Kelley Reports 1998 Unaudited Results.HOUSTON Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; , TEXAS--(BUSINESS WIRE)--April 7, 1999--KELLEY OIL & GAS CORPORATION (Nasdaq SmallCap: KOGC KOGC Kimberley Oaks Golf Course (St. Charles, Michigan) ) ("Kelley Kelley may refer to any of the following: People
n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. were approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 315 billion cubic feet of natural gas equivalent ("Bcfe"), comprised of 284 billion cubic feet of natural gas ("Bcf") and 5.3 million barrels of oil (10%). Approximately 64% of reserves are classified as proved developed by the Company's independent engineering firm. In 1998, the Company added approximately 28 Bcfe of proved reserves proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. at a finding cost of $0.91 per thousand cubic feet of natural gas ("Mcf") through its exploratory activities. These reserves added were offset by negative revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. of approximately 32 Bcfe and the sale of properties with reserves of approximately 15 Bcfe. The Company's results were impacted by increased production volumes and related expenses, lower commodity prices and a higher level of exploration activities as compared to 1997. Production for 1998 totaled 35.6 Bcf of gas and 375,000 barrels of oil and condensate condensate, matter in the form of a gas of atoms, molecules, or elementary particles that have been so chilled that their motion is virtually halted and as a consequence they lose their separate identities and merge into a single entity. , or a total of 37.8 Bcfe, compared to 31.6 Bcfe for the same period in 1997, an increase of 20%. Production expenses for 1998 were $19.9 million compared to $11.0 million in the comparable 1997 period, reflecting higher cost offshore production acquired in December December: see month. 1997. The average sales price received for production in 1998 was $2.09 per thousand cubic feet of natural gas equivalent ("Mcfe") compared to $2.27 per Mcfe for 1997, a decrease of 8%. Exploration expenses for 1998 increased to $12.0 million from $5.4 million for 1997, primarily due to increased seismic acquisition and leasehold An estate, interest, in real property held under a rental agreement by which the owner gives another the right to occupy or use land for a period of time. leasehold n. abandonments. Also expensed in 1998 was a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of approximately $25 million for impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. of long-lived long-lived adj. 1. Having a long life: a long-lived aunt. 2. Lasting a long time; persistent: a long-lived rumor. 3. assets pursuant to SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System 121. The Company's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: operations during 1998 resulted in total revenues of $80 million (including $3.5 million related to gains on natural gas hedges) and a net loss of $62 million ($0.49 per share of common stock), compared to 1997 total revenues of $76 million and a $2.6 million net loss ($0.03 per share of common stock). In 1998, the Company participated in drilling 62 gross (26.93 net) wells, of which 54 gross (23.25 net) wells were completed and found to be productive, an 87% success rate. Not included in these numbers were two wells (0.84 net) that were in progress at year-end, both of which have since been completed as producers. Of the 62 gross wells, 15 were exploratory in nature of which 8 gross (2.53 net) were completed as producers (a 53% success rate for the exploratory program). The most significant discovery in 1998 was the Harry S. Bourg bourg n. 1. A market town. 2. A medieval village, especially one situated near a castle. [French, from Old French, from Late Latin burgus, fortress, 2-1 well, in the Bayou bayou (bī`ō, bī`  ) [Louisiana Fr.; from Choctaw bayuk=small stream], term used mainly in U.S. Sauveur field in Terrebonne Parish, Louisiana Terrebonne Parish (Cajun French:Paroisse Terrebonne) is a parish located in the U.S. state of Louisiana. Its population is 104,503 (as of 2000). The parish seat is Houma. It is the largest parish in Louisiana in terms of land area. , which
began producing to sales on March 1, 1999 at approximately 1,000 barrels
of oil per day and 1,000 Mcf per day. Kelley owns a 50% working interest
in the initial and follow-up follow-up,n the process of monitoring the progress of a patient after a period of active treatment. follow-up subsequent. follow-up plan development wells planned to be drilled. Kelley's independent engineering firm has attributed more than 3 million barrels of oil and 3 Bcf of natural gas (21 Bcfe) in proved reserves net to the Company at year-end 1998. A follow-up development well is due to commence shortly and is expected to produce from the proved reservoirs and test other sands found in the first well bore at a structurally higher position (approximately 600 feet). The Company, along with a third party firm that specializes in estimating oil and gas reserves, believes the field has the potential to provide significant additional reserves. The Company expects capital expenditures in 1999 to approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. $10-15 million (depending on general market conditions), with the primary focus being on development of its south Louisiana Louisiana (ləwē'zēăn`ə, l ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. prospects, the
