Global
Energy Development PLC Mobilizes Rig for First Exploratory Well
on Rio Verde Contract in Colombia
Dallas, Texas -
December 7, 2005 - HKN, Inc.
(AMEX: HEC), announced today that Global Energy Development
PLC, ("Global") has commenced rig mobilization
to the Tilodiran #2 exploratory well within its exclusive
Rio Verde Exploration and Production Concession Contract (the
"Contract") in Colombia. Harken Energy holds 11,892,922
ordinary shares in Global, representing approximately 34%
of Global's issued share capital.
The Contract, which Global
owns 100% of and is subject only to an initial 10.5% royalty,
covers approximately 75,000 acres in the central Llanos region
and currently contains two producing wells, Tilodiran #1 and
Macarenas #1, which were successfully recompleted and brought
onto production in late 2004 and early 2005 respectively.
Cumulative gross production from these two wells has since
been over 87,000 barrels of oil.
The rig mobilization to Tilodiran
#2 at this time represents an acceleration of the work program
required under the terms of the Contract which specifies that
Global must drill the first exploratory well during phase
two which commences in May 2006.
Global has acquired and processed
56 kilometers of new 2D seismic within the Contract area during
2005 and reprocessed 300 kilometers of existing seismic in
order to select optimum drilling locations. Tilodiran
#2 is located approximately 2,200 feet northeast from and
in a geologically favorable position updip to Tilodiran #1.
Global expects to spud Tilodiran #2 in mid to late December
2005.
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries and shareholdings. Additional information
may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q, as amended, for the period ended September
30, 2005. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
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Harken Energy Subsidiary Enters
into Third Coalbed Methane Exploration and Development Agreement
Dallas, Texas
- November 29, 2005 -
HKN, Inc.'s (AMEX: HEC) wholly owned
subsidiary, Gulf Energy Management Company ("GEM"),
has entered into a new agreement for the joint exploration
and development of coalbed methane (CBM) acreage located in
Ohio.
The agreement between GEM
and Ohio Triangle, L.P. was effective on November 21, 2005,
and calls for GEM to purchase a 65% non-operating working
interest in CBM acreage located in Ohio. GEM's
current plans are to drill three core holes commencing by
the end of the first quarter 2006 in Phase I. Based
on favorable results in Phase I, GEM has the option to purchase
approximately 20,000 acres of coal rights and initiate a Pilot
Program in Phase II. Following a review of Phase II
results, GEM has the option to begin a development program
during which GEM would provide 100% funding up to total expenditures
of $7.5 million.
"This new CBM acreage
in Ohio is an excellent strategic fit for our growing portfolio
of CBM acreage and is consistent with our goal of building
stable production and adding reserves to our asset base,"
said Jim Denny, Chief Executive Officer and President of Gulf
Energy Management Company.
Updating the status of GEM's
existing CBM agreements, GEM and its partner, Ute Energy,
completed drilling of three core holes on its Ohio CBM prospect
area and four core holes on its Indiana CBM prospect area
during the third and fourth quarter of 2005. Based on
the results, GEM has elected to fund Phase II of the CBM agreement
in Indiana and plans to drill its first pilot wells during
the first quarter of 2006. Core samples from the Ohio CBM
prospect are in the process of being analyzed. Depending
on final results, GEM may elect to schedule drilling of pilot
wells on its Ohio CBM prospect area during 2006.
"With the initial results
of the core samples from our Indiana prospect now in, we believe
the gas content and economics are sufficient to begin moving
ahead with our first group of five pilot wells in Indiana,"
Denny commented. "Once these wells are in place and
dewatered, we will have our first look at the production and
the upside potential of this prospect."
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q, as amended, for the period ended September
30, 2005. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
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Harken Energy's Subsidiary, Global
Energy Development PLC, Receives New Contract Approval in
Colombia
369,000-acre
Luna Llena Contract within Valle Lunar acreage
Dallas,
Texas - November 23, 2005 - HKN, Inc.
(AMEX: HEC), announced today that Global Energy Development
PLC (‘Global') has received approval for a new
exclusive exploration and production concession contract with
the National Hydrocarbons Agency of the Republic of Colombia
following electing to convert a portion of its Valle Lunar
acreage held under a Technical Evaluation Agreement ("TEA").
Harken Energy currently holds approximately 34% of Global's
issued share capital.
The new Luna Llena Contract, one of six contracts Global now
holds in Colombia, covers 369,000 acres within the approximate
2.1 million acre Valle Lunar TEA, which is located in the
established Llanos Basin of eastern Colombia. The Valle Lunar
TEA, signed on May 2005, grants Global the exclusive option
to convert any of the acreage into a contract or contracts
prior to or at the TEA's conclusion in October 2006.
"The early conversion of the Luna Llena Contract reflects
Global's desire to accelerate its work program on this
selected area due to management's belief that the opportunity
to develop substantial medium heavy oil reserve potential
is significant," said Stephen Voss, Global's Managing
Director.
"Two international oil companies drilled a number of
shallow wells in the 1980s within Luna Llena to a depth of
approximately 3,000 feet which delineated what is now known
to be the El Miedo field. Oil production tests were successful
but the opportunity was deemed non-commercial at the time
due to low oil prices," said Voss.
Since Global signed the Valle Lunar TEA, the company has conducted
Landsat analysis of the acreage, which yielded a considerable
amount of surface data, particularly within the Luna Llena
area, that can be utilized in subsurface interpretation. In
addition, the Luna Llena acreage contains the identified El
Miedo field. The El Miedo field has substantial well tests
and subsurface geologic control that was acquired by two international
oil companies in the 1980s from an extensive drilling effort
conducted by these oil companies. Oil production tests were
successful at that time. Global has already completed engineering
and geologic studies on the El Miedo field.
Global will own 100% of the Luna Llena Contract subject only
to an initial 8% royalty, with the size of the royalty to
be determined by future production levels. The Contract duration
is 30 years divided into an initial six-year exploration phase
and a 24 year exploitation and production phase. Under the
terms of the Luna Llena Contract, Global must, within 18 months,
acquire 165 kilometers of 2D seismic, reprocess 500 kilometers
of existing seismic, re-enter and test one existing well and
drill two exploratory wells which cover the total geologic
column. Global can then elect, if it so wishes, to proceed
to phase two which also covers 18 months and requires re-entering
another existing well or drilling another exploratory well.
Phases three to five, all optional, are each 12 months and
require the drilling of an exploratory well in each phase.
Global will continue to hold the remaining Valle Lunar TEA
acreage and conduct further geologic analysis and geophysical
tests over the next several months, fulfilling all the associated
work obligations, with a goal of potentially contracting more
of the acreage. Global is finalizing its plans for new drilling
in the El Miedo field in the second half of 2006.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries and shareholdings.
Additional information may be found at the Harken Energy Web
site, www.harkenenergy.com, or by calling Bevo Beaven or Bill
Conboy at CTA Public Relations at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended September 30, 2005.
