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U.S. Energy Corp. Reports Second Quarter 2013 Highlights and Selected Financial Results

U.S. Energy Corp. Reports Second Quarter 2013 Highlights and Selected
Financial Results

Provides an Operational Update

RIVERTON, Wyo., Aug. 8, 2013 (GLOBE NEWSWIRE) -- U.S. Energy Corp.
(Nasdaq:USEG) (the "Company"), today reported its second quarter 2013
highlights and selected financial results for the three and six months ended
June 30, 2013, and also provided an operational update.

Selected highlights for the three and six months ended June 30, 2013

Financial and Operational Results

  *During the quarter ended June 30, 2013, the Company recorded net income
    after taxes of $573,000, or $0.02 per share basic and diluted, as compared
    to a net loss after taxes of $990,000, or $0.04 per share basic and
    diluted, during the same period of 2012.
  *On June 20, 2013, the Company announced the successful completion of the
    Beeler #2H well at a gross initial production rate of 859 BOE/D. The
    Beeler #2H is the Company's first participated well in Dimmit County,
    Texas targeting the Buda Limestone formation. The Company has an
    approximate 30% working interest and an approximate 22.8% net revenue
    interest in the Booth Tortuga acreage block.
  *Oil and Gas operations produced operating income of $2.1 million during
    the quarter ended June 30, 2013 as compared to operating income (before
    impairment of $523,000) of $1.9 million during the quarter ended June 30,
    2012.
  *During the three months ended June 30, 2013, the Company produced 101,026
    BOE, or 1,110 BOE/D from 92 gross (15.76 net) wells.
  *At June 30, 2013, the Company had $4.1 million in cash and cash
    equivalents on hand. Working capital (current assets minus current
    liabilities) was $12.8 million.
  *The Company recognized $15.8 million in revenues during the six months
    ended June 30, 2013.
  *During the six months ended June 30, 2013, we received average revenue of
    $2.6 million per month from our producing wells with an average operating
    cost of $622,000 per month (excluding workover costs), and production
    taxes of $272,000 before non-cash depletion expense, for an average cash
    flow of $1.7 million per month from oil and gas production before non-cash
    depletion expense.
  *General and administrative expenses decreased by $1.0 million during the
    six months ended June 30, 2013 as compared to general and administrative
    expenses for the six months ended June 30, 2012.
  *Earnings before interest, income taxes, depreciation, depletion and
    amortization, accretion of discount on asset retirement obligations,
    non-cash impairments, unrealized derivative gains and losses and non-cash
    stock compensation expense ("Modified EBITDAX"), was $8.0 million for the
    six months ended June 30, 2013, an increase of 13.4% from $7.1 million for
    the same period in 2012. Modified EBITDAX is a non-GAAP financial
    measure.Please refer to the reconciliation in this release for additional
    information about this measure.*

Operations Update

South Texas - Buda Limestone formation

Booth-Tortuga Prospect

The Company participates in approximately 10,140 gross acres in the
Booth-Tortuga acreage block in Dimmit County, Texas which are prospective for
the Buda Limestone formation. The Company has an approximate 30% working
interest and a 22.8% net revenue interest in the acreage.

The Beeler #2H well, our first Buda Limestone formation targeted well, was
drilled to a total measured depth of 11,013 feet, including an approximate
3,700 foot lateral.The well has produced approximately 57,500 gross BOE
during the first 83 days of production (last reported), or an average of 693
gross (158 net to USEG) BOE/D during that period. During July, the well has
averaged 597 gross (136 net to USEG) BOE/D.

Additionally, the Beeler #3H well was spud on August 3, 2013 and is currently
being drilled at a depth of 3,245 feet with drilling and completion operations
expected to be completed in early September.The operator expects the rig
drilling this well to remain active in the area for the rest of the year.

Williston Basin, North Dakota

Bakken and Three Forks formations

The Young 31-30 #1H well (Bakken Formation) was completed with 35 fracture
stimulation stages in late July 2013. The well had an early 24-hour flow back
rate of 1,721 BOE/D. The initial production rate consisted of approximately
1,509 barrels of oil and 1,275 MCF of natural gas. The Company has an
approximate 2.69% WI and 2.07% NRI in this well.

The Mongoose 1-8-5H well (Bakken Formation) was completed with 35 fracture
stimulation stages in June with an initial peak 24 hour production rate of
1,523 BOE/D. The well produced 26,773 gross BOE during the first 30 days of
production or an average of 892 BOE/D. The Company has an approximate 0.29%
working interest and a 0.23% net revenue interest in the well.

The Talon 1-9-4H well and the Slugger 1-16-21H wells were both completed in
July on the same pad location.Both wells were completed with 34 stages.The
operator is currently drilling out the plugs on both wells in order to turn
the wells over to production.The Company has an approximate 0.27% and 0.36%
working interest and a 0.21% and 0.28% net revenue interest in the wells,
respectively.