Bayou Sauveur field in particular.Kelley Oil & Gas Corporation is engaged in the development, exploration, acquisition and production of oil and natural gas. Natural gas represents about 90% of the Company's equivalent production and proved reserves. Kelley Oil & Gas Corporation common stock and preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. are traded on the NASDAQ SmallCap Market under the symbols KOGC and KOGCP. Cautionary Statement as to Forward-Looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. Information Statements made herein (as well as information included in oral or other written statements made or to be made by the Company or its representatives) that are forward-looking in nature are intended to be "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. , and Section 21E of the Securities Exchange Act of 1934, as amended, relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc matters such as anticipated operating and financial performance, business prospects, developments and results of the Company. Actual performance, prospects, developments and results may differ materially from any or all anticipated results due to economic conditions and other risks, uncertainties and circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or partly or totally outside the control of the Company, including rates of inflation, natural gas prices, uncertainty of reserve estimates, rates and timing of future production of oil and gas, exploratory and development activities, acquisition risks, changes in the level and timing of future costs and expenses related to drilling and operating activities and those risk factors described on pages 11 and 12 of the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 1997. Words such as "anticipates," "believes," "estimates," "expects," "projects" and similar expressions are intended to identify forward-looking statements. Forward-looking statements include the risk factors described above and more fully in the Company's Form 10-K mentioned above. -0-
Kelley Oil & Gas Corporation
Condensed Income Statements
(In thousands, except per share data)
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
1998 1997 1998 1997
Oil and gas
revenues $ 16,311 $ 23,634 $ 79,150 $ 75,864
Interest and
other income 423 (33) 505 274
Total revenues 16,734 23,601 79,655 76,138
Production expenses 4,578 3,567 19,878 10,955
Exploration expenses 2,322 2,654 12,034 5,433
General and
administrative expenses 1,547 1,607 7,077 6,875
Interest and
other debt expenses 8,676 6,897 33,333 25,071
Depreciation,
depletion and
amortization 8,213 7,439 38,602 25,853
Impairment of
oil and gas properties 25,738 -- 25,738 --
Net income (loss) (34,340) 1,437 (57,007) 1,951
Cumulative
preferred stock
dividends (1,137) (1,145) (4,550) (4,582)
Net income (loss)
applicable to common
shareholders (35,477) 292 (61,557) (2,631)
Basic and diluted
income (loss)
per common share (.28) -- (.49) (.03)
Average common shares
outstanding 125,910 107,752 125,783 100,757
KELLEY OIL & GAS CORPORATION
Condensed Balance Sheets
(In thousands)
(Unaudited)
December 31, December 31,
1998 1997
Assets:
Current assets $ 28,251 $ 26,858
Property and equipment, net 256,455 293,613
Other assets 1,491 2,131
---------- ----------
Total assets $ 286,197 $ 322,602
========== ==========
Liabilities and Stockholders'
Deficit:
Current liabilities $ 65,636 $ 42,040
Long term debt 287,500 286,183
Stockholders' deficit (66,939) (5,621)
---------- ----------
Total Liabilities and
Stockholders' Deficit $ 286,197 $ 322,602
========== ===========
KELLEY OIL & GAS CORPORATION
Condensed Statements of Cash Flows
(In thousands)
(Unaudited)
Year Ended December 31,
1998 1997
Operating Activities:
Net income (loss) $ (57,007) $ 1,951
Adjustments to reconcile
net income (loss) to net cash
provided by operating
activities:
Depreciation, depletion
and amortization 38,602 25,853
Impairment of oil and
gas properties 25,738 --
Exploration expenses 12,034 5,433
Accretion and amortization of
debt expenses 5,236 4,297
--------- ---------
Cash flow from operations
before changes in operating
assets and liabilities 24,603 37,534
Net changes in operating
assets and liabilities (2,301) 2,070
--------- ---------
Net cash provided by
operating activities 22,302 39,604
Investing Activities:
Capital expenditures (56,579) (53,140)
Acquisition of oil and
gas properties -- (111,135)
Proceeds from Sale
of Properties 17,363 --
--------- ---------
Net cash used in investing
activities (39,216) (164,275)
Financing Activities:
Net proceeds from bank
credit facility 200 97,800
Proceeds from sale of
common stock, net 273 27,545
Proceeds from sale of
notes, net 29,526 --
Proceeds from conversion
of preferred stock (2) --
Retirement of notes (228) --
Dividends on preferred
stock (4,582) (4,582)
--------- ---------
Net cash provided by
financing activities 25,187 120,763
--------- ---------
Increase (decrease) in cash
and cash equivalents 8,273 (3,908)
Cash and cash equivalents,
beginning of period 162 4,070
--------- ---------
Cash and cash equivalents,
end of period $ 8,435 $ 162
========= =========
KELLEY OIL & GAS CORPORATION
Summary Production Information
(Unaudited)
Three Months Ended Year Ended
December 31, December 31,
1998 1997 1998 1997
Average Sales Price per Unit:
Oil and other liquid
hydrocarbons (per Bbl) $ 11.15 $ 18.58 $ 13.09 $ 19.34
Natural gas (per Mcf) 2.09 2.48 2.09 2.27
Natural gas equivalent (per Mcfe) 2.07 2.51 2.10 2.31
Average Daily Production:
Oil and other liquid
hydrocarbons (Mbbls) 0.7 0.9 1.0 0.6
Natural gas (Mmcf) 81.8 92.3 97.4 82.7
Natural gas equivalent (Mmcfe) 86.2 97.5 103.6 86.5
Net Production Data:
Oil and other liquid
hydrocarbons (Mbbls) 67 79 375 226
Natural gas (Mmcf) 7,526 8,493 35,557 30,202
Natural gas equivalent (Mmcfe) 7,928 8,967 37,807 31,558
Cost per Mcfe:
Lifting costs $ .47 $ .27 $ .41 $ .23
Severance and ad valorem taxes .11 .13 .12 .12
General and administrative expenses .20 .18 .19 .22
Depreciation, depletion and
amortization
(oil and gas activities) 1.01 .81 1.00 .80
Interest expense, excluding
accretion and amortization .91 .65 .74 .66
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