Tri-Valley Corporation Reports 2011 Financial Results
Tri-Valley Corporation (NYSE Amex: TIV) today announced its financial results for the year ended December 31, 2011. Oil and gas production revenues grew 34% to $2.3 million in 2011 from $1.8 million in the prior year, reflecting increased production at both the Pleasant Valley and Claflin oil fields and higher oil prices. Net oil production in 2011 totaled 29,785 barrels compared with 24,559 barrels in 2010, an increase of 21%. Oil prices on average in 2011 were 10% higher than 2010. Net production costs increased 20% from 2010, largely the result of an increase in production and steaming activity at Claflin.
“The growth in oil revenues reflects the success of our efforts during the past year to increase production at Pleasant Valley and establish new wells at Claflin,” said Maston Cunningham, President and CEO of Tri-Valley Corporation. “At Pleasant Valley, during 2011 we increased oil production through a more aggressive steam cycle program and optimized artificial lift methods which reduced bottlenecks in our production process. Gross production of native oil at Pleasant Valley increased 33% from 202 to 269 barrels per day. At Claflin, during 2011 we drilled eight new wells in the second quarter, but had to shut down our steam generation facility for modifications required for new safety and emissions permits. Steam generation resumed in November following modification of our 19.5 MMBTU/hour steam generator and receipt of the new permits. Through the end of December 2011, six of the eight new wells had been steamed and we have received good production response. Gross production at Claflin increased 51% during 2011 and averaged 43 barrels per day in December following resumption of steam injection in the fourth quarter. Initial steam injection for the remaining two new wells was completed in early January. In addition to higher production, our oil revenues also benefitted from higher oil prices available through our recently signed agreements with Plains Marketing and ConocoPhillips and market dislocation factors which caused California heavy crudes to sell at a premium to the West Texas Intermediate Crude for most of the year. On average, we realized an improvement in price of approximately $6.95 per barrel over 2010.”
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