ENERJEX ANNOUNCES
QUARTER TO QUARTER REVENUE
INCREASE OF 258%
EnerJex
has achieved a 98% success rate on 90
new wells. In the last three quarters EnerJex has added $30.9 million in
pre-tax PV-10 Proved Reserves and identified 400 additional drillable
locations.
For the three month quarter ended December 31, 2007, EnerJex
delivered a 258% increase in quarter to quarter oil and gas revenues – from
$418,590 for the three months ended September 30, 2007, to $1,498,202 for the
quarter ended December 31, 2007.
In addition, there was a fifty-six-fold increase in the
three month oil and gas revenues for the quarter ended December 31, 2007 – from
$26,491 for the quarter ended December 31, 2006. For the nine month period
ended December 31, 2007, EnerJex reported oil and gas revenues of $1,982,119,
as compared to $76,314 for the same quarter in 2006.
The revenue increase for both the third quarter and the nine
months ended December 31, 2007 reflects the aggressive implementation of
EnerJex’s business model, resulting in growth in crude oil production volumes
from leases acquired and developed during these periods as well as increased
commodity prices. EnerJex began acquiring oil leases in April 2007.
For the three and nine months ended December 31, 2007, net
oil sales volumes were 16,854 and 25,674 barrels respectively, compared to zero
barrels for those same periods in 2006.
The average commodity price received by EnerJex was $88.89 per barrel of
oil for the quarter ended, and $77.20 for the nine months ended, December 31,
2007.
Since April of 2007, EnerJex has closed four acquisitions,
drilled 90 new wells (with a 98% success
rate), and increased its pre-tax PV-10 (present value) of Proved Reserves by
more than $30,900,000 or 1.2 million barrels of oil equivalent. EnerJex has also identified more than 400
additional drilling locations on its existing leases.
Based on production levels achieved during the end of the
December 31, 2007 quarter, EnerJex became operationally cash-flow positive, on
a non-GAAP basis. As a result, EnerJex
will continue to pursue its drilling programs using internally generated funds
and other capital alternatives.
EnerJex’s CEO, Steve Cochennet, stated, “We are extremely
pleased with the results of our efforts to-date. With a 98% drilling success
rate and the identification of 400 additional drillable locations – plus
quickly building to $30.9 million in PV-10 Proved Reserves as well as $17.2
million in Probable Reserves – we are confident that we have tremendous growth potential
ahead of us. We look forward to seeing dramatic results in 2008 and beyond.”
Losses of $719,517 for the three months ended December 31,
2007 include non-cash charges for stock based compensation, depletion,
accretion and loan costs totaling $777,682.
Losses of $4,077,942, for the nine months ended December 31, 2007
include non-cash charges for these same items totaling $3,288,982.
Reserve Values:
Proved reserves as of March 31, 2007 were zero. As of
December 31, 2007, proved reserves had grown to $30.9 million and probable
reserves had grown to $17.2 million. The reserve values were prepared by McCune
Engineering, an independent licensed petroleum engineering firm based in
Third Quarter
Earnings Call:
EnerJex will host an investor conference call to discuss its
operating results for the December 31, 2007 period on Friday, February 15, 2008
at 9:30 a.m. Central Time (CST).
Stockholders and other interested parties may participate in the
conference call by dialing 888-562-3356 (international participants dial 973-582-2700)
and referencing the conference ID 34591619, a few minutes before 9:30 a.m. CST
on February 15, 2008. A replay of the call will be available for an additional
30 days by dialing 800-642-1687 (international callers dial 706-645-9291), and
entering the conference ID 34591619.
About EnerJex
Resources, Inc.:
EnerJex is an oil and natural gas acquisition, exploration
and development company. Operations, conducted through EnerJex Kansas, Inc.
(formerly Midwest Energy Inc.) and DD Energy, Inc., its wholly owned operating
subsidiaries, are focused on the mid-continent region of the
Once acquired, EnerJex implements an exploration and
development program to accelerate the recovery of the existing oil and natural
gas reserves as well as to explore for additional reserves.
More information on EnerJex and its operations can be found
on its website: www.EnerJexResources.com.
Readers are urged to review EnerJex’s third quarter Form
10-QSB, available on the SEC's website (www.sec.gov),
for a discussion of EnerJex’s results of operations and review the third
quarter 2007 financial statements.
