Royale Energy Inc. (ROYL, Financial) filed Quarterly Report for the period ended 2009-09-30.
ROYALE ENERGY INC. is an independent oil and gas producer. Their principal lines of business include the acquisition of oil and natural gas lease interests and proved reserves drilling of both exploratory and development wells sales of fractional working interests in wells to be drilled by the company and marketing of natural gas. They own wells and leases in major geological basins located in Texas and California. Royale Energy Inc. has a market cap of $22.4 million; its shares were traded at around $2.63 with and P/S ratio of 1.1.
In the first nine months of 2009, revenues from oil and gas production decreased $3,699,857 or 63.4% to $2,135,421 from 2008 revenues of $5,835,278, due to lower prices received for our oil and natural gas production. The net sales volume of natural gas for the nine months ended September 30, 2009, was approximately 460,675 Mcf with an average price of $3.96 per Mcf, versus 535,777 Mcf with an average price of $9.13 per Mcf for the first nine months of 2008. This represents a decrease in net sales volume of 75,102 Mcf or 14%, mainly due to the natural declines in production from existing wells. For the quarter ended September 30, 2009, we produced 137,885 Mcf with an average price of $3.94 per Mcf versus 158,323 Mcf produced during the same quarter in 2008 with an average price of $8.31 per Mcf, which represents a 20,438 Mcf or 12.9% decrease in net sales volume. The net sales volume for oil and condensate (natural gas liquids) was 6,403 barrels with an average price of $48.55 per barrel for the first nine months of 2009, compared to 9,029 barrels at an average price of $104.77 per barrel for the first nine months in 2008. This represents a decrease in net sales volume of 2,626 barrels, or 29.1%. For the third quarter of 2009, oil and condensate produced decreased 578 barrels, or 22%, from 2,623 barrels produced in 2008 to 2,045 barrels produced in the same period in 2009. This decrease was mainly due to the natural declines in production from existing wells.
For the nine months ended September 30, 2009, turnkey drilling revenues decreased $4,064,292 or 64.8% to $2,205,253 from $6,269,545 during the same period in 2008. We also had a $2,032,993 or 69.5% decrease in turnkey drilling and development costs to $893,386 in 2009 from $2,926,379 in 2008. In the third quarter of 2009, turnkey drilling revenues decreased $2,621,030 or 86.9% from $3,016,909 during the period in 2008 to $395,879 in 2009. Also, during the second quarter in 2009 we had an adjustment to turnkey drilling costs of $334,150 on previously drilled wells due to lower than anticipated drilling costs. Turnkey drilling revenues decreased due to lower direct working interest sales for the period in 2009 due to the current economic downturn. Turnkey drilling costs decreased due to lower than anticipated costs on wells drilled during 2008 and 2009. In the fourth quarter, we have completed the drilling of one well and have begun drilling another well in California. We expect to drill approximately three to six additional California wells before the end of the year.
General and administrative expenses decreased by $378,084 or 12.4%, from $3,041,235 for the nine months ended September 30, 2008, to $2,663,151 for the period in 2009. Third quarter 2009 general and administrative expense decreased $111,514, or 11% from $1,016,682 in 2008 compared to $905,168 in 2009. These decreases were primarily due to our cost control measures.
At September 30, 2009, our accounts receivable totaled $1,810,330, compared to $3,750,557 at December 31, 2008, a $1,940,227 (51.7%) decrease, primarily due to lower receivables from an industry member participating in wells we drilled at the end of 2008. At September 30, 2009, our accounts payable and accrued expenses totaled $5,636,452, a decrease of $4,683,735 or 45.4% from the accounts payable at December 31, 2008, of $10,320,187. This decrease was due to applying prepaid drilling remittances to trade accounts payable as aided by payments on other trade account payables.
Investing Activities. For the first nine months ending September 30, 2009 and 2008, net cash provided by investing activities amounted to $117,223 and $582,899, respectively, a decrease of $465,676 or 80%. The difference stems from the sale of our Rio Bravo field during the third quarter of 2008. Capital acquisitions of oil and gas properties used $260,792 for the first nine months of 2009, compared to $4,885,213 for the same period in 2008, a $4,624,421 or a 94.7% decrease in cash used. This decreased capital acquisition was due to lower drilling expenditures during the period in 2009. During the third quarter of 2009, the Company liquidated all its Equity Securities. For the first nine months of 2009, its equity sales and purchases generated $330,545. However, for the first nine months of 2008, the Company s equity sales and purchases used $230,799.
Read the The complete Report
ROYALE ENERGY INC. is an independent oil and gas producer. Their principal lines of business include the acquisition of oil and natural gas lease interests and proved reserves drilling of both exploratory and development wells sales of fractional working interests in wells to be drilled by the company and marketing of natural gas. They own wells and leases in major geological basins located in Texas and California. Royale Energy Inc. has a market cap of $22.4 million; its shares were traded at around $2.63 with and P/S ratio of 1.1.
