KNOXVILLE, Tenn., Nov. 14, 2013 /PRNewswire/ -- Tengasco, Inc. (NYSE MKT: TGC) announced today its financial results for the quarter ended September 30, 2013. The Company reported net income from continuing operations of $535,000 or $0.01 per share of common stock during the third quarter of 2013 compared to net income from continuing operations of $1,279,000 or $0.02 per share of common stock during the third quarter of 2012.
The Company recognized $4.0 million in revenues during the third quarter of 2013 and $5.8 million during the third quarter of 2012. The revenue decrease from 2012 levels was primarily due to a $2.2 million decrease related to a 26 MBbl decrease in Kansas oil sales volumes, partially offset by $0.5 million increase related to a $13.71 per barrel increase in the average oil price. Kansas oil prices during the third quarter of 2013 averaged $99.01 per barrel compared to an average price of $85.30 per barrel during the third quarter of 2012. Although revenues decreased $1.8 million, this decrease was partially offset by a $426,000 decrease in general and administrative cost, a $269,000 decrease in depreciation, depletion, and amortization, an $186,000 decrease in operating cost, and an $112,000 decrease in interest expense.
The Company recognized $12.2 million in revenues during the first nine months of 2013 compared to $16.0 million during the first nine months of 2012. The revenue decrease from 2012 levels was primarily due to a $3.9 million decrease related to a 44 MBbl decrease in Kansas oil sales volumes, a $198,000 decrease in methane plant sales due to increased downtime at the facility, partially offset by a $314,000 increase related to a $2.42 per barrel increase in average Kansas oil prices. Kansas oil prices during the first nine months of 2013 averaged $91.00 per barrel compared to an average price of $88.58 per barrel during the first nine months of 2012. The Company reported net income from continuing operations of $2.3 million or $0.04 per share of common stock during the first nine months of 2013 compared to net income from continuing operations of $3.4 million or $0.06 per share of common stock during the first nine months of 2012. Although revenues decreased $3.8 million, this decrease was partially offset by a $1.2 million decrease in operating cost, an $806,000 decrease in general and administrative cost, a $301,000 decrease in depreciation, depletion and amortization, a $266,000 decrease in interest expense, and a $140,000 decrease in loss on derivatives.
Mike Rugen, the company's CFO and interim CEO, said, "Two oil tests were drilled by the Company in Rooks County, Kansas in the third quarter and had pipe set to further test the Arbuckle. The Zerger A #2 and Veverka B #6, both in the Webster Field, exhibited the typical high fluid volumes with low oil percentage. These wells will have final completion with a polymer gel treatment to decrease water volume and increase oil percentage. Polymer gel treatments have been used extensively in this area by the Company with good results. Both of these locations were selected based on 3D seismic. Two additional locations in Kansas have been permitted with drilling scheduled for November of this year. One location in southwest Trego County will test a 3D seismic feature in the Mississippian Warsaw Formation. The Albers C #1 is due west of our Albers A and Albers B leases which also produce from the Mississippian Warsaw Formation. A second location in the Webster Field in Rooks County, the Veverka D #3, will test a 3D seismic feature in the Arbuckle Formation. The Company plans to continue to focus on its Kansas assets while expanding its operations personnel, which would increase the Company's ability to evaluate and pursue new opportunities to increase production, revenues, profitability, and reserve value."
Forward-looking statements made in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements involve risk and uncertainties which may cause actual results to differ from anticipated results, including risks associated with the timing and development of the Company's reserves and projects as well as risks of downturns in economic conditions generally, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.
SOURCE Tengasco, Inc.