Aurora Oil & Gas Corporation Announces First Quarter 2009 Results

Share Name	Share Symbol	Market	Type
Aurora Oil & Gas Corp.	AMEX:AOG	AMEX	Ordinary Share

Aurora Oil & Gas Corp. (AMEX:AOG)
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TRAVERSE CITY, Mich., May 11 /PRNewswire-FirstCall/ -- Aurora Oil & Gas Corporation (NYSE Alternext US: AOG) today reported a net loss for the quarter ended March 31, 2009 of $58.2 million or ($0.56) per basic and diluted common share. The loss includes the impact of a non-cash ceiling test write-down of oil and gas properties in the amount of $53.6 million attributable to the recent decline in natural gas prices. Excluding this one-time charge, the net loss for the quarter totaled $4.6 million or ($0.04) per basic and diluted common share, as compared to a net loss of $1.2 million or ($0.01) per basic and diluted common share in the first quarter of 2008. Financial Review Oil and natural gas production revenues totaled nearly $3.2 million on sales of 617 million cubic feet of natural gas equivalent (Mmcfe) for the quarter. Compared to the fourth quarter of 2008, this represents a 26% decrease in revenues as a result of a 12% decrease in production and the impact of current commodity prices. Declines in market prices also impacted the Company's valuation of proved reserves. At quarter end, an average price of $3.65 (as compared to $6.07 used on December 31, 2008) was applied to Aurora's base of proved reserves. As a result, the Company is required to reduce its oil and gas properties by $53.6 million via a ceiling test write-down under the full-cost accounting method. This reduces Aurora's proved oil and natural gas properties balance to $35 million, and results in total shareholder's equity dropping to a deficit of $30.9 million. Additional detail on the financial results can be found in the Company's first quarter Form 10-Q filed March 8, 2009. This form can be retrieved from the Securities and Exchange Commission or via the Company website at http://www.auroraogc.com/SEC_Filings.htm. Selected historical financial data is provided for reference below. Drilling Activities During the first quarter of 2009, drilling activities were reduced as a result of limited capital availability and continued corporate restructuring efforts. Six (1.0 net to Aurora) wells were drilled by Aurora's partners, concentrated on conventional targets in farmed-out properties in Indiana. Five of the six wells involved a carried interest, resulting in no out-of-pocket cost for Aurora. A summary of the Company's well inventory on March 31, 2009 is as follows: Well Status as of March Antrim Antrim New Albany New Albany 31, Operated Non-Operated Operated Non-Operated Other Total 2009 Gross Net Gross Net Gross Net Gross Net Gross Net Gross Net -------------------------------------------------------------------------- Produc- ing 179 170.07 405 96.75 0 0.00 25 1.25 37 18.45 646 286.52 Waiting on Hook-Up 0 0.00 9 1.80 6 6.00 0 0.00 6 1.00 21 8.80 Res. Assess- ment 1 0.97 9 1.87 0 0.00 0 0.00 10 4.00 20 6.84 -------------------------------------------------------------------------- Total 180 171.04 423 100.42 6 6.00 25 1.25 53 23.45 687 302.16 Production Activities Total company production during the first quarter of 2009 averaged 6,853 net Mcfe per day. This represents a 12% decline from the fourth quarter of 2008, as detailed in the summary below: Q1 2009 Q4 2008 Estimated Production by Play/Trend Daily Daily (net mcfe) Total Average Total Average ---------------------------------------------------------------- Antrim Shale 567,144 6,302 667,754 7,258 New Albany Shale 16,484 183 18,913 205 Other 33,152 368 33,108 360 ---------------------------------------------------------------- Total 616,780 6,853 719,775 7,823 ---------------------------------------------------------------- Operated 370,996 4,122 433,523 4,712 Non-operated 245,786 2,731 286,252 3,111 ---------------------------------------------------------------- Total 616,780 6,853 719,775 7,823 ---------------------------------------------------------------- During the first quarter, Aurora personnel focused on containing operating costs and developing a plan to enhance the performance of its operated properties. This plan is being implemented in a portion of the Company's properties, targeting opportunities for improvement to compression systems and down-hole configuration, as well as installation of improved processing and monitoring equipment. The implementation of this plan is designed to optimize return on investment with careful consideration for the current corporate objective of cash conservation. Update on Acreage Aurora's acreage portfolio has remained fairly constant from December 31, 2008. Following is a summary of the Company's acreage inventory on March 31, 2009. March 31, 2009 Acreage by Play/Trend Gross Net ------------------------------------------------- Michigan Antrim shale 285,994 130,494 Indiana Antrim shale 15,773 15,773 New Albany shale 782,387 453,558 Other 74,561 51,698 ------------------------------------------------- Total 1,158,715 651,523 ------------------------------------------------- Update on Relationship with Creditors The forbearance agreement which was executed between the Company and its first lien lenders (administered by BNP Paribas) on February 12, 2009 expired on April 30, 2009. The Company continues to engage in discussions with its first lien and second lien creditors and their respective syndication participants to restructure Aurora's debt. Presently, the Company is working to extend the referenced forbearance agreement beyond April 30, 2009. There is no assurance that the lenders or their syndications will not accelerate or demand repayment of their debt, or that Aurora will be successful in restructuring its debt, finding alternative financing arrangements, or selling its assets. Update on De-listing Efforts On April 