Harken undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
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Harken Energy Reports Third Quarter
2005 Net Income of $32.8 Million
Third Quarter Revenues Increase 39%, Operating Margin Increases 21%
Dallas - Texas - November 9, 2005 - HKN, Inc. (AMEX: HEC) is pleased to report Net Income of $32.8 million, or $0.15 per share, for its third quarter ended September 30, 2005. Total revenues in the third quarter of 2005 increased to $11.6 million, an increase of 39% over the third quarter of 2004, due to a continued increase in international production and higher oil and gas prices. Non-GAAP Operating Margin increased to $5.5 million in the third quarter of 2005, representing 21% growth over the same period in the prior year.
Global Stock Sales, Global Warrant Liability Extinguished, Conversion of Convertible Notes
During the three months ended September 30, 2005, Harken sold a portion of its equity interest in Global Energy Development PLC (Global). With the sales of these shares (along with the exercise of Global warrants and share options), Harken's equity interest in Global was approximately 34% at September 30, 2005. Harken recognized gains totaling $11.9 million equal to the amount by which the total sale proceeds exceeded the net book value of its Global shares sold. Harken does not anticipate recognizing similar gains in the future.
The global warrant liability on Harken's balance sheet was extinguished with the exercise of all outstanding Global Minority Owner warrants and the exercise of the Global Warrants held by Lyford Investments Enterprises. Harken recognized a gain of $28 million representing the difference between the cash proceeds received plus the fair value of the Global Warrant liability extinguished and the net book value of Harken's shares in Global sold as of the date of exercise. Harken does not anticipate recognizing similar gains in the future.
Share-based liability related to Global's stock option plan increased due primarily to the increase in Global's common share price along with the continued vesting of Global's outstanding options. During the third quarter of 2005, Global recorded share-based compensation expense of approximately $6.9 million associated with the increased common share price and vesting.
Holders of $3.325 million of 5% Convertible Notes voluntarily converted the debt into approximately 6.5 million shares of Harken common stock, during the three months ended September 30, 2005. The conversion had no effect on profit and loss.
Redemption of Preferred Shares
Harken redeemed all of the outstanding 50,000 shares of Series J Preferred in exchange for $5.0 million in cash, and recorded a non-cash accounting loss to preferred holders of approximately $225,000 related to this transaction.
The Company redeemed 11,825 shares of Series G1 Preferred in exchange for $65,000 in cash. Only 1,600 shares of Series G1 Preferred remain outstanding. Harken recorded a non-cash accounting gain from preferred holders of approximately $489,000.
Harken redeemed 1,000 shares of Series G2 Preferred in exchange for $24,000 in cash. Only 1,000 shares of Series G2 Preferred remain outstanding. A small non-cash accounting gain from preferred holders of approximately $53,000 was recorded.
The Company redeemed 67,715 shares of Series G4 Preferred in exchange for $3.7 million in cash. The Series G4 Preferred is no longer outstanding. Harken recorded a non-cash accounting loss from preferred holders of approximately $204,000.
Operating Summary
Gulf Energy Management Company (GEM)
During the quarter ended September 30, 2005, GEM's Louisiana operations were affected by one tropical storm and two hurricanes that interrupted both production and certain drilling operations. As much as 75% of GEM's domestic production was shut in during September and approximately 40% of its pre-storm production level remains curtailed. GEM continues to inspect and repair damage to its eastern Gulf operations that remain shut-in which include Main Pass, Point a la Hache and non-operated properties at Branville Bay, Backridge, Port Arthur (TX) and Abbeyville. Restoration of remaining curtailed production is also dependent on resumption of downstream infrastructure and the availability of service and equipment contractors necessary for over-water transportation and repairs. As of September 30, 2005, GEM properties were producing at approximately 4.4 million cubic feet equivalent per day.
During the quarter ended September 30, 2005, GEM's oil and gas revenues decreased 11% to approximately $4.1 million compared to $4.7 million for the prior year period primarily due to the decrease in sales and production volumes in the third quarter of 2005 as compared to the prior year period. The company reported accelerated declines in certain field productivity in the Raymondville field as well as lost production due to hurricane Katrina and Rita. The decrease in sales volume was partially mitigated by an increase in average oil and gas commodity prices received, as compared to the prior year third quarter.
GEM's oil and gas operating expense increased 25% to approximately $1.5 million during the third quarter of 2005 compared to approximately $1.2 million during the third quarter 2004 primarily due to property insurance deductibles and other related items for the repair and restoration of damages from Hurricanes Katrina and Rita.
Regarding GEM's Indiana Posey Coalbed Methane Prospect, in September 2005, after the submission of a Phase I core evaluation report, GEM has elected to proceed and fund pilot well drilling under Phase II of the agreement. On GEM's Ohio Cumberland Coalbed Methane Prospect, the coring phase is continuing and expected to be completed in the fourth quarter of 2005. In addition, GEM is actively evaluating other strategic coalbed methane opportunities in pursuit of long-lived reserve prospects to compliment our current oil and gas portfolio.
Global Energy Development PLC (Global)
During the third quarter 2005 as compared to the third quarter 2004, Global reported increased oil revenues, operating expenses and oil volumes. Global's oil revenues increased to approximately $6.6 million during third quarter 2005 as compared to $3.5 million in the third quarter 2004. Oil sales volumes increased 34% to approximately 134,000 net barrels (after royalties and Cajaro's working interest allocation) during the three months ended September 30, 2005 from approximately 100,000 net barrels during the third quarter of 2004. Increased oil sales volumes were a result of improved well performance and successful workovers. Global's average oil commodity prices increased 39% to $49.33 during the third quarter 2005 compared to $35.48 during the third quarter 2004.
Global's operating expenses have increased 135% from approximately $671,000 for third quarter 2004 to approximately $1.6 million for third quarter 2005, primarily due to equipment rentals and diesel fuel costs and workovers due to increased production volumes from certain wells in the second quarter of 2005. These wells include the Tilodiran, the Macarenas, and the Estero #4 and Estero #5 wells. Diesel fuel costs have risen with the increase in price of crude oil.
International Business Associates (IBA)
IBA incurred net trading gains of approximately $536,000 for the quarter ended September 30, 2005. IBA's net loss for the same period was approximately $116,000. During the period ended September 30, 2005, IBA has had a low volume of trading activities and has been unsuccessful in obtaining trading contract overseas. Harken is currently pursuing strategic alternatives regarding its investment in IBA.
Balance Sheet Summary
As the ratios below show, Harken has improved its Working Capital by over 100% since year-end 2004 to approximately $45.9 million at September 30, 2005. Harken reduced its debt by 77.6% during the nine months ended September 30, 2005, ending the period with over $46.8 million in cash less debt as detailed below:
(1) Current ratio is calculated as current assets divided by current liabilities
(2) Working capital is the difference between current assets and current liabilities
* Derived from audited financial statements
NON-GAAP FINANCIAL MEASURE
Reconciliation of Operating Margin to Net Income (loss)
Management believes the presentation of this non-GAAP financial measure, in connection with the results for the three and nine months ended September 30, 2005 and 2004, provides useful information to investors regarding the Company's results of operations. Management also believes that this non-GAAP financial measure provides a picture of Harken's results that is comparable among reporting periods and provides factors that influenced performance during the period under the report. This non-GAAP financial measure should be considered in addition to, and not as a substitute for, financial measures prepared in accordance with GAAP.
HKN, Inc. is engaged in oil and gas exploration, development and production operations both domestically and internationally through its various subsidiaries. Additional information may be found at the Harken Energy Web site, www.harkenenergy.com, or by calling Bevo Beaven or Bill Conboy at CTA Public Relations at (303) 665-4200.
