DENVER, Nov. 7 /PRNewswire-FirstCall/ -- Kodiak Oil & Gas Corp.
(Amex: KOG; TSX Venture), an oil and gas exploration and production
company with assets in the Green River and Williston Basins, today
reported financial and operating results for the nine months ended
September 30, 2006. Financial tables for the nine-month period and
third quarter 2006 are included at the end of this news release.
Nine months ended September 30, 2006 The Company reported a net
loss for the nine months ended September 30, 2006 of $1,403,000 or
$0.02 per share compared with a net loss of $868,000 or $0.02 per
share for the same period in 2005. All per share amounts are
presented on a fully diluted basis. Net income before depreciation,
depletion and amortization, gain on foreign currency exchange, and
stock based compensation charges was $968,000 for the nine-month
period ended September 30, 2006 as compared to a loss of $864,000
for the same period ending September 30, 2005. Oil and gas sales
for the nine-month period were $2,811,000 versus $102,000 in the
same period in 2005. Total revenues were $3,411,000 versus $172,000
in the same period a year ago. Gas production volumes were 93,721
thousand cubic feet (Mcf) for the nine-month period ended September
30, 2006, compared to 28,907 Mcf for the same period in 2005. Oil
production volumes were 38,223 barrels for the nine-month period
ended September 30, 2006, compared to 300 barrels during the same
period in 2005. For the nine-month period ending September 30,
2006, Kodiak produced 53,834 barrels of oil equivalent using a
conversion rate of 6 Mcf gas to each barrel of oil. Gas price
realizations decreased 16.5% to $5.96 per Mcf for the nine-month
period ended September 30, 2006, compared to the same period in
2005. Oil price realizations decreased 1.42% to $58.93 per barrel
for the period ended September 30, 2006. Kodiak's production is
currently unhedged. As of September 30, 2006, Kodiak had working
capital of $21,025,000 with no long-term debt. During the nine-
month period ended September 30, 2006, the Company invested
$22,111,000 for exploration and development of its leasehold.
Results are presented for the nine-month period because comparisons
to the year-ago quarterly period are skewed by the capital the
Company has raised and the investment in developing its properties.
Kodiak will present quarterly comparisons as they become a more
meaningful way to assess financial and operational performance and
expected growth. Management Comments Commenting on today's results,
Lynn Peterson, Kodiak's President and CEO said: "We have continued
to increase our revenues each of the three quarters of 2006 as we
progress in developing our leasehold. With our recent discoveries
in the Williston Basin we would expect that trend to continue into
the fourth quarter. The importance of our Williston oil plays is
evident in the cash flow it throws off at historically high oil
prices. "In the Vermillion Basin in Wyoming, the North Trail State
#4-36 well is drilling below 9,200 feet and we anticipate entering
the over-pressured pay in the coming week. This is our first well
drilled in the highly over-pressured Baxter Shale and Frontier and
Dakota Sands and we are pleased with our progress to date. With $21
million in cash at September, 30, 2006, and zero debt, Kodiak is
well-positioned to fund its remaining 2006 CAPEX program and into
the first half of 2007. We expect to fund the 2007 CAPEX through a
combination of cash on hand, cash flow, access to a reserve-based
revolving line of credit which we intend to establish by year-end,
and the equity markets." About Kodiak Oil & Gas Corp. Kodiak
Oil & Gas, headquartered in Denver, is an independent energy
exploration and development company focused on exploring,
developing and producing oil and natural gas in the Williston and
Green River Basins in the U.S. Rocky Mountains. For further
information, please visit http://www.kodiakog.com/. The common
shares of the Company are listed for trading on the American Stock
Exchange and the TSX Venture Exchange under the symbol "KOG."
