RAM Energy Resources, Inc. (Nasdaq: RAM) today announced third quarter 2011 financial results and operating highlights, together with a revised non-acquisition capital budget and plans for continuing development of the Company’s Northern Oklahoma Mississippian play.
RAM Reports 3Q 2011 Net Income of $11.8 Million vs. $1.6 Million in 3Q 2010
For the quarter ended September 30, 2011, RAM reported net income of $11.8 million, or $0.15 per share, based on 79.1 million fully diluted weighted average shares outstanding, compared to $1.6 million, or $0.02 per share, on 78.6 million fully diluted shares outstanding in the year-ago quarter.
Modified EBITDA (a non-GAAP measure) was $12.4 million for the 3Q 2011, compared with $12.0 million in last year’s quarter. Similarly, free cash flow (a non-GAAP measure) was $9.0 million, or $0.11 per share, for this year’s third quarter compared to $7.5 million, or $0.10 per share, in last year’s third quarter.
Update to Osage Concession Activity
Drilling of the four vertical wells planned for the third quarter was delayed until late in the quarter due to rig availability. The Cooper #3-35 spudded on September 24, 2011 and drilled to a total depth of 2,380 feet and is currently testing. The Kendrick #2-27 spudded on September 30, 2011 and drilled to a depth of 2,411 feet is waiting on completion. Both the Cooper #3-35 and the Kendrick #2-27 wells were drilled through the Mississippi Chat and Lime formations. Subsequent to quarter’s end, the Ricketts #2-25 spudded on October 7, 2011 and reached a total depth of 2,500 feet on October 10, 2011. This well is currently waiting on completion. Drilling of the fourth well, the Jones #1-33, continues to be delayed pending resolution of an access road to the drill site. Permitting has been approved for the Rickets #3-35 SWD, the Company’s second salt water disposal well in the play. Tentative plans are to drill the Ricketts #3-35 SWD in December of this year depending on rig availability. The addition of the Ricketts #3-35 SWD will add significant disposal capacity for the salt water which is produced in association with the oil and gas from the Mississippian formation.
The Surber #1-26 continues to produce at rates considerably above the type curve of vertical wells surveyed. After fracture stimulation was applied to the Mississippi Chat formation the well produced at a rate of 108 barrels of oil equivalent per day (BOEPD) in June 2011. As of October 31, 2011 cumulative production from the well was approximately 16,000 barrels of oil equivalent (BOE) and the daily production was approximately 50 BOE.