Certain statements in this announcement including statements regarding future expectations, objectives, intentions and plans for oil and gas exploration, development and production may be regarded as "forward-looking statements" within the meaning of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made. Management's current view and plans, however, are subject to numerous known and unknown risks, uncertainties and other factors that may cause the actual results, performance, timing or achievements of Harken to be materially different from any results, performance, timing or achievements expressed or implied by such forward-looking statements. The various uncertainties, variables, and other risks include those discussed in detail in the Company's SEC filings, including the Annual Report on Form 10-K/A, as amended, for the year ended December 31, 2004 and its Quarterly Report on Form 10-Q for the period ended June 30, 2005. Harken undertakes no duty to update or revise any forward-looking statements. Actual results may vary materially.
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Global Energy Development
PLC Raises $12.5 Million through Issuance of Convertible Notes
Notes to provide funding
for rig contracting and acreage acquisition
Dallas, Texas
- November 1, 2005 -
HKN, Inc. (AMEX: HEC), announced today that Global
Energy Development PLC, (‘Global') has raised
$12.5 million through the issue of unsecured variable coupon
convertible notes due October 30, 2012 ("Notes")
to a Swiss-based fund manager. Harken Energy currently holds
11,892,922 ordinary shares, representing approximately 34%
of Global's issued share capital.
The Notes have an annual coupon of 5% for the first three
years, 6% from October 2008 to October 2010, and 7% thereafter,
payable quarterly in arrears. The Notes are convertible into
ordinary shares of Global at 305.8 pence per ordinary share,
representing a 10% premium to the closing market price on
October 28, 2005, the last trading day before delivery of
the Notes.
"Global has increased its acreage position and prospects
over the past year and we expect to further supplement our
current 5.1 million acres over the coming months," said
Stephen Voss, Global's Managing Director. "We
expect to accelerate the drilling programs associated with
a number exploratory projects in our portfolio. This financing
also provides Global with additional funds to dedicate towards
rig contracting allowing greater visibility over drilling
schedules and for general corporate purposes as we move forward."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries and shareholdings.
Additional information may be found at the Harken Energy Web
site, www.harkenenergy.com, or by calling Bevo Beaven or Bill
Conboy at CTA Public Relations at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended June 30, 2005. Harken
undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
The information contained in this announcement is not an offer
of securities for sale or a solicitation of an offer to purchase
securities in the United States. The securities have not been,
nor will they be, registered under the United States Securities
Act of 1933, as amended (the "Securities Act"),
or with any securities regulatory authority of any state or
other jurisdiction of the United States and may not be offered,
sold or delivered within the United States or to US persons
(as defined in Regulation S) except pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act and applicable state securities
laws.
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Global Energy Development
PLC - Los Hatos #1 Positive Test Results
New
well provides extension to established Palo Blanco field
Dallas,
Texas - October 27, 2005 - HKN, Inc.
(AMEX: HEC), announced today that Global Energy Development
PLC, (‘Global') has had positive test results
from its Los Hatos #1 well and expects to place it on continuous
production within seven days. The Los Hatos #1 well is located
within Global's exclusive 85,000-acre Los Hatos Exploration
and Production Concession Contract in Colombia. Harken Energy
currently holds 11,892,922 ordinary shares, representing approximately
34% of Global's issued share capital.
The Los Hatos #1 well perforated and tested the Mirador formation
at a maximum rate of 700 metric cubic feet of natural gas
per day and 408 barrels of oil per day of 36 degree API gravity
oil with BS&W (basic sediment and water) of only 3%. Global
owns 100% working interest in the Los Hatos Contract, subject
only to an initial 8% royalty, with the size of the royalty
to be determined by future production levels. The placing
of Los Hatos #1 on production will mean Global has production
from five different contracts in Colombia in addition to holding
high-potential exploration acreage positions in Colombia,
Peru and Panama.
"The success of the Los Hatos #1 well has effectively
extended the established, producing Palo Blanco field further
to the south," said Stephen Voss, Global's Managing
Director. "Finding and producing oil in the Mirador
formation is especially encouraging as this formation is producing
commercial hydrocarbons from Estero #2, the most northerly
well within the Palo Blanco field, and now Los Hatos #1, the
southerly extension of the Palo Blanco field. We will promptly
undertake additional geologic and engineering analysis to
assess the potential additional Mirador reserves throughout
both the Los Hatos and Alcaravan contracts. "
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries and shareholdings.
Additional information may be found at the Harken Energy Web
site, www.harkenenergy.com, or by calling Bevo Beaven or Bill
Conboy at CTA Public Relations at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended June 30, 2005. Harken
undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
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HKN, Inc. Announces 10 Million Share Stock Repurchase Plan
Dallas, TX
- September 22, 2005 - HKN, Inc. (AMEX:
HEC) announced that its Board of Directors has authorized
a new stock repurchase program allowing the Company to buy
back up to 10 million shares of its common stock. All repurchases
will be made from time to time in the open market when opportunities
to do so at favorable prices present themselves in compliance
with all applicable laws and regulations, including the Securities
and Exchange Commission rules.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended June 30, 2005. Harken
undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
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Harken Energy Gives Notice
Of Conversion Of Convertible Notes
Dallas, TX -
September 21, 2005 - HKN, Inc. (AMEX:
HEC) today announced that it has given notice of its determination
to exercise its rights to convert its 5% Senior Convertible
Notes, due June 30, 2009 (the "5% Notes") for
shares of Harken common stock. Pursuant to the terms of the
5% Notes, Harken has designated November 4, 2005 as the mandatory
conversion date.
On November 4, 2005, the conversion date, each 5% Note that
is outstanding as of that date will be converted to shares
of Harken Energy common stock equal to the principal amount
of the 5% Notes to be converted, plus accrued and unpaid interest
thereon through the mandatory conversion date, divided by
the appropriate conversion price set by the 5% Notes. Currently,
there is approximately $3.8 million principal amount of 5%
Notes outstanding, which would result in an issuance of up
to approximately 7.5 million shares of common stock upon mandatory
conversion.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement regarding future
expectations, objectives, intentions and plans for future
actions, oil and gas exploration, development and production
may be regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on the opinions
and estimates of management at the time the statements are
made. Management's current view and plans, however,
are subject to numerous known and unknown risks, uncertainties
and other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements. The various
uncertainties, variables, and other risks include those discussed
in detail in the Company's SEC filings, including the
Annual Report on Form 10-K/A, as amended, for the year ended
December 31, 2004 and its Quarterly Report on Form 10-Q for
the period ended June 30, 2005. Harken undertakes no duty
to update or revise any forward-looking statements. Actual
results may vary materially.
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Harken Energy Raises $6.3 Million from Lyford
Warrant Exercise
DALLAS,
TX - September 16, 2005 -HKN, Inc.
(AMEX: HEC) announced today that Lyford Investment Enterprises,
Ltd ("Lyford") exercised warrants to purchase
7,000,000 Global Energy Development, PLC ("Global")
ordinary shares held by Harken. The transaction raised approximately
$6.3 million in new capital for Harken Energy.
