Contango Swings to Loss



Contango O&G reported natural gas and oil sales from continuing operations for the fiscal year ended June 30, 2010 of approximately $160.7 million, compared to $190.7 million for the same period last year. The Company reported net income attributable to common stock for the year ended June 30, 2010 of approximately $49.7 million, or $3.14 per basic share and $3.08 per diluted share. This compares to net income attributable to common stock for the year ended June 30, 2009 of approximately $55.9 million, or $3.41 per basic and $3.35 per diluted share.

For the three months ended June 30, 2010, natural gas and oil sales from continuing operations were approximately $41.2 million, up from $36.3 million for the three months ended June 30, 2009. Contango had net income attributable to common stock of approximately $15.4 million, or $0.97 per basic share and $0.95 per diluted share, compared to net income attributable to common stock for the three months ended June 30, 2009 of approximately $5.2 million, or $0.33 per basic and $0.32 per diluted share.

For fiscal year 2011, our capital expenditure budget calls for us to invest approximately $60 million to drill up to four wildcat exploration wells in the Gulf of Mexico, at an estimated dry hole cost of approximately $15 million each, net to Contango, subject to permitting approval by the Bureau of Ocean Energy Management, Regulation and Enforcement (previously the Minerals Management Service). We also plan to invest approximately $22.5 million to drill and complete 15 additional onshore wells in Panola County, Texas under our joint venture with Patara Oil & Gas.

Our production is currently 105 Mmcfed, net to Contango. As of September 1, 2010, we had no debt and approximately $45.5 million in cash and cash equivalents.


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