GME Geomark Exploration Ltd.

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED
STATES


Geomark Exploration Ltd. (TSX VENTURE:GME) (Geomark or the Company) is pleased
to announce its operating and financial results for the three months and six
months ended June 30, 2012. The quarterly report is summarized in this release,
with the complete version of the related condensed consolidated financial
statements and notes, as well as management's discussion and analysis, available
on the System for Electronic Document Analysis and Retrieval (SEDAR) at
www.sedar.com and on Geomark's website at www.geomark.ca 


Financial and Operational Highlights



As at and for the periods ended      Three Months ended   Six Months ended  
----------------------------------------------------------------------------
                                     June 30,  June 30,  June 30,  June 30, 
                                         2012      2011      2012      2011 
----------------------------------------------------------------------------
Financial ($ 000s, except $ per                                             
 share)                                                                     
Revenue                                                                     
  Mineral Division(1)                     170       177       339       352 
  Oil and Gas Division                    893       547     1,419       961 
Funds Flow(2)                              69       270       320       392 
  Per Share Basic and Diluted            0.00      0.01      0.01      0.01 
Cash Flow (Deficiency) From                                                 
 Operations                              (227)      (24)     (272)     (186)
  Per Share Basic and Diluted           (0.00)    (0.00)    (0.01)    (0.00)
Net Earnings                              629       141       659       114 
  Per Share Basic and Diluted            0.01      0.00      0.01      0.00 
Capital Expenditures                                                        
  Mineral Division                        431       616       458     1,292 
  Oil and Gas Division                      3        10        20        15 
Total Assets                                                                
  Mineral Division                                         41,091    41,170 
  Oil and Gas Division                                     11,617    13,589 
----------------------------------------------------------------------------
Oil and Gas Operations                                                      
Barrels of Oil Equivalent (BOE) per                                         
 day(3)                                   122       124       123       131 
----------------------------------------------------------------------------
(1) Geomark is a junior mineral exploration company with mineral revenue    
    currently from non-production sources.                                  
(2) Funds flow is not a recognized measure under IFRS. For these purposes,  
    the Company defines funds flow as funds provided by operations after    
    including investment dividend and interest income and the changes in    
    non-cash investing working capital related to these sources of          
    investment income.                                                      
(3) Barrels of Oil Equivalent (BOE) are calculated using a conversion ratio 
    of 6 MCF to 1 barrel of oil. The conversion is based on an energy       
    equivalency conversion method primarily applicable at the burner tip and
    does not represent a value equivalency at the wellhead and as such may  
    be misleading if used in isolation.                                     



Business Development



--  Geomark's business strategy continues to be by acquisitions or joint
    venture arrangement whereby the Company will have majority interests in
    either early stage or smaller advanced stage precious metal properties.
    The Company has been selective with regard to the geological potential
    of the various exploration plays compared to the overall deal terms.

--  During the second quarter, Geomark acquired a 100 percent working
    interest in the Kings Canyon gold property in southwest Utah. These
    properties cost Cdn $325,000. They have net smelter royalties on them
    that range from two to five percent. The purchase includes the right to
    assume an existing option to acquire a 100 percent interest in a claim
    block (and historical gold resource) by paying U.S. $1.0 million to the
    option holder prior to December 6, 2013. The option property carries two
    net smelter royalties totaling five percent. 

--  Geomark's goal with the Kings Canyon property is to develop a critical
    mass of near surface, low grade gold mineralization of sufficient size
    to justify a low cost heap leaching operation. Several zones of gold
    mineralization, located outside of the existing resource, have been
    identified on the claim block and the property has good exploration
    potential. As such, the Company initiated a drilling program in late
    July 2012 which is currently ongoing. 

--  The drilling contractor has mobilized a Schramm 450 reverse circulation
    drill to the Kings Canyon property. A minimum drill program of 5,000
    metres is planned for the first phase of drilling. A total of 11 holes
    (approximately 1,500 metres) has been completed as of August 9, 2012.
    Samples will be assayed and results for the first batch are expected in
    September.

--  The main objective of the Phase 1 program is to extend the strike of
    known mineralization in the two main zones identified on the property;
    the Crown and Royal Zones. Meterage has also been allocated to screen
    prospective areas for new mineralized zones. The Phase 1 drilling is
    expected to be completed by mid to late September and based on those
    results a second Phase 2 program may be initiated later in the fall.

--  During the quarter, Geomark also conducted a geophysical program on two
    of its Ontario gold properties, Whitney and Tisdale. After an initial
    review of the results, no drilling is planned in the near future.