As a result of the exercise of warrants, Harken now holds
11,975,641 ordinary shares, representing 34.09% of the Global's
issued share capital, and Lyford holds 7,000,000 ordinary
shares, representing 19.93% of the Global's issued share
capital. There are no further warrants outstanding with respect
to Global's ordinary shares.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended June 30, 2005. Harken
undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
###
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Harken
Energy Raises $14.1 Million Through Sale of Global Energy
Shares
DALLAS,
TX - September 12, 2005 - HKN, Inc.
(AMEX: HEC) negotiated and closed the sale of 2,829,501 shares
from its existing holdings in Global Energy Development PLC,
raising approximately $14.1 million in new capital for Harken
Energy.
Regarding the Global Energy Development shares sold, 1,749,501
were conducted through a private sale at market prices to
FMR Corporation and Fidelity International Ltd. and/or one
or more of their respective direct and indirect subsidiaries.
The remaining balance of 1,080,000 shares were sold in open
market transactions at market prices. As a result of these
transactions, Harken Energy now holds 18,975,641 ordinary
shares, representing approximately 54% of Global Energy Development's
outstanding common shares.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q for the period ended June 30, 2005. Harken
undertakes no duty to update or revise any forward-looking
statements. Actual results may vary materially.
###
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Harken
Energy Provides Assessment of Impact from Hurricane Katrina
DALLAS,
TX - September 8, 2005-
HKN, Inc.'s
(AMEX: HEC) wholly owned subsidiary, Gulf Energy Management
Company ("GEM"), today reported the initial
assessment of Hurricane Katrina's impact on its domestic
oil and gas operations which are primarily located onshore
and offshore in the Gulf of Mexico.
In
preparation for the storm,
75% of GEM's domestic production was shut in
and all employees were safely evacuated.
GEM has begun start-up operations and as of today is
producing at approximately 55% of its pre-Katrina production
level.
GEM
continues to inspect and repair damage to its eastern Gulf
operations that remain shut in which include, Main Pass, Point
a la Hache, Branville Bay and Lapeyrouse. Restoration
of remaining curtailed production is also dependent on resumption
of downstream infrastructure and the availability of service
and equipment contractors necessary for over-water transportation
and repairs.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements such as
"believes", "anticipates", "expects"
and all similar statements regarding future expectations, objectives,
intentions and plans for oil and gas exploration, development
and production may be regarded as
"forward-looking statements" within the meaning
of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions
and estimates of management at the time the statements are made.
Management's current view and plans, however, are
subject to numerous known and unknown risks, uncertainties and
other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements.
The various uncertainties, variables, and other risks
include those discussed in detail in the Company's SEC
filings, including the Annual Report on Form 10-K/A, as amended,
for the year ended December 31, 2004 and its Quarterly Report
on Form 10-Q for the period ended June 30, 2005.
Harken undertakes no duty to update or revise any forward-looking
statements. Actual
results may vary materially.
###
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Harken
Energy Completes Two Million Share Buyback of Common Stock
DALLAS,
TX—September
6, 2005—HKN, Inc. (AMEX:
HEC) announced
it has completed the buyback of two million shares of its
common stock. These shares were repurchased as part of the
stock repurchase plan previously announced in June of 2005.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven and Bill Conboy at
CTA Public Relations at (303) 665-4200.
Certain
statements in this announcement including statements such
as "believes", "anticipates", "expects"
and all similar statements regarding future expectations,
objectives, intentions and plans for oil and gas exploration,
development and production may be regarded as
"forward-looking statements" within the
meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions
and estimates of management at the time the statements are
made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The
various uncertainties, variables, and other risks include
those discussed in detail in the Company's SEC filings,
including the Annual Report on Form 10-K/A, as amended, for
the year ended December 31, 2004 and its Quarterly Report
on Form 10-Q for the period ended June 30, 2005.
Harken undertakes no duty to update or revise any forward-looking
statements. Actual
results may vary materially
###
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Global
Energy Mobilizes Rig to First Exploratory Well on Los Hatos
Contract in Colombia
Dallas,
Texas - August 17, 2005 - HKN, Inc.
(AMEX: HEC), announced today that Global Energy Development
PLC, (‘Global') commenced rig mobilization to
spud the first exploratory well, the Los Hatos #1, within
its exclusive 85,000 acre Los Hatos Exploration and Production
Concession Contract (the ‘Contract') in Colombia.
Harken currently holds approximately 62% of Global's
common shares.
The Contract, part of an approximate 5.1 million acre portfolio
currently held by Global in Colombia, Peru and Panama, is
located in the central Llanos region and is contiguous southwards
to Global's Alcaravan Association Contract which contains
the established, producing Palo Blanco Field.
The Los Hatos #1 exploratory well is up dip and approximately
300 meters from the Cajaro #1 well within the Palo Blanco
Field. The Cajaro #1 well has had cumulative production of
approximately 328,000 gross barrels of oil since it was placed
on to production in June 2003.
"Global expects to spud Los Hatos #1 by late August
2005 with the well equipped for production by early October
2005," said Stephen C. Voss, Global's Managing
Director. "Should the Los Hatos #1 well be successful,
it will increase the number of Contracts from which we are
currently producing to five."
Following the operations on Los Hatos # 1, Global expects
the rig to be mobilized sometime during the fourth quarter
to another exploratory well, Tilodiran #2, within the producing
Rio Verde Exploration and Production Concession contract.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q, as amended, for the period ended June
30, 2005. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary materially.
###
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Harken
Energy Provides Domestic Operations Update
Dallas,
Texas - August 16, 2005 - HKN, Inc.'s
(AMEX: HEC) wholly owned subsidiary, Gulf Energy Management
Company ("GEM"), released updated production figures
and well completion status for its domestic oil and gas operations,
which are located primarily along the onshore and offshore
Texas and Louisiana Gulf Coast. In addition during March 2005,
GEM acquired two new Coalbed Methane Prospects (CBM) located
in Indiana and Ohio, each covering approximately 400,000 acres.
As of June 30, 2005, GEM's net domestic production rate
was at approximately 7.3 million cubic feet equivalent of
natural gas per day. In addition, new production initiated
subsequent to June 30, 2005, related to two wells completed
during the second quarter has increased this rate to approximately
7.6 million cubic feet equivalent of natural gas per day as
of August 15, 2005. The following field data updates the status
of GEM's domestic operations through the end of June
2005.
Lapeyrouse Field, Terrebonne Parish - Louisiana
GEM continues to participate in an active field redevelopment
program that has included an interest in seven successful
wells in the Lapeyrouse field since the fourth quarter of
2003. GEM holds an average non-operated working interest of
8.2% in seven wells in this field. Although two workovers
attempted to remedy certain mechanical problems in the second
quarter 2005 were unsuccessful, two additional workovers and
one well deepening are scheduled in the field for the third
quarter 2005. An eighth well was completed and began producing
in May 2005. A ninth well was spudded in June 2005 with a
target depth of about 15,000 feet true vertical depth. Currently,
the well is still drilling with intermediate casing set to
approximately 14,100 feet and has already logged one productive
sand behind pipe. GEM holds an approximately 39% operated
working interest in this ninth well.