Forward Looking
Statements:
The statements in this press release regarding any implied
or perceived benefits from existing oil and gas field properties, actual proven
and probable reserves and revenues to be derived from the reserves, plans to
drill additional oil and gas wells, anticipated oil and gas revenues, number of
potential drillable locations, the acquisition of additional oil or gas leases,
maintaining mineral lease rights, and any other effects resulting from any of
the above are forward-looking statements. Such statements involve risks and
uncertainties, including, but not limited to, the continued production of gas
at historical rates, costs of operations, delays, and any other difficulties
related to producing minerals such as oil or gas, continued maintenance of the
oil field and properties, price of oil or gas, marketing and sales of produced
minerals, estimates made in evaluating proven or probable reserves, risks and
effects of legal and administrative proceedings and governmental regulation,
future financial and operational results, competition, general economic
conditions, and the ability to manage and continue growth.
Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual outcomes may
vary materially from those indicated. Important factors that could cause actual
results to differ materially from the forward-looking statements EnerJex makes
in this news release include market conditions and those set forth in reports
or documents it files from time to time with the SEC. EnerJex undertakes no
obligation to revise or update such statements to reflect current events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
Cautionary Note to
The United States Securities and Exchange Commission permits
oil and gas companies, in their filings with the SEC, to disclose only proved
reserves as defined in Rule 4-10(a) of Regulation S-X. EnerJex uses certain
terms herein, such as probable reserves, which the SEC's guidelines strictly
prohibit EnerJex from including in filings with the SEC. U.S. Investors are
urged to consider closely the disclosure in our Form 10-KSB, File No.
000-30234, available from EnerJex at 7300 W. 110th, 7th Floor, Overland Park,
Kansas 66210. You can also obtain this form from the SEC by calling
1-800-SEC-0330 or on the SEC's website at www.sec.gov.
###
For further
information contact:
Dede Jones, Director of Finance
913-693-4600 or djones@enerjexresources.com
or
Debbie Hagen, Investor Relations
913-642-3715 or dhagen@hagenandpartners.com
EnerJex Resources,
Inc.
Condensed
Consolidated Statement of Operations
(Unaudited)
|
|
|
|
|
For the Three Months Ended |
|
For the Nine Months Ended |
||||||||
|
|
|
|
|
December 31, |
|
December 31, |
||||||||
|
|
|
|
|
2007 |
|
2006 |
|
2007 |
|
2006 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
||||
|
Oil and gas activities |
$ |
1,498,202 |
|
$ |
26,491 |
|
$ |
1,982,119 |
|
$ |
76,314 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
||||
|
Direct costs |
|
722,540
|
|
|
63,051 |
|
|
1,104,272 |
|
|
279,619 |
|||
|
Professional fees |
|
100,770 |
|
|
69,224 |
|
|
1,112,832 |
|
|
287,478 |
|||
|
Investor relations fees |
|
81,857 |
|
|
- |
|
|
164,435 |
|
|
- |
|||
|
General and administrative
expenses |
|
357,256 |
|
|
139,857 |
|
|
1,758,262 |
|
|
319,366 |
|||
|
Depreciation, depletion and
amortization |
|
387,408
|
|
|
6,889 |
|
|
532,665 |
|
|
23,359 |
|||
|
Impairment of goodwill |
|
- |
|
|
(10,000) |
|
|
- |
|
|
677,000 |
|||
|
|
Total expenses |
|
1,649,831 |
|
|
269,021 |
|
|
4,672,466 |
|
|
1,586,822 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating (loss) |
|
(151,629) |
|
|
(242,530) |
|
|
(2,690,347) |
|
|
(1,510,508) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
||||
|
Interest expense |
|
(224,273) |
|
|
(2,556) |
|
|
(507,640) |
|
|
(4,239) |
|||
|
Loan fees |
|
(39,298) |
|
|
- |
|
|
(113,155) |
|
|
- |
|||
|
Loan interest accretion |
|
(304,317) |
|
|
- |
|
|
(766,800) |
|
|
- |
|||
|
Interest income |
|
- |
|
|
418 |
|
|
|
|
|
3,495 |
|||
|
Reversal of loan penalty
expense |
|
- |
|
|
- |
|
|
- |
|
|
- |
|||
|
Loss on sale of asset |
|
- |
|
|
- |
|
|
- |
|
|
(3,854) |
|||
|
|
Total other income (expense) |
|
(567,888)
|
|
|
(2,138) |
|
|
(1,317,595) |
|
|
(4,598) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
(719,517)
|
|
$ |
(244,668) |
|
$ |
(4,077,942) |
|
$ |
(1,515,106) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of |
|
|
|
|
|
|
|
|
|
|
|
||||
|
common shares outstanding -
basic |
|
22,203,256 |
|
|
12,900,395 |
|
|
20,691,689 |
|
|
12,142,498 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share
- basic |
$ |
(0.03) |
|
$ |
(0.02) |
|
$ |
(0.16) |
|
$ |
(0.12) |
EnerJex Resources,
Inc.