Financial



--  Geomark currently has a positive working capital position of
    approximately $39.3 million with additional very liquid investments
    presently valued at approximately $9.9 million (total of $49.2M in cash
    and investments). Cash flow derived from its oil and gas production,
    dividends and interest income will cover all general and administrative
    costs on a yearly basis and as well will be used towards exploration
    expenses and potential property acquisitions. 



Outlook



--  Geomark is a well-financed exploration company with proven management,
    experienced staff, a large cash position and immediate cash flow from
    its oil and gas and investment assets. The Company's main focus in the
    minerals sector is its exploration activities on the Kings Canyon gold
    property while also continuing to assess additional properties and their
    potential opportunities. 

--  The Company's current focus is in the southwest United States where
    possible synergies to its Kings Canyon property may be realized.
    Continued volatility in the world's economies has restricted the flow of
    equity to junior exploration companies and Geomark's solid financial
    position remains a highly competitive advantage in the acquisitions
    marketplace. 

--  The Board and management, however, recognize that the Company's share
    price has gone down over the past year to the point where it is trading
    well below net asset value. Some of the reduction may be attributable to
    general market conditions but the Company is also taking a proactive
    perspective and is evaluating various investment opportunities to assist
    in maximizing the rate of return from its significant cash balance and
    investment assets.



Cautionary Statement

This summarized news release should not be considered a suitable source of
information for readers who are unfamiliar with Geomark Exploration Ltd. and
should not be considered in any way as a substitute for reading the full report.



For the full report, please go to www.geomark.ca 

Use of non-IFRS financial measures 

Included in this report we use the term "funds flow" to analyze the Company's
operating performance. Funds flow is not a standardized measure recognized under
IFRS and does not have a standardized meaning prescribed by IFRS. This funds
flow calculation is considered by management to be informative for shareholders
and analysts. This measure may differ from those made by other companies and
accordingly may not be comparable to such measures as reported by other
companies. 


Geomark's funds flow is calculated by adding investment dividend and interest
income and the changes in non-cash investing working capital related to these
sources of investment income to cash flow (deficiency) from operating
activities. 


Forward-Looking Statements 

Certain statements contained in this report include statements which contain
words such as "anticipate", "could", "should", "expect", "seek", "may",
"intend", "likely", "will", "believe" and similar expressions, statements
relating to matters that are not historical facts, and such statements of our
beliefs, intentions and expectations about development, results and events which
will or may occur in the future, constitute "forward-looking information" within
the meaning of applicable Canadian securities legislation and are based on
certain assumptions and analysis made by us derived from our experience and
perceptions. Forward-looking information in this report includes, but is not
limited to: expected cash provided by continuing operations; future capital
expenditures, including the amount and nature thereof; mineral prices and
demand, oil and natural gas prices and demand; expansion and other development
trends of the mineral and oil and gas industry; business strategy and outlook;
expansion and growth of our business and operations; and maintenance of existing
customer, supplier and partner relationships; supply channels; accounting
policies; credit risks; and other such matters.


All such forward-looking information is based on certain assumptions and
analyses made by us in light of our experience and perception of historical
trends, current conditions and expected future developments, as well as other
factors we believe are appropriate in the circumstances. The risks,
uncertainties, and assumptions are difficult to predict and may affect
operations, and may include, without limitation: foreign exchange fluctuations;
equipment and labour shortages and inflationary costs; general economic
conditions; industry conditions; changes in applicable environmental, taxation
and other laws and regulations as well as how such laws and regulations are
interpreted and enforced; the ability of mineral companies to raise capital; the
effect of weather conditions on operations and facilities; the existence of
operating risks; volatility of oil and natural gas prices; oil and gas product
supply and demand; risks inherent in the ability to generate sufficient cash
flow from operations to meet current and future obligations; increased
competition; stock market volatility; opportunities available to or pursued by
us; and other factors, many of which are beyond our control. The foregoing
factors are not exhaustive.


Actual results, performance or achievements could differ materially from those
expressed in, or implied by, this forward-looking information and, accordingly,
no assurance can be given that any of the events anticipated by the
forward-looking information will transpire or occur, or if any of them do, what
benefits will be derived therefrom. Except as required by law, Geomark disclaims
any intention or obligation to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise. 


The forward-looking information contained herein is expressly qualified by this
cautionary statement.

Geomark Exploration Ltd. (TSXV:GME)
Historical Stock Chart
From May 2024 to Jun 2024

Geomark Exploration Ltd. (TSXV:GME)
Historical Stock Chart
From Jun 2023 to Jun 2024