Main Pass, Plaquemines Parish - Louisiana
During the second quarter of 2005, GEM commenced
a major overhaul and rebuild of an additional compressor for
the Main Pass Field that has been off-line for the past four
years. This investment in the unit was an effort to increase
gas lift in the field and should permit GEM to return certain
wells to production. Currently, the unit is still undergoing
a testing period, however, the added capacity had already
increased field production in July 2005 by approximately 100
bopd with an expectation of more production from the additional
shut-in wells. GEM holds an average 90% working interest in
the Main Pass Field. GEM continues its geological and geophysical
study in the area, utilizing the recently acquired license
to 21 square miles of 3D seismic data, covering the area held
by production leases.
Raymondville Field, Willacy and Kenedy Counties -
Texas
In 2005, GEM participated in an active recompletion
campaign in this field with little success. GEM believes that
field production has peaked and will continue to decline.
GEM has an average 27% non-operated working interest in this
field.
Lake Raccourci Field, Lafourche Parish - Louisiana
GEM holds a 40% operated working interest in each
of its Lake Raccourci wells. GEM is presently seeking industry
partners to drill a field extension well. This prospect is
a result of continuing interpretation of GEM's 60 square
mile reprocessed 3D seismic database.
New 3D Seismic Licenses Acquired - Louisiana
GEM continues to evaluate seismic licenses acquired
in the fourth quarter of 2004 covering approximately 155 square
miles of 3D seismic data in three different surveys across
south Louisiana. The largest database is in Terrebonne Parish
and includes approximately 70 square miles. Approximately
56 square miles is in Cameron Parish, and approximately 29
square miles in Iberville Parish. A number of leads have developed
in this continuing study. GEM is in the process of cataloging
and prioritizing the seismic data.
South Beach Field, Chambers County - Texas
GEM has a non-operated working interest of 10% in
this area. The initial well was drilled to a true vertical
depth of 10,750 feet and completed in the fourth quarter of
2004. GEM also participated in a second well drilled during
the first quarter of 2005. Production facilities and a pipeline
were essentially completed in the second quarter of 2005,
but as of August 9, 2005, production on the well had not commenced
pending tie-in with the transmission company now expected
in the third quarter of 2005.
Branville Bay Field, Plaquemines Parish - Louisiana
GEM has a non-operated working interest of 12.5%
in this area. The initial well was drilled to a total depth
of 7,400 feet in the fourth quarter of 2004. The well was
completed in the two logged productive sands, and production
began in February 2005. A second well which was completed
to a total depth of 8,000 feet is currently awaiting pipeline
connection expected in the third quarter of 2005.
Point-a-la-Hache Field, Plaquemines Parish -
Louisiana
The initial well, State Lease 18077 #1, was drilled
to a true vertical depth of 10,300 feet in mid- December 2004.
The well was logged productive, completed and tested in the
lower sand of two sands that both logged productive. The well
began producing in July 2005. GEM maintains a 25% operated
working interest in the area.
Allen Ranch Field, Colorado County - Texas
The initial well, the Hancock Gas Unit #1, was drilled
to a measured depth of 16,983 feet in late January 2005. The
well was productive in four sands and first production began
in April 2005. GEM owns an 11.25% non-operated working interest
in the area.
Southeast Nada Field, Colorado County - Texas
GEM has a 17% non-operated working interest in this
area. The initial well, the Popp et al #1, was drilled to
a measured depth of 10,030 feet in late March 2005. The well
was logged productive in two sands and began producing in
May 2005.
Coalbed Methane Prospects - Indiana and Ohio
In March 2005, GEM entered into two significant Coalbed
Methane Exploration and Development Agreements, one related
to prospects in Indiana and the other related to prospects
in Ohio. Each prospect provides for an area of mutual interest
of approximately 400,000 acres. The agreements provide for
a phased delineation, pilot and development program, with
corresponding staged expenditures. Both agreements call for
GEM to fund 100% of the initial $7.5 million in costs to carry
out the joint exploration and development of the project in
return for a non-operating 65% interest in respective prospect
area, and an 82.5% net revenue interest. Ute Energy, a contracted
third party with a long track record in successful Coalbed
Methane development is the operator and provides expert advice
for these projects.
On the Indiana Prospect, GEM elected to drill an additional
core hole and expand the scope of the work, and as such has
funded $446,000 for Phase I. The last core hole was finished
at the beginning of July 2005. Gathered data is being processed
and analyzed. Following a report and evaluation of the cores,
an election by GEM with regard to Phase II for pilot well
drilling will most likely take place late in the third quarter
of 2005.
On the Ohio Prospect, funding of the work for Phase I of $284,200
is expected to occur in the third quarter of 2005. GEM expects
to move a rig to the applicable location during August 2005,
and for core drilling and data gathering to be completed by
early fourth quarter of 2005.
Management Comment
"For 2005, GEM allocated $16 million in domestic
capital expenditures to increase its oil and gas reserves
and grow production. As highlighted in today's update
we expect new production to come online in the Lapeyrouse,
Main Pass, South Beach, Branville Bay, and Point-a-la-Hache
fields. We are very encouraged by this progress along with
the initial test results on our Indiana CBM prospect,"
said Jim Denny, President of Gulf Energy Management Company.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
such as "believes", "anticipates",
"expects" and all similar statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A, as
amended, for the year ended December 31, 2004 and its Quarterly
Report on Form 10-Q, as amended, for the period ended June
30, 2005. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary materially.
###
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Harken
Energy Reports Net Income of $15.7 Million, 44% Increase in
Revenue and 54% Increase in Operating Margin for the Second
Quarter of 2005
Dallas,
Texas - August 9, 2005 - HKN, Inc.
(AMEX: HEC) reports quarterly financial results and is pleased
to announce Net Income of $15.7 Million for the period ended
June 30, 2005. As summarized below, total revenues in the
second quarter of 2005 increased to $11.6 million, an increase
of 44% over the second quarter of 2004, due to increased international
production and higher oil and gas prices. Non-GAAP Operating
Margin increased to $5.8 million in the second quarter of
2005, representing 54% growth over the same period in the
prior year, and a 135% improvement as compared to the first
quarter 2005.
During
the six months ended June 30, 2005 Harken sold certain of
its common shares of Global Energy Development PLC ("Global"),
at market prices as of the date of each sale, in exchange
for total cash consideration, net of fees, of approximately
$26 million. These sales of shares decreased Harken's
ownership percentage in Global. Harken owned approximately
62% of Global's common shares as of June 30, 2005. In
accordance with APB Opinion 18 (As Amended) "The Equity
Method of Accounting for Investments in Common Stock"
and as a result of the sale of these shares during the six
months ended June 30, 2005, Harken recognized a gain of approximately
$20 million equal to the amount by which the total proceeds
exceeded Harken's proportionate carrying value of Global.
Since December 31, 2004, Global's common share price,
as listed on the AIM Exchange in London, has increased from
153 UK pence to 223 UK pence as of June 30, 2005. Three institutional
investors have taken a position in Global's common shares
during this same period, and the estimated fair market value
of Harken's investment in Global increased from approximately
$50 million(1) at December 31, 2004 to approximately $60 million(2)
at June 30, 2005.
(1) Estimated fair market value of $50 million was calculated
as the number of Global common shares held by Harken (less
outstanding warrants held by Lyford Investments Enterprises,
Ltd. to purchase up to 7,000,000 shares of Global held by
Harken) multiplied by Global's share price and the exchange
rate at December 31, 2004 (23,949,930 shares less 7,000,000
warrants multiplied by 153 UK pence per share at 1.92 currency
exchange rate).