Williston Basin Wells in Progress:

Well Name            Operator    Formation   Working  Net Revenue Status
                                             Interest Interest
Van Hook 126-2523H   EOG         Bakken      0.36%    0.27%       Producing -
                     Resources                                    TBA
Van Hook 19-2523H    EOG         Bakken      0.36%    0.27%       Producing -
                     Resources                                    TBA
State 36-1 #4TFH     Statoil     Three Forks 3.64%    2.88%       Completing
Gene Zumhof Federal  Oasis       Three Forks 0.41%    0.31%       Completing
5300 11-23T          Petroleum
Talon 1-9-4H        Emerald Oil Bakken      0.27%    0.21%       Completing
                     Inc.
Slugger 1-16-21H     Emerald Oil Bakken      0.36%    0.28%       Completing
                     Inc.
                                                                  Drilled -
Hovde 33-4 #3TFH     Statoil     Three Forks 2.45%    1.94%       completion
                                                                  pending
                                                                  Drilled -
Hovde 33-4 2TFH      Statoil     Three Forks 2.47%    1.95%       completion
                                                                  pending
Excalibur 2-25-36H   Emerald Oil Bakken      0.82%    0.61%       Drilling
                     Inc.
Wayne Zumhof Federal Oasis       Three Forks 4.33%    3.24%       Drilling
5300 44-15T          Petroleum
                                                                  Scheduled to
Hovde 33-4 #4H       Statoil     Bakken      2.45%    1.94%       spud August
                                                                  2013
                               Average:    1.63%    1.26%       

Mount Emmons Molybdenum Project

On April 22, 2013, the Company received a letter from the U.S. Forest Service
notifying the Company that it had completed a review of the Mine Plan of
Operations ("MPO") for the Mount Emmons Molybdenum Project in Colorado and
that it has determined that the MPO "does contain sufficient information and
clarity to form the basis for a proposed action to initiate scoping and
analysis under the National Environmental Policy Act."The letter also states,
"U.S. Energy has met the requirements of the Reality Check provision granting
conditional water rights for the Mt. Emmons Molybdenum Project by filing the
Plan for the Mt. Emmons Mine with the Forest Service.No other special use
permits or rights-of-way for the water facilities are required because they
are addressed in the Plan."The MPO provides an in-depth description of the
proposed construction, mining, processing, and reclamation operations for the
Project.

The Company has initiated a scoping analysis of the MPO with the U.S. Forest
Service and anticipates that such work will continue through the balance of
2013.

Remington Village

On March 5, 2013, the Company entered into a Purchase and Sale Agreement with
an undisclosed buyer to sell its Remington Village apartment complex located
in Gillette, Wyoming for $15.0 million.The transaction is now anticipated to
close on or before September 20, 2013, subject to due diligence and the
purchaser's ability to obtain an acceptable loan commitment for the proposed
acquisition of the property.

CEO Statement

"We are very pleased to be moving forward with our next Buda Limestone well in
the Booth-Tortuga acreage block in South Texas.We have meaningful interests
in the prospect and the production to date from our first Buda well has been
very encouraging," said Keith Larsen, CEO of U.S. Energy Corp."Management is
also pleased that Crimson is determined to keep its rig active in the
Booth-Tortuga acreage through the balance of 2013.This program has the
potential to provide a growth catalyst for the Company and its shareholders,
and if the next several Buda wells perform in a similar fashion, it is
possible that drilling could accelerate even further next year," he added.

Financial Highlights

The following table sets forth selected financial information for the three
and six months ended June 30, 2013 and 2012.This information is derived from
the financial statements filed with Company's Form 10-Q for the six months
ended June 30, 2013, and should be read in conjunction with the financial
statements contained therein, including the notes to the financial statements.

                                   
U.S. ENERGY CORP.
CORPORATE PRESENTATIONS
(Unaudited)
(Amounts in thousands, except per share amounts)
                                   
                         June 30,   December 31,
                         2013       2012
Balance Sheets:                     
Cash and cash equivalents $ 4,141    $ 2,825
Current assets            $ 26,141   $ 26,015
Current liabilities       $ 13,338   $ 13,253
Working capital           $ 12,803   $ 12,762
Total assets              $ 135,616  $ 140,827
Long-term obligations     $ 11,475   $ 11,457
Shareholders' equity      $ 110,803  $ 116,117
                                   
Shares Outstanding        27,682,602 27,652,602

                                                               
                     For the three months ended June For the six months ended
                      30,                             June 30,
                     2013            2012            2013         2012
Statements of                                                   
Operations:
Operating revenues    $7,915        $8,522        $15,794    $16,857
Income (loss) from    $118          $(991)        $(6,042)   $(1,703)
continuing operations
Other income &        $249          $1,615        $279       $1,494
expenses
(Provision for)
benefit from income   $--          $(379)        $--       $9
taxes
Discontinued
operations, net of    $206          $(1,235)      $438       $(1,171)
taxes
Net income (loss)     $573          $(990)        $(5,325)   $(1,371)
Net income (loss) per                                           
share
Basic and diluted     $0.02         $(0.04)       $(0.19)    $(0.05)
Weighted average                                                
shares outstanding
Basic and diluted     27,682,272     27,460,483     27,674,729  27,449,534