Condensed
Consolidated Balance Sheets
|
|
|
|
|
December 31, |
|
March 31, |
||
|
|
|
|
|
2007 |
|
2007 |
||
|
|
|
|
|
(Unaudited) |
|
(Audited) |
||
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|||
Current assets: |
|
|
|
|
|
||||
|
Cash |
|
$ |
957,477 |
|
$ |
99,493 |
||
|
Accounts receivable |
|
57,788 |
|
|
4,138 |
|||
|
Sales revenue receivable |
|
319,521 |
|
|
10,300 |
|||
|
Prepaid expenses |
|
10,797 |
|
|
6,673 |
|||
|
|
Total current assets |
|
1,345,583 |
|
|
120,604 |
||
|
|
|
|
|
|
|
|
|
|
Fixed assets, net of
accumulated depreciation of $21,140 and 8,875 |
|
127,400 |
|
|
26,625 |
||||
|
|
|
|
|
|
|
|
|
|
Other assets: |
|
|
|
|
|
||||
|
Note receivable – officer |
|
- |
|
|
23,100 |
|||
|
Oil and gas properties using
full cost accounting: |
|
|
|
|
|
|||
|
|
Properties not subject to
amortization |
|
74,777 |
|
|
322,178 |
||
|
|
Properties subject to
amortization |
|
9,016,166 |
|
|
- |
||
|
|
|
Total other assets |
|
9,090,943 |
|
|
345,278 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
10,563,926 |
|
$ |
492,507 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
||||
|
Accounts payable |
$ |
364,755 |
|
$ |
42,299 |
|||
|
Notes payable |
|
- |
|
|
350,000 |
|||
|
Accrued liabilities |
|
126,981 |
|
|
95,890 |
|||
|
Deferred payments from
Euramerica for development |
|
51,925 |
|
|
- |
|||
|
Promissory notes payable |
|
965,000 |
|
|
- |
|||
|
Current portion of long term
debt |
|
438,318 |
|
|
- |
|||
|
|
|
Total current liabilities |
|
1,946,979 |
|
|
488,189 |
|
|
|
|
|
|
|
|
|
|
|
Asset retirement obligation |
|
389,475 |
|
|
23,908 |
||||
|
|
|
|
|
|
|
|
|
|
Long term liabilities: |
|
|
|
|
|
||||
|
Convertible note payable |
|
25,000 |
|
|
25,000 |
|||
|
Long-term debt, less current
portion |
|
10,235,332 |
|
|
- |
|||
|
|
|
|
|
|
10,260,332 |
|
|
25,000 |
Commitments and
contingencies |
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity
(Deficit): |
|
|
|
|
|
||||
|
Preferred stock, $0.001 par
value, 10,000,000 |
|
|
|
|
|
|||
|
|
shares authorized, no shares
issued and outstanding |
|
- |
|
|
- |
||
|
Common stock, $0.001 par value,
100,000,000 shares authorized |
|
|
|
|
|
|||
|
|
22,203,256 shares issued and
outstanding |
|
22,203 |
|
|
13,179 |
||
|
Common stock owed but not
issued, 0 and 15,000 shares |
- |
|
|
15 |
||||
|
Unamortized cost of stock,
warrants & options issued for services |
(129,329) |
|
|
(65,187) |
||||
|
Unamortized loan fees and
interest |
|
(4,086,880 |
|
|
- |
|||
|
Additional paid-in capital |
|
8,835,059 |
|
|
2,603,374 |
|||
|
Accumulated (deficit) |
|
(6,673,913) |
|
|
(2,595,971) |
|||
|
|
|
|
|
|
(2,032,860) |
|
|
(44,590) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
10,563,926 |
|
$ |
492,507 |