(2) Estimated fair market value of $60 million was calculated
as the number of Global common shares held by Harken (less
outstanding warrants held by Lyford Investments Enterprises,
Ltd. to purchase up to 7,000,000 shares of Global held by
Harken) multiplied by Global's share price and the exchange
rate at June 30, 2005 (21,805,142 shares less 7,000,000 warrants
multiplied by 223 UK pence per share at 1.79 currency exchange
rate).
Operating
Summary
Gulf Energy Management Company (GEM):
During the period ended June 30, 2005, GEM continued development
of its operations and properties in the Gulf Coast area of
Texas and Louisiana, specifically the Lapeyrouse, Branville
Bay, Point-a-la-Heche fields in Louisiana and the South Beach,
Allen Ranch and Southeast Nada filed in Texas. As of June
30, 2005, GEM's net domestic production rate was at
approximately 7.3 million cubic feet equivalent of natural
gas per day. In addition, new production initiated subsequent
to June 30, 2005 has increased this rate to approximately
7.6 million cubic feet equivalent of natural gas per day related
to two wells completed in the second quarter 2005.
Related to GEM's Coalbed Methane Exploration and Development
Project in Indiana, covering 400,000 acres, GEM elected to
expand the scope of the Phase I coring work, and funded $446,000
in connection with the drilling and evaluation of five core
samples for Phase I during the quarter ended June 30, 2005.
The last core hole was finished at the beginning of July 2005.
Gathered data is being processed and analyzed. Following a
report and evaluation of the cores, an election by GEM with
regard to Phase II for pilot well drilling will most likely
take place late in the third quarter of 2005.
On GEM's Ohio Coalbed Methane Exploration and Development
Project, covering an additional 400,000 acres, funding of
the work for Phase I of $284,000 is expected to occur in the
third quarter of 2005. GEM expects to move a rig during August
2005 and expects the core drilling and data gathering to be
completed by early fourth quarter of 2005.
During the six months ended June 30, 2005, GEM's oil
and gas revenues increased 9% to approximately $9.7 million
compared to approximately $8.9 million for the prior year
period due to the increase in both oil and gas prices as compared
to the prior year period. GEM's natural gas production
decreased 19% as compared to the prior year period, affected
principally by a 40% reduction in production associated with
GEM's interests in its existing wells in the Raymondville
and Lake Raccourci fields. Initial production from GEM's
new wells drilled during the first six months of 2005 helped
to offset these declines. GEM's oil production decreased
11% related to normal production declines from existing wells.
Global
Energy Development PLC:
Global revenues during the first six months of 2005 relate
to Global's oil operations in Colombia. Global's
Colombian oil revenues increased 65% from $5.5 million during
the first six months of 2004 to $9.1 million during the first
six months of 2005, due to increased oil prices, which averaged
$39.07 per barrel during the first six months of this year
compared to $27.62 per barrel during the first six months
of 2004 along with increased oil production. Global's
oil production volumes increased 17% during the first six
months of 2005 compared to the prior year period primarily
due to the new production from the Tilodiran #1, Macarenas
#1 and Estero #5 wells, mitigated by normal production decline.
Global's operating expenses increased 87% from $1.2
million during the first six months of 2004 to $2.2 million
for the first six months of 2005, primarily due to higher
diesel fuel and equipment rental costs.
In May 2005, Global signed a new exclusive Technical Evaluation
Agreement ("TEA") with the National Hydrocarbons
Agency of the Republic of Colombia for the evaluation of potential
hydrocarbons resources in the Valle Lunar area located in
the established Llanos Basin of eastern Colombia. The total
acreage covered by the TEA is approximately 2.1 million acres.
The Valle Lunar area has been subject to prior exploration
activity by an international petroleum company in 1981 with
two exploration wells reported as productive at that time.
The Valle Lunar TEA targets medium heavy oil deposits and
grants Global the exclusive option to sign a future Exploration
and Production Concession contract, typically 25 years in
duration, for acreage within the TEA area that Global identifies
as prospective and suitable for exploratory drilling and production
operations. The TEA duration is 16 months.
The TEA requires Global to complete within 12 months the reprocessing
and interpretation of 800 linear kilometers of existing 2D
seismic and certain other geophysical measurements and analysis,
including the acquisition of aeromagnetic data.
In May 2005, Global commenced work to acquire approximately
56 kilometers of new 2D seismic within its Rio Verde Exploration
and Production Contract in Colombia. The seismic is being
acquired around the two producing wells located on the Rio
Verde acreage, the Tilodiran #1 and Macarenas #1, in order
to evaluate and then proceed with the drilling of additional
wells within the contract area. In addition, a proportion
of the seismic is being acquired elsewhere in the contract
area to consider future exploratory wells. The new seismic
will be processed alongside with the reprocessing of 300 kilometers
of existing seismic as required under the terms of the contract.
International Business Associates (IBA):
IBA's net loss for the six months ended June 30, 2005
totaled approximately $2 million, which was primarily associated
with general and administrative expenses and foreign currency
losses. Harken invested in IBA, a start-up energy trading
company, in late 2004. IBA is in the initial stages of operations
and is focused primarily on opportunities created by the deregulation
of the energy market in Eastern Europe by seeking to trade
energy futures or other energy based contracts, principally
in Hungary and the United States. IBA began trading natural
gas contracts in the United States during late 2004 and has
continued with minimal trading activities during the first
six months of 2005.
Balance Sheet Summary
As the ratios below show, Harken has improved its Working
Capital by over 88% since year-end 2004 to approximately $41
million at June 30, 2005. Harken reduced its debt by 39% during
the six months ended June 30, 2005, ended the period with
over $30 million in cash less debt as detailed below:
Management
believes the presentation of this non-GAAP financial measure,
in connection with the results for the three and six months
ended June 30, 2005 and 2004, provides useful information
to investors regarding the Company's results of operations.
Management also believes that this non-GAAP financial measure
provides a picture of Harken's results that is comparable
among reporting periods and provides factors that influenced
performance during the period under the report. This non-GAAP
financial measure should be considered in addition to, and
not as a substitute for, financial measures prepared in accordance
with GAAP.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
regarding future expectations, objectives, intentions and
plans for oil and gas exploration, development and production
may be regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on the opinions
and estimates of management at the time the statements are
made. Management's current view and plans, however,
are subject to numerous known and unknown risks, uncertainties
and other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements. The various
uncertainties, variables, and other risks include those discussed
in detail in the Company's SEC filings, including the
Annual Report on Form 10-K/A, as amended, for the year ended
December 31, 2004 and its Quarterly Report on Form 10-Q, as
amended, for the period ended March 31,2005. Harken undertakes
no duty to update or revise any forward-looking statements.
Actual results may vary materially.
###
Back
to Top
Harken Energy Completes Two Million
Share Buyback of Common Stock and Authorizes an Additional
Two Million Share Repurchase Plan
Dallas,
TX - June 28, 2005 - HKN, Inc. (AMEX:
HEC) announced it has completed the buyback of two million
shares of its common stock. These shares were repurchased
as part of the stock repurchase plan previously announced
in May of 2005.