*Non-GAAP Financial Measures

Modified EBITDAX

In addition to reporting net income (loss) as defined under GAAP, in this
release we also present net earnings before interest, income taxes,
depreciation, depletion, and amortization, accretion of discount on asset
retirement obligations, non-cash impairments, unrealized derivative gains and
losses and non-cash stock compensation expense ("Modified EBITDAX"), which is
a non-GAAP performance measure.Modified EBITDAX excludes certain items that
the Company believes affect the comparability of operating results and can
exclude items that are generally one-time or whose timing and/or amount cannot
be reasonably estimated. Modified EBITDAX is a non-GAAP measure that is
presented because the Company believes that it provides useful additional
information to investors, as a performance measure.Modified EBITDAX does not
represent, and should not be considered an alternative to, GAAP measurements,
such as net income (loss) (its most directly comparable GAAP measure), or as a
measure of liquidity, and our calculations thereof may not be comparable to
similarly titled measures reported by other companies.We also believe that
Modified EBITDAX is useful to investors because similar measures are
frequently used by securities analysts, investors, and other interested
parties in their evaluation of companies in similar industries.Our management
uses Modified EBITDAX to manage our business, including preparation of our
annual operating budget and financial projections.Our management does not
view Modified EBITDAX in isolation and also uses other measurements, such as
net income (loss) and revenues, to measure operating performance.The
following table provides a reconciliation of net income (loss) to Modified
EBITDAX for the periods presented (in thousands):

                                                               
                          For the three months ended For the six months ended
                           June 30,                   June 30,
                          2013          2012         2013         2012
Net (loss) income          $573        (990)       (5,325)     (1,371)
Impairment of oil and      --          523         5,828       523
natural gas properties
Impairment of Remington    --          1,261       --         1,261
Village, net of tax
Accretion of asset         10           7           19          16
retirement obligation
Non-cash compensation      122          150         249         320
expense
Unrealized (gain) loss on  (328)        (1,770)     288         (1,711)
commodity derivates
(Benefit from) provision   --          379         --         (9)
for income taxes
Interest expense           78           36          158         75
Depreciation, depletion    3,282        4,182       6,814       7,980
and amortization
Modified EBITDAX           $3,737      $3,778     $8,031     $7,084
(Non-GAAP) ^(1)

About U.S. Energy Corp.

U.S. Energy Corp. is a natural resource exploration and development company
with a primary focus on the exploration and development of its oil and gas
assets.The Company also owns the Mount Emmons molybdenum deposit located in
west central Colorado.The Company is headquartered in Riverton, Wyoming and
trades on the NASDAQ Capital Market under the symbol "USEG".

To view the Company's Financial Statements and Management's Discussion and
Analysis, please see the Company's 10-Q for the three and six months ended
June 30, 2013 which is available at www.sec.gov and www.usnrg.com.

The U.S. Energy Corp. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=5043

                Disclosure Regarding Forward-Looking Statement

This news release includes statements which may constitute "forward-looking"
statements, usually containing the words "will," "anticipates," "believe,"
"estimate," "project," "expect," "target," "goal," or similar
expressions.Forward looking statements in this release relate to, among other
things, U.S. Energy's expected future production and capital expenditures and
projects, its drilling and fracing of wells with industry partners and
potential additional drilling opportunities, its ownership interests in those
wells, the oil and natural gas targets or goals for the wells, future capital
expendituresand projects, future expenses, production, costs and sale
transactions, and activities relating to the Mount Emmons project.There is no
assurance that any of the wells referenced in this press release will be
economic.Initial and current production results from a well are not
necessarily indicative of its longer-term performance.Future transactions may
not close on the terms we anticipate or at all. Results from exploration and
development activities conducted on properties near properties in which the
Company has an interest may not be indicative of the results the Company will
generate from its properties or the value of those properties.There is no
assurance that the Remington Village sale transaction will close on the
expected timeline, terms, or at all.The forward-looking statements are made
pursuant to the safe harbor provision 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.Factors that would cause or contribute to such
differences include, but are not limited to, dry holes and other unsuccessful
development activities, higher than expected expenses or decline rates from
production wells, future trends in commodity and/or mineral prices, the
availability of capital, competitive factors, and other risks described in the
Company's filings with the SEC (including, without limitation, the Form 10-K
for the year ended December 31, 2012 and the Form 10-Q for the quarter ended
June 30, 2013) all of which descriptions are incorporated herein by
reference.By making these forward-looking statements, the Company undertakes
no obligation to update these statements for revision or changes after the
date of this release.

CONTACT: Reggie Larsen
         Director of Investor Relations
         U.S. Energy Corp.
         1-800-776-9271
         Reggie@usnrg.com

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