Recovery Energy, Inc. (OTCBB: RECV), an independent oil and gas exploration and production company which commenced operations in 2010, today provided an update on its operations and reported its financial results for the three months and six months periods ended June 30, 2010.
Year to date the company has completed 6 separate property acquisitions that now comprise 21 producing wells with approximately 700 BOE per day and 83,000 net acres in the Denver-Julesburg (DJ) Basin. The company has numerous conventional targets in the “D” sand, “J” sand, Codell, Greenhorn, and Paleozoic formations that provide near-term, lower-risk drilling inventory. In addition, the company has significant exposure to the emerging Niobrara oil shale resource play through its long-term leasehold position that is in close proximity to current horizontal drilling activity. The company is in the process of connecting its first drilled well, the State Bradbury 13-36 located in Arapahoe County, CO. The well was tested in the “J” sand at an initial production rate of approximately 805 mcf of gas per day and 20 barrels of condensate per day. The company operates and owns a 62.5% working interest in the well. The company has also spud the first of two additional wells that will be drilled to the “J” sand formation, one in Laramie County, WY and the other in Banner County, NE with results expected in the third quarter.
2010 Operations Highlights
|June||DJ Basin acreage acquisition|
|April - June||$25 million equity financing|
|April||Stateline Field acquisition|
|March||Palm Field acquisition|
|January||Wilke Field acquisition|
Financial Results:Total Revenue for the second quarter ended June 30, 2010 was $5,194,849. The company reported a second quarter net loss attributable to common stockholders of ($3,196,779) or ($0.13) per share. The net loss attributable to common stockholders for the second quarter 2010 includes non-cash expenses of approximately $3.9 million comprised of $1.5 million of amortization expense related to deferred financings cost, and $2.5 million of non-cash compensation expense as well as other corporate start-up expenses. A comparison against the company’s operations for the comparable 2009 period was not meaningful as its current operations commenced in 2010.