The
Board of Directors of Harken Energy has authorized another
stock repurchase program to buy back up to two million shares
of its common stock. All repurchases will be made from time
to time in the open market when opportunities to do so at
favorable prices present themselves in compliance with all
applicable laws and regulations, including the Securities
and Exchange Commission rules.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com
, or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
June 23, 2005 and quarterly report on Form 10-Q/A dated June
23, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary
materially.
###
Back
to Top
Harken Energy Raises Additional
$1.2 Million Through Sale of Global Energy Shares
Dallas,
TX - June 27, 2005 -
HKN, Inc. (AMEX: HEC) negotiated and closed
the sale of 345,374 shares from its existing holdings in subsidiary
Global Energy Development PLC, raising approximately $1.2
million in new capital for Harken Energy.
The
sale of Harken's Global Energy Development shares was
conducted through private sales at market prices. As
a result of this transaction Harken Energy now holds 21,905,142
shares or approximately 62.67% of Global Energy Development.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary
materially.
###
Back to Top
Harken Energy
Raises Additional $ 3.1 Million Through Sale of Global Energy
Shares
Dallas,
TX - June 23, 2005 - HKN, Inc.
(AMEX: HEC) negotiated and closed the sale of 1,000,000 shares
from its existing holdings in subsidiary Global Energy Development
PLC, raising approximately $3.1 million in new capital for
Harken Energy.
The
sale of Harken's Global Energy Development shares was
conducted through private sales at market prices. As
a result of this transaction Harken Energy now holds 22,250,516
shares or approximately 63.66% of Global Energy Development.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary
materially.
###
Back
to Top
Harken Energy Raises
$ 2.8 Million Through Sale of Global Energy Shares to Institutional
Investors
Dallas,
TX - June 20, 2005 - HKN, Inc.
(AMEX: HEC) negotiated and closed the sale of 900,000 shares
from its existing holdings in subsidiary Global Energy Development
PLC, raising approximately $2.8 million in new capital for
Harken Energy. The sale of Harken's Global Energy Development
shares included sales to certain institutional investors and
was conducted through private sales at market prices. As a
result of this transaction Harken Energy now holds 23,250,516
shares or approximately 66.52% of Global Energy Development.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
regarding future expectations, objectives, intentions and
plans for oil and gas exploration, development and production
may be regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on the opinions
and estimates of management at the time the statements are
made. Management's current view and plans, however,
are subject to numerous known and unknown risks, uncertainties
and other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements. The various
uncertainties, variables, and other risks include those discussed
in detail in the Company's SEC filings, including the
Annual Report on Form 10-K/A dated April 13, 2005 and quarterly
report on Form 10-Q dated May 10, 2005. Although Harken believes
that the expectations reflected in the forward-looking statements
of this announcement are reasonable, it can give no assurance
that such expectations will prove to be correct or that unforeseen
developments will not occur. Harken undertakes no duty to
update or revise any forward-looking statements. Actual results
may vary materially.
###
Back
to Top
Harken
Energy Raises $4.9 Million Through Sale of Global Energy Shares
to an Institutional Investor
Dallas,
TX - June 10, 2005 - HKN, Inc. (AMEX: HEC) ("Harken") negotiated
and closed the sale of 1,609,578 shares from its existing holdings
in subsidiary Global Energy Development PLC to an institutional
investor through a private sale at market prices, raising approximately
$4.9 million in new capital for Harken. As a result of
this transaction, and as of June 10, 2005, Harken now holds
24,150,516 shares or 69.09% of the total issued ordinary shares
of Global Energy Development PLC.
HKN, Inc. is engaged in oil and gas exploration, development
and production operations both domestically and internationally
through its various subsidiaries. Additional information may
be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for oil
and gas exploration, development and production may be regarded
as "forward-looking statements" within the
meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made.
Management's current view and plans, however, are subject
to numerous known and unknown risks, uncertainties and other
factors that may cause the actual results, performance, timing
or achievements of Harken to be materially different from any
results, performance, timing or achievements expressed or implied
by such forward-looking statements. The various uncertainties,
variables, and other risks include those discussed in detail
in the Company's SEC filings, including the Annual Report
on Form 10-K/A dated April 13, 2005 and quarterly report on
Form 10-Q dated May 10, 2005. Although Harken believes
that the expectations reflected in the forward-looking statements
of this announcement are reasonable, it can give no assurance
that such expectations will prove to be correct or that unforeseen
developments will not occur. Harken undertakes no duty to update
or revise any forward-looking statements. Actual results
may vary materially.
###
Back to Top
Harken Energy Exercises
Global Energy Development Warrants
Dallas,
TX - June 3, 2005 - HKN, Inc. (AMEX:
HEC) ("Harken") today announced that Harken has
exercised all of its outstanding warrants to purchase 6,487,481
ordinary shares in its subsidiary, Global Energy Development
PLC ("Global"). These warrants had an expiration
date of August 8, 2005 with an exercise price of 60 UK pence
per share for a total cash consideration of approximately
USD$7.1 million. As a result of the exercise of these
warrants, Harken ownership in Global has increased to approximately
74% of the total issued share capital of Global.
As
of June 3, 2005, certain of Global's minority shareholders
continue to hold outstanding warrants for 177,001 Global ordinary
shares at an exercise price of 60 UK pence per share that
expire on August 8, 2005. Additionally, Lyford Investments
Enterprises, Ltd. ("Lyford") continues to hold
warrants to purchase 7,000,000 ordinary shares of Global which
are currently held by Harken; these warrants have an exercise
price of 50 UK pence per share and expire on October 7, 2005.
Harken's ownership in Global could decrease to approximately
54% if or when all of these remaining warrants are exercised
prior to their expiration.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary
materially.
###
Back to Top
Harken Energy Subsidiary
Signs New Technical Evaluation Agreement for 2.1 Million Acre
Valle Lunar area in Colombia
Dallas, TX - May 31,
2005 - HKN, Inc. (AMEX: HEC) announced that
its 70% owned subsidiary Global Energy Development PLC ("Global"
or the "Company"), signed a new exclusive Technical
Evaluation Agreement ("TEA") with the National
Hydrocarbons Agency of the Republic of Colombia for the evaluation
of potential hydrocarbons resources in the Valle Lunar area
located in the established Llanos Basin of eastern Colombia.
The total acreage covered by the TEA is approximately 2.1
million acres.
The Valle Lunar TEA increases
Global's acreage position by approximately 70% to a
total of 5.1 million acres. Global now holds 5 Contracts and
a TEA agreement in Colombia, one Contract in Peru, and is
in the process of converting an existing TEA into an exclusive
Contract in Panama. Global holds 100% ownership interest in
all contracts.
The Valle Lunar area has been
subject to prior exploration activity by an international
petroleum company in 1981 with two exploration wells reported
as productive at that time. The Valle Lunar TEA targets
medium heavy oil deposits and grants Global the exclusive
option to sign a future Exploration and Production Concession
contract, typically 25 years in duration, for acreage within
the TEA area that Global identifies as prospective and suitable
for exploratory drilling and production operations. The TEA
duration is 16 months.