Highlight of Business Operations:
For the nine months ended September 30, 2009, we had a net loss of $2,014,612 compared to a net income of $1,206,261 during the first nine months of 2008, a $3,220,873 difference. Total revenues for the first nine months of 2009 were $4,780,283, a decrease of $7,878,863 or 62.2% from the total revenues of $12,659,146 during the period in 2008. This decrease in revenues was the result of decreases in oil and natural gas commodity prices affecting our oil and natural gas production revenues. The decline in revenues was also the result of lower turnkey drilling revenues due to lower direct working interest sales for the period in 2009. For the quarter ended September 30, 2009 our net loss was $828,825 compared to a net profit of $1,373,491, again as a result of lower oil and natural gas prices and lower turnkey drilling revenues.In the first nine months of 2009, revenues from oil and gas production decreased $3,699,857 or 63.4% to $2,135,421 from 2008 revenues of $5,835,278, due to lower prices received for our oil and natural gas production. The net sales volume of natural gas for the nine months ended September 30, 2009, was approximately 460,675 Mcf with an average price of $3.96 per Mcf, versus 535,777 Mcf with an average price of $9.13 per Mcf for the first nine months of 2008. This represents a decrease in net sales volume of 75,102 Mcf or 14%, mainly due to the natural declines in production from existing wells. For the quarter ended September 30, 2009, we produced 137,885 Mcf with an average price of $3.94 per Mcf versus 158,323 Mcf produced during the same quarter in 2008 with an average price of $8.31 per Mcf, which represents a 20,438 Mcf or 12.9% decrease in net sales volume. The net sales volume for oil and condensate (natural gas liquids) was 6,403 barrels with an average price of $48.55 per barrel for the first nine months of 2009, compared to 9,029 barrels at an average price of $104.77 per barrel for the first nine months in 2008. This represents a decrease in net sales volume of 2,626 barrels, or 29.1%. For the third quarter of 2009, oil and condensate produced decreased 578 barrels, or 22%, from 2,623 barrels produced in 2008 to 2,045 barrels produced in the same period in 2009. This decrease was mainly due to the natural declines in production from existing wells.
For the nine months ended September 30, 2009, turnkey drilling revenues decreased $4,064,292 or 64.8% to $2,205,253 from $6,269,545 during the same period in 2008. We also had a $2,032,993 or 69.5% decrease in turnkey drilling and development costs to $893,386 in 2009 from $2,926,379 in 2008. In the third quarter of 2009, turnkey drilling revenues decreased $2,621,030 or 86.9% from $3,016,909 during the period in 2008 to $395,879 in 2009. Also, during the second quarter in 2009 we had an adjustment to turnkey drilling costs of $334,150 on previously drilled wells due to lower than anticipated drilling costs. Turnkey drilling revenues decreased due to lower direct working interest sales for the period in 2009 due to the current economic downturn. Turnkey drilling costs decreased due to lower than anticipated costs on wells drilled during 2008 and 2009. In the fourth quarter, we have completed the drilling of one well and have begun drilling another well in California. We expect to drill approximately three to six additional California wells before the end of the year.
General and administrative expenses decreased by $378,084 or 12.4%, from $3,041,235 for the nine months ended September 30, 2008, to $2,663,151 for the period in 2009. Third quarter 2009 general and administrative expense decreased $111,514, or 11% from $1,016,682 in 2008 compared to $905,168 in 2009. These decreases were primarily due to our cost control measures.
At September 30, 2009, our accounts receivable totaled $1,810,330, compared to $3,750,557 at December 31, 2008, a $1,940,227 (51.7%) decrease, primarily due to lower receivables from an industry member participating in wells we drilled at the end of 2008. At September 30, 2009, our accounts payable and accrued expenses totaled $5,636,452, a decrease of $4,683,735 or 45.4% from the accounts payable at December 31, 2008, of $10,320,187. This decrease was due to applying prepaid drilling remittances to trade accounts payable as aided by payments on other trade account payables.
Investing Activities. For the first nine months ending September 30, 2009 and 2008, net cash provided by investing activities amounted to $117,223 and $582,899, respectively, a decrease of $465,676 or 80%. The difference stems from the sale of our Rio Bravo field during the third quarter of 2008. Capital acquisitions of oil and gas properties used $260,792 for the first nine months of 2009, compared to $4,885,213 for the same period in 2008, a $4,624,421 or a 94.7% decrease in cash used. This decreased capital acquisition was due to lower drilling expenditures during the period in 2009. During the third quarter of 2009, the Company liquidated all its Equity Securities. For the first nine months of 2009, its equity sales and purchases generated $330,545. However, for the first nine months of 2008, the Company s equity sales and purchases used $230,799.
Read the The complete Report
