.6 million, or $2.06 per basic share and $2.02 per diluted share. This compares to net income attributable to common stock for the six months ended December 31, 2008 of $49.8 million or $2.98 per basic share and $2.92 per diluted share.

Contango's capital expenditure budget for the remainder of calendar year 2010 calls for an investment of approximately $72.5 million to drill up to six offshore wells in the Gulf of Mexico, $14.0 million to complete, build a platform, lay a pipeline, build facilities and bring our Nautilus discovery to production, $19.2 million to continue drilling onshore wells in Panola County, Texas under our joint venture with Patara Oil & Gas LLC, $3.0 million to drill up to two conventional onshore Texas prospects and $1.5 million to plug and abandon Grand Isle 72.

Our production is currently approximately 85.0 million cubic feet equivalent per day, net to Contango. As of February 9, 2010, we had no debt and approximately $75.0 million in net cash and cash equivalents.

Kenneth R. Peak, the Company’s Chairman and Chief Executive Officer said, "We had another solidly profitable quarter. We expect to be very busy the rest of this year and may have three Gulf of Mexico wells drilling in March 2010. Our Dude prospect (Matagorda Island 617) should spud in February 2010 with two more GOM wells scheduled to spud in the March-April 2010 time frame. Concerning natural gas prices, the weather is cooperating on the demand side, but natural gas supply continues to hold steady. I wouldn't be surprised by either $3.00 or $6.00 natural gas over the next year or so, but we have good prospects and are aggressively moving forward to drill."


 

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