Arena Resources announced financial and operational results for the first quarter ended March 31, 2010. Oil and gas revenues were $51,797,626 compared to $20,193,160 for the quarter ended March 31, 2009, and net income was $18,113,091 or $0.46 per diluted share, compared to net income of $6,465,449 or $0.17 per diluted share, for the same period in 2009.
Arena's total production for the quarter ended March 31, 2010 was 739,523 BOEs (Barrel of oil equivalents). This represents a 30% increase over the same three month period in 2009 and a 16% increase over the three month period ending December 31, 2009. For the three months ended March 31, 2010, oil sales volume increased to 631,052 barrels, compared to 489,249 barrels for the same period in 2009, a 29% increase and gas sales volume increased to 650,828 MCF (thousand cubic feet), compared to 472,823 MCF for the same period in 2009, an 38% increase. The average commodity prices received by Arena were $74.84 per barrel of oil, a 103% increase from $36.89 per barrel of oil received for the quarter ended March 31, 2009, and $7.02 per MCF of natural gas, a 55% increase from the $4.54 per MCF of natural gas received for the same period in 2009.
Lease operating expenses, including production taxes, for the three months ended March 31, 2010 were $9.81 per BOE, a 5% increase from the prior year. Depreciation, depletion and amortization costs increased 31% to $16.63 per BOE. General and administrative costs, which included a $1,608,779 charge for stock based compensation, were $4.74 per BOE, a 1% increase, as compared to $4.71 per BOE in 2009, which included a $1,329,317 charge for stock based compensation.
Net cash flow from operations for the three months ended March 31, 2010 was $42,788,868 or $1.09 per diluted share, compared to net cash flow of $18,920,108 or $0.49 per diluted share for the same period in 2009 (1).
During the first quarter of 2010, the Company drilled 87 new San Andres zone development wells at its Fuhrman-Mascho property in Andrews County, Texas, consisting of eight 40-acre wells, sixteen 20-acre wells, fifty-five 10-acre wells and eight five-acre wells. Sixty-four of the wells were completed and producing as of March 31, 2010, while the remaining twenty-three were in various stages of completion. Additionally, twelve development wells which were drilled in the fourth quarter of 2009 were successfully completed and placed in production. The Company has now drilled 740 new San Andres development wells on this lease since initiating its developmental drilling program in mid-April, 2005, and continued its 100% development drilling success rate.
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