RAM Energy Resources Reports Second Quarter 2011 Results And Update To Osage Mississippian Play

RAM Energy Resources, Inc. (Nasdaq: RAME) today announced second quarter 2011 earnings and financial highlights as well as an update on its testing of several wells in the Southern Surber area of the company’s Osage Mississippian exploration play.

RAM Reports 2Q 2011 Net Income of $8.9 Million vs. $2.7 Million in 2Q2010

For the quarter ended June 30, 2011, RAM reported net income of $8.9 million, or $0.11 per share, compared to $2.7 million, or $0.03 per share, in the year-ago quarter.

Modified EBITDA (a non-GAAP measure) was $11.6 million for the 2Q11, compared with $12.5 million in last year’s quarter. Similarly, free cash flow (a non-GAAP measure) was $7.7 million, or $0.10 per share, for this year’s second quarter compared to $7.2 million, or $0.09 per share, in last year’s second quarter.

Update to Osage Concession Activity

Southern Suber Area

Modifications to the company’s production facilities and salt water disposal well have been completed, and RAM has begun the process of testing previously drilled wells that have been shut in pending completion of these improvements. In addition, the company is adding a natural gas powered electric generator to the central tank battery which will provide electricity to run submersible pumps in the Surber #1-26 and Rickets #3-26 wells and additional pumps, if needed, to increase the capacity of the water disposal facilities. Plans are to permit a second salt water disposal well for fluid disposal from the recently drilled wells and to service future wells in this area. The Surber #1-26 well, which was fracture stimulated in late March, continues to produce at rates well above the type curve, producing about 108 barrels of oil equivalent per day, or BOEPD (composed of 55 barrels of oil and 317 MCF of high BTU natural gas). Initial production testing on the Surber #1-35, Ricketts #2-35 and Surber #2-T, after having been acidized but not fractured , currently aggregates to 17 BOEPD (composed of 8 barrels of oil and 52 MCF of high BTU natural gas). As a result of the excellent response observed to date after fracturing the Surber #1-26 well, the company is evaluating plans to also apply a slick water frac treatment to the Surber #1-35, Ricketts #2-35 and Surber #2-T, with the expectation of achieving increased production volumes. The Rickets #3-26, which was drilled to the Mississippi Chat in late 2010 and fractured stimulated in April of this year, is scheduled for testing in mid-August. The well is currently shut in pending installation of the field electric generator to enhance salt water disposal capacity.