Forward-Looking Statements This press release includes statements
that may constitute "forward-looking" statements, usually
containing the words "believe," "estimate," "project," "expect" or
similar expressions. These statements are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. Forward-looking statements are
statements that are not historical facts and are generally, but not
always, identified by the words "expects," "plans," "anticipates,"
"believes," "intends," "estimates," 'projects," "potential" and
similar expressions, or that events or conditions "will," "would,"
"may," "could" or "should" occur. Information inferred from the
interpretation of drilling results may also be deemed to be
forward-looking statements, as it constitutes a prediction of what
might be found to be present when and if a well is actually
developed. Forward-looking statements in this document include
statements regarding the Company's exploration, drilling and
development plans, the Company's expectations regarding the timing
and success of such programs, and the Company's expectations
regarding production from its Williston property. Factors that
could cause or contribute to such differences include, but are not
limited to, fluctuations in the prices of oil and gas,
uncertainties inherent in estimating quantities of oil and gas
reserves and projecting future rates of production and timing of
development activities, competition, operating risks, acquisition
risks, liquidity and capital requirements, the effects of
governmental regulation, adverse changes in the market for the
Company's oil and gas production, dependence upon third-party
vendors, and other risks detailed in the Company's periodic report
filings with the Securities and Exchange Commission. The TSX
Venture Exchange does not accept responsibility for the adequacy or
accuracy of this release. [Financial and Operational Tables
Accompany this News Release] The notes accompanying the financial
statements are an integral part of the consolidated financial
statements and can be found in Kodiak's filing on Form 10-Q for the
period ended September 30, 2006. KODIAK OIL & GAS CORP BALANCE
SHEET UNAUDITED AUDITED September 30, December 31, ASSETS 2006 2005
Current assets: Cash and cash equivalents $21,432,860 $7,285,548
Accounts receivable Trade 1,126,530 447,981 Accrued Sales 430,659
226,406 Prepaid expenses and other 138,092 30,631 Total Current
Assets 23,128,141 7,990,566 Property and equipment (full cost
method), at cost: Proved oil and gas properties 26,191,988
11,277,307 Unproved oil and gas properties 12,010,614 6,307,903
Less-accumulated depletion, depreciation and amortization
(1,443,314) (121,941) 36,759,288 17,463,269 Other property and
equipment, net of accumulated depreciation of $95,904 in 2006 and
$47,525 in 2005 158,561 183,481 Restricted Investment 217,400
153,000 Total Assets $60,263,390 $25,790,316 LIABILITIES AND
STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable and
accrued liabilities $2,103,383 $4,411,572 Noncurrent liabilities:
Asset retirement obligation 159,065 69,073 Total Liabilities
2,262,448 4,480,645 Commitments and Contingenicies - Note 7
Stockholders' equity: Common stock, $0.01 par value: authorized -
100,000,000 Issued: 74,969,426 shares in 2006 and 54,547,158 in
2005 749,694 545,472 Additional paid in capital 64,483,787
26,593,826 Accumulated deficit (7,232,539) (5,829,627) Total
Stockholders' Equity 58,000,942 21,309,671 Total Liabilities and
Stockholders' Equity $60,263,390 $25,790,316 KODIAK OIL & GAS
CORP. STATEMENT OF OPERATIONS (UNAUDITED) Three months ended Nine
months ended September 30, September 30, 2006 2005 2006 2005
Revenues: Gas production $143,504 $65,315 $558,768 $78,860 Oil
production 897,085 22,656 2,252,499 22,656 Interest 232,446 39,402
599,285 70,727 Total revenue 1,273,035 127,373 3,410,552 172,243
Cost and expenses: Oil and gas production 194,021 55,693 543,681
130,039 Depletion, depreciation, amortization and abandonment
liability accretion 494,829 15,287 1,374,019 29,019 General and
administrative 980,100 289,791 3,270,534 891,263 Gain on currency
exchange (6,627) (181,146) (374,770) (9,868) Total costs and
expenses 1,662,323 179,625 4,813,464 1,040,453 Net loss for the
period $(389,288) $(52,252) $(1,402,912) $(868,210) Basic &
diluted weighted-average common shares outstanding 74,939,654
44,825,221 69,706,082 42,825,894 Basic & diluted net loss per
common share $(0.01) $(0.00) $(0.02) $(0.02) KODIAK OIL & GAS
CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months
Ended September 30, 2006 2005 Cash flows from operations Net loss
$(1,402,912) $(868,210) Reconciliation of net loss to net cash
provided by operating activities: Depletion, depreciation,
amortization and abandonment liability accretion 1,374,019 29,019
Stock based compensation 1,372,152 -- Changes in currrent assets
and liabilites Accounts receivable-Trade (678,549) (19,362)
Accounts receivable-Accrued Sales (204,253) (127,100) Prepaid
expenses and other (107,462) (599,462) Accounts payable (728,440)
27,005 Net cash used by operating activities (375,445) (1,558,110)
Cash flows from investing activities Oil and gas properties
(22,111,417) (4,852,896) Equipment (23,457) (76,512) Restricted
investment: designated as restricted (53,800) -- Restricted
investment: undesignated as restricted (10,600) -- Net cash used
for investing activities (22,199,274) (4,929,408) Cash flows from
financing activity Proceeds from the issuance of shares 39,631,329
9,679,567 Issuance costs (2,909,298) (292,370) Net cash provided by
financing activities 36,722,031 9,387,197 Net change in cash and
cash equivalents 14,147,312 2,899,679 Cash and cash equivalents at
beginning of the period 7,285,548 2,707,763 Cash and cash
equivalents at end of the period $21,432,860 $5,607,442 Non-cash
Items Oil & Gas Property accrual included in Accounts Payable
$1,726,890 $325,570 Asset retirement obligation $85,725 $-- Product
Volumes and Prices Three months ended Nine months ended September
30, September 30, 2006 2005 2006 2005 Volume: Gas (Mcf) 36,434
23,030 93,721 28,907 Oil (Bbls) 14,316 300 38,223 300 Price: Gas
(Mcf) $5.02 $5.43 $5.96 $7.14 Oil (Bbls) $62.66 $59.78 $58.93
$59.78 DATASOURCE: Kodiak Oil & Gas Corp. CONTACT: Mr. Lynn A.
Peterson, President of Kodiak Oil & Gas Corp., +1-303-592-8075;
or Mr. David Charles of EnerCom, Inc. +1-303-296-8834, for Kodiak
Oil & Gas Corp.; or Ms. Heather Colpitts, Associate Account
Manager of CHF Investor Relations, +1-416-868-1079, ext. 223, for
Kodiak Oil & Gas Corp. Web site: http://www.kodiakog.com/
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