Barnwell Industries Reports Year-End Results.

HONOLULU, Hawaii--(BUSINESS WIRE)--Dec. 18, 1998--Barnwell Industries Inc. (ASE:BRN) today reported a net loss of $3,890,000 ($2.95 per share) for the year ended Sept. 30, 1998, as compared to net earnings of $1,050,000 (79 cents per share) for the year ended Sept. 30, 1997.

For the quarter ended Sept. 30, 1998, Barnwell reported a net loss of $160,000 (12 cents per share), as compared to net earnings of $110,000 (8 cents per share) for the quarter ended Sept. 30, 1997.

Morton H. Kinzler, chairman and chief executive officer of Barnwell, commented, "The loss for the year includes $2,995,000 of non-cash write-downs, primarily a of write-off of all of the company's U.S. oil and gas investments.

Due to disappointing drilling results from the company's U.S. oil and gas properties and a significant decline in oil prices, the company discontinued development of its U.S. oil and gas prospects and wrote off its investment in U.S. oil and gas properties to zero.

"This year's loss also reflects the impact of 35%, 33% and 5% declines in liquids, oil and gas prices, respectively. The loss for the current quarter also reflects the impact of declines in oil and liquids prices, as compared to the same quarter in 1997.

"Despite the recent trends in oil prices, the outlook for natural gas is very positive. Next month, a new pipeline capable of delivering one billion cubic feet per day of additional capacity from Western Canada to the United States should be completed, and a decline in natural gas delivery capacity within Alberta are both expected to have a positive impact on natural gas prices.

"Natural gas reserves make up the majority of the company's reserve base, and approximately 60% of fiscal 1998 oil and gas revenues were generated by natural gas sales. In Canada, the company participated in the drilling of 24 successful natural gas wells and 21 successful oil wells in the year ended Sept. 30, 1998. The company continues to move forward in Canada, where it restructured its oil and gas management team this year and where it has met with considerable success in the past.

"The company's 50.1% owned partnership, Kaupulehu Developments, also continues to make progress towards the final zoning approvals for its leasehold land position at Kaupulehu, Hawaii, to allow residential, resort and commercial development in the area adjacent to the Four Seasons Resort at Historic Kaupulehu.

"Earlier this month, following a contested case hearing conducted in November, the Planning Commission of the County of Hawaii granted, by a unanimous vote, Kaupulehu Developments' requested use permit to be effective when the zoning ordinance is adopted. The Planning Commission of the County of Hawaii and the Planning Committee of the Hawaii County Council have both made favorable recommendations for approval of the zoning ordinance; however, the Hawaii County Council has not as yet heard or taken action on the zoning ordinance." -0-

                         Barnwell Industries Inc.
                       Comparative Operating Results

                            Year Ended                Quarter Ended
                             Sept. 30,                  Sept. 30,
                         1998         1997           1998        1997

Revenues            $ 11,920,000  $ 14,830,000   $ 2,810,000  $ 3,720,000
Net (loss) earnings   (3,890,000)    1,050,000      (160,000)     110,000
Basic and diluted
 (loss) earnings
 per share          $      (2.95)         0.79         (0.12)        0.08
Weighted average
 shares and
 equivalent shares
 outstanding           1,319,719     1,325,963     1,316,952    1,326,332