Endeavor Notes Strong Operating, Financial Performance in Q2
Endeavour International Corporation has reported discretionary cash flow of $38.6 million in the second quarter of 2008 that more than doubled from the $17.8 million reported in the second quarter of 2007 and increased sequentially from $36.3 million reported in the first quarter. Revenues for the second quarter, boosted by high sales volumes of 10,222 barrels of oil equivalent per day (boepd), were up 273 percent to $86.3 million from $31.6 million in the same period in 2007 and $61.3 million reported in the first quarter of 2008. Net income as adjusted for the quarter was $3.0 million, or $0.02 per share, compared to net loss as adjusted of $3.5 million, or $0.03 per share, in the second quarter last year. Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) increased to $52.5 million in the second quarter this year from $19.4 million in the second quarter a year ago and $42.6 million in the first period of 2008.
"Strong operating and financial performance this quarter generated discretionary cash flow sufficient to fund an active exploration and development program while reducing debt by another $15 million," said William L. Transier, Chairman, Chief Executive Officer and President. "The solid foundation of production and cash flow we have built at Endeavour is a competitive advantage among peer group companies that are being forced into the tumultuous capital markets to fund growth activities."
On a GAAP basis, the company reported a net loss to common stockholders for the second quarter of 2008 of $66.7 million or $0.52 per share as compared to a net loss of $13.0 million or $0.11 per share for the year-ago quarter.
Highlights of the first half of the year include:
Natural gas discovery and successful appraisal in Norway -- The company's first well as part of its 2008 exploration campaign discovered natural gas at the Galvort prospect on production license 348 in the Norwegian North Sea. A sidetrack further confirmed the discovery encountering a gas column in Middle to Lower Jurassic reservoir rocks. Geologic evaluations of the data are continuing. Endeavour Energy Norge AS holds 2.5 percent working interest in production license 348.
Norwegian exploratory drilling underway -- Two exploration wells are currently drilling in the Norwegian Continental shelf. The Noatun C, a prospect in Block 6407/7 north of the Njord field, is nearing its objective Jurassic target with results expected in late August. Endeavour holds a 2.5 percent interest in the block. The Brage North, an exploration target in Block 31/4, began drilling in mid-July from the Brage platform to test two Jurassic reservoirs. The company holds a 4.4 percent working interest in the block.
Participation in 25th Offshore Oil and Gas Licensing Round -- Endeavour submitted applications in the largest license round to date with a record breaking 2,297 blocks or part blocks in United Kingdom waters offered for exploration. The company applied for 10 full or partial blocks, mostly located in its focus areas. The results of the round are expected to be announced toward the end of the year.
Marked production milestone -- The Alba field in Block 16/26 in the Central North Sea produced its 350 millionth barrel of oil in April. The asset is on track to produce more than 500 million barrels of oil through technology and infrastructure improvements. Endeavour holds a 2.25 percent working interest in the field.