The TEA requires Global to
complete within 12 months the reprocessing and interpretation
of 800 linear kilometers of existing 2D seismic and certain
other geophysical measurements and analysis, including the
acquisition of aeromagnetic data. Aeromagnetic surveys
provide a fast, low-cost method of structurally mapping large
areas and the Company intends to identify subsurface geologic
features within the 2.1 million acres with geophysical characteristics
similar to other large, producing Llanos Basin fields.
Global intends funding the
work program and other costs required under the TEA, expected
to total approximately $544,000 with cashflow from production.
Global is currently producing from four of the Company's
six contracts.
"We are extremely excited
about our new Valle Lunar TEA located in the established Llanos
Basin region, said Stephen Voss, Managing Director of Global
Energy Development PLC. Industry experts have predicted there
is considerable further potential pointing to the known highly
effective petroleum system and its analogy with the heavy
oil belt of Venezuela. Global believes it is an area
of potentially significant medium heavy oil reserves which
is of a less expensive and technically straightforward class
to extract, as substantiated by data already available.
Medium heavy oil has become of paramount importance to the
oil industry as it and heavy oil are expected to increasingly
dominate the world's hydrocarbon reserves.
"We will seek to evaluate
potential reservoirs using the latest aeromagnetic techniques
and based upon the results of our geophysical efforts, the
Company anticipates signing a Concession contract and proceeding
with shallow borehole testing in late 2006.
"We anticipate the potential
deposits to be at shallow depths requiring relatively modest
costs and look forward to commencing our work program and
exploration efforts under this TEA against a backdrop of production
from several contracts we hold."
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in
this announcement including statements regarding future expectations,
objectives, intentions and plans for oil and gas exploration,
development and production may be regarded as "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary
materially.
###
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Harken Energy Commences Seismic Data
Study for Rio Verde Contract in Colombia
Cumulative Production on Rio Verde
Contract 48,000 Barrels to Date
Dallas, TX - May 23, 2005
- HKN, Inc. (AMEX: HEC) announced its 70%
owned subsidiary, Global Energy Development PLC (Global),
has commenced work to acquire approximately 56 kilometers
of new 2D seismic within its Rio Verde Exploration and Production
Contract in Colombia.
The seismic is
being acquired around the two producing wells located on the
Rio Verde acreage, the Tilodiran #1 and Macarenas #1, in order
to evaluate and then proceed with the drilling of additional
wells within the contract area. In addition, a proportion
of the seismic is being acquired elsewhere in the contract
area to consider future exploratory wells. The new seismic
will be processed alongside with the reprocessing of 300 kilometers
of existing seismic as required under the terms of the contract.
"The company is very pleased with the progress made
in the Rio Verde Contract," said Stephen Voss, Managing
Director of Global. "The Tilodiran #1 and Macarenas
#1 were rapidly brought on to production following the contract
signing in September last year and have had good ongoing performance."
Cumulative production to date from Tilodiran #1 and Macarenas
#1, which commenced in December 2004 and January 2005 respectively,
is approximately 48,000 barrels. "The new seismic
data will enable Global to select optimum locations for further
drilling in Rio Verde and we hope to be able to commence the
drilling of Tilodiran #2, before the end of 2005," said
Voss.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in this announcement including statements
regarding future expectations, objectives, intentions and
plans for oil and gas exploration, development and production
may be regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
Back to Top
HARKEN ENERGY CORPORATION
ANNOUNCES STOCK REPURCHASE PLAN
Dallas, TX - May 11, 2005
- HKN, Inc. (AMEX: HEC) today announced that
its Board of Directors has authorized a stock repurchase program
allowing the Company to buy back up to two million shares
of its common stock. All repurchases will be made from time
to time in the open market when opportunities to do so at
favorable prices present themselves in compliance with all
applicable laws and regulations, including the Securities
and Exchange Commission rules.
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in
this announcement including statements regarding future expectations,
objectives, intentions and plans for oil and gas exploration,
development and production may be regarded as "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005 and quarterly report on Form 10-Q dated May
10, 2005. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
Back to Top
Harken Energy Reports First Quarter
2005 Results
Dallas,
TX - May 10, 2005 - HKN, Inc.
(AMEX: HEC) today reported quarterly financial results for
the period ended March 31, 2005. Total revenues in the
first quarter of 2005 increased to approximately $7.4 million,
an increase of 14% over the first quarter of 2004, due primarily
to higher oil and gas prices. During the period ended March
31, 2005, Harken's balance sheet has remained strong
as summarized below. Harken ended the first quarter 2005 with
approximately $19.3 million in Cash, outstanding Debt of $8.6
million, and positive Working Capital of approximately $18
million.
Balance
Sheet Sumary:
| |
|
December
31, |
|
March
31, |
| |
|
2004
|
|
2005
|
| |
|
|
|
(unaudited)
|
| Current ratio
(1) |
|
2.54 to 1 |
|
2.77 to
1 |
| Working capital
(2) |
$
|
21,845,000
|
$
|
17,718,000
|
| Cash |
$
|
28,632,000
|
$
|
19,333,000
|
| Total debt
|
$
|
8,578,000 |
$
|
8,578,000
|
| Total cash
less debt |
$
|
20,054,000
|
$
|
10,7551,000
|
| Stockholders'
equity |
$
|
51,102,000
|
$
|
45,592,000
|
| Total debt
to equity |
|
0.17 to 1 |
|
0.19 to
1 |
|
(1) Current ratio is calculated as
current assets divided by current liabilities
(2) Working capital in the difference
between current assets and current liabilities
Capital
expenditures for the drilling and development of Harken's
energy-related assets totaled approximately $6 million during
the period ended March 31, 2005 of which Harken's 70%-owned
international subsidiary, Global Energy Development PLC (Global)
international capital expenditures totaled approximately $3.5
million, and Harken's wholly-owned domestic subsidiary,
Gulf Energy Management Company's (GEM) capital expenditures
totaled approximately $2.3 million.
Operating
Summary
The
most significant items in Harken's results of operations
for the period ended March 31, 2005 as compared to the prior
year period were the non-cash accounting losses associated
with Global's warrants and stock options.
During
the three months ended March 31, 2005, there was a 19% increase
in Global's common share price from approximately 153
UK pence at December 31, 2004 to approximately 181 UK pence
at March 31, 2005. As a result of the changes in Global's
common share price, Harken was required under US GAAP to record
an unrealized non-cash expense of approximately $3.8 million
for the period ended March 31, 2005 for the change in the
fair value of the Global Warrants held by outside parties.
These warrants expire in August and October 2005. As
of March 31, 2005, the fair value of the Global warrant liability
was estimated to be approximately $18.6 million. Harken
also holds warrants to purchase shares of Global's stock
at 60 UK pence per share. Since Global is a consolidated
subsidiary, the Global warrants held by Harken are not reflected
in Harken's financial statements. The estimated
fair value of Global warrants held by Harken at March 31,
2005 was approximately $15 million. The fair value of
the Global warrants was calculated by a third party firm based
primarily on the underlying market price of the Global common
stock.
In
addition to the Global warrants described above, certain employees
and directors of Global hold options to purchase shares of
Global's common stock. Accordingly, since the Global
share price is greater than the option exercise price, variable
plan accounting requires compensation expense to be recognized
for changes in Global's share price for all options
outstanding under the plan. Unrecognized compensation
costs relating to the unvested options are recorded over the
remaining vesting period. During the period ended March
31, 2005, Harken recognized share-based non-cash