30, 2009, Aurora filed a Form 25 with the SEC, providing notification of the Company's desire to remove its securities from being listed on the NYSE Amex. Typically, 10 days after filing the Form 25, a Company's securities will move to the over-the-counter ("OTC") market. Aurora expects that its securities will move to be accessible via the OTC marketplace on May 11, 2009. The Company has received notice that its securities will be traded under the symbol "AOGS". This action does not involve deregistration of securities from the Securities and Exchange Commission ("SEC"). Aurora expects to continue to comply with all SEC regulations, including timely filing of required reports. As further information is available with respect to this move to the OTC market, the Company will publicly distribute that data, as deemed appropriate. Selected Financial Data The following tables set forth Aurora's financial information as of and for each of the periods indicated. You should review this information together with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the consolidated financial statements and related notes included in Aurora's Form 10-Q for the quarter ended March 31, 2009 and/or the consolidated financial statements and related notes included in Aurora's Form 10-K for the year ended December 31, 2008. For 3 months ended Statement of Operations Data March 31, 2009 March 31, 2008 Revenues: Oil and natural gas sales $3,166,175 $6,442,558 Pipeline transportation and marketing 167,201 105,261 Field service and sales 480,038 123,559 Interest and other 350,623 102,687 ------- ------- Total revenues 4,164,037 6,774,065 --------- --------- Expenses: Production taxes 110,410 339,314 Production and lease operating expense 2,205,885 2,670,144 Pipeline and processing operating expense 139,613 87,893 Field services expense 417,323 119,155 General and administrative expense 2,790,705 1,997,061 Oil and natural gas depletion and amortization 595,501 979,908 Other assets depreciation and amortization 342,807 355,773 Interest expense 2,121,829 1,462,412 Ceiling write-down of oil and gas properties 53,639,522 - Taxes (refunds), other 34,144 (71,292) ------ -------- Total expenses 62,397,739 7,940,368 ---------- --------- Net loss (58,233,702) (1,166,303) Net income attributable to noncontrolling interest (7,400) (15,105) ------- Net loss attributable to Aurora common shareholders $(58,241,102) $(1,181,408) -------------- Net loss attributable to Aurora common shareholders, per common share - basic and diluted $(0.56) $(0.01) ============= ============== Weighted average common shares outstanding - basic and diluted 103,282,788 102,227,258 For 3 months ended Cash Flow Data March 31, 2009 March 31, 2008 Cash provided by (used in) operating activities $(977,579) $3,212,111 Cash used in investing activities (1,332,817) (7,501,630) Cash provided by financing activities (45,285) 9,189,959 As of March 31, As of December 31, Balance Sheet Data 2009 2008 Cash and cash equivalents $7,649,457 $10,005,138 Other current assets 5,407,161 6,439,387 Oil and natural gas properties, net (using full cost accounting) 62,826,801 115,134,222 Other property and equipment, net 14,106,876 14,451,523 Other assets 13,529,760 13,906,789 Total assets $103,784,077 $160,201,081 Current liabilities $129,566,802 $127,312,547 Long-term liabilities, net of current maturities 4,830,160 5,265,459 Shareholders' (deficit) equity (30,602,885) 27,623,075 Total liabilities and (deficit) equity $103,784,077 $160,201,081 About Aurora Oil & Gas Corporation Aurora Oil & Gas Corporation is an independent energy company focused on unconventional natural gas exploration, acquisition, development and production with its primary operations in the Antrim shale of Michigan and the New Albany shale of Indiana and Kentucky. Cautionary Note on Forward-Looking Statements Statements regarding future events, occurrences, circumstances, activities, performance, outcomes, beliefs and results, including future revenues and production, relationship with its existing lenders, restructuring of existing credit facilities, the procurement of new credit facilities, anticipated capital availability, anticipated capital expenditures, ability to remediate production shortfalls, the sale or farmout of existing assets, future trading markets and SEC filings are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although we believe that the forward-looking statements described are based on reasonable assumptions, we can give no assurance that they will prove accurate. Important factors that could cause our actual results to differ materially from those included in the forward-looking statements include the timing and extent of changes in commodity prices for oil and gas, drilling and operating risks, the availability of drilling rigs, changes in laws or government regulations, unforeseen engineering and mechanical or technological difficulties in drilling the wells, operating hazards, weather-related delays, the loss of existing credit facilities, availability of capital, and other risks more fully described in our filings with the Securities and Exchange Commission. All forward-looking statements contained in this release, including any forecasts and estimates, are based on management's outlook only as of the date of this release and we undertake no obligation to update or revise these forward-looking statements, whether as a result of subsequent developments or otherwise. Join our email distribution list: http://www.b2i.us/irpass.asp?BzID=1419&to=ea&s=0 Contact: Aurora Oil & Gas Corporation Jeffrey W. Deneau, Investor Relations (231) 941-0073 http://www.auroraogc.com/ DATASOURCE: Aurora Oil & Gas Corporation CONTACT: Jeffrey W. Deneau, Investor Relations of Aurora Oil & Gas Corporation, +1-231-941-0073 Web Site: http://www.auroraogc.com/

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AOG Aurora Oil & Gas Corp.