iShares Trust (NASDAQ:CRED)
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CREDO Petroleum Corporation (NASDAQ: CRED) today reported that its
financial condition is sound and that the company is well positioned to
capitalize on opportunities that may arise due to recent events in the
U.S. and world financial markets.
In July CREDO completed a $16,675,000 stock sale. Working capital is
approximately $27,400,000, consisting primarily of cash and short term
investments, and the company has no debt.
As of the company’s 2007 fiscal year end,
proved reserves, reported on an SEC basis, were 20.5 billion cubic feet
of natural gas equivalent. The discounted value (at 10%) of those
reserves was approximately $62,000,000 based on $5.89 per Mcf for
natural gas reserves and $86.61 for oil reserves, which are roughly
equivalent to today’s prices. Reserve
quantities are updated quarterly and have not materially changed.
Reserves are currently being updated for the upcoming fiscal year-end
2008. In addition to SEC basis booked reserves, the company believes
that it has very substantial unbooked reserves in other categories which
provide significant upside potential.
Currently, the company has open natural gas hedge positions for the
production months of November 2008 though October 2009 covering
830 MMBtu. All of the hedges are currently profitable. In the aggregate,
these hedges are intended to cover the company’s
estimated future production for the applicable months hedged as follows:
approximately 50% for the Fall and Winter of 2008/2009 and approximately
30% for the Spring, Summer and Fall of 2009. The monthly hedge prices
(NYMEX basis) range from an average of approximately $9.80 for the Fall
and Winter months of 2008/2009 and $8.20 for the Spring, Summer and Fall
months of 2009. All open hedge contracts are indexed to the NYMEX.
Average prices in the company’s primary market
are expected to be 15% to 17% below NYMEX prices due to basis
differentials and transportation costs.
James T. Huffman, Chairman and CEO, stated, “This
year marks our 30th year as a public company.
In that time we have experienced a number of turbulent cycles. I am
proud that we have always provided a financially sound and profitable
business for our shareholders, employees, and customers. In our 30-year
history, there has been only one unprofitable year when low energy
prices forced a non-cash write down of property costs. Over the years,
CREDO has received accolades from many sources, including Forbes,
Fortune and U.S.A. Today, for outstanding long term performance in
both good and bad times.
“This year is no different. Our business is
sound and we are ready to seize opportunities as they become available.
Our people are seasoned and we have plenty of cash, no debt, and an
excellent reserve base. In addition to our Calliope Gas Recovery System,
we have outstanding drilling projects in Oklahoma, Kansas, Texas and
North Dakota.”
Huffman further stated, “Our Calliope Gas
Recovery System continues to provide enormous upside for CREDO because,
with its 'all-in' finding and production costs of about $1.00 per Mcf,
it provides very attractive, low risk returns across a wide range of gas
prices. We expect Calliope to become increasingly attractive to other
companies as they deal with changing economics in our industry.”
CREDO Petroleum Corporation is a publicly traded independent energy
company headquartered in Denver, Colorado. The company is engaged in the
exploration for and the acquisition, development and marketing of
natural gas and crude oil in the Mid-Continent and Rocky Mountain
regions. The company’s stock is traded on the
NASDAQ System under the symbol “CRED”
and is quoted daily in the “NASDAQ Global
Market” section of The Wall Street Journal.
This press release includes certain statements that may be deemed to
be "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. All statements included in this
press release, other than statements of historical facts, address
matters that the company reasonably expects, believes or anticipates
will or may occur in the future. Such statements are subject to
various assumptions, risks and uncertainties, many of which are beyond
the control of the company. Investors are cautioned that any such
statements are not guarantees of future performance and that actual
results or developments may differ materially from those described in
the forward-looking statements. Investors are encouraged to read
the "Forward-Looking Statements" and "Risk Factors" sections included in
the company's 2007 Annual Report on Form 10-K for more information.
Although the company may from time to time voluntarily update its
prior forward looking statements, it disclaims any commitment to do so
except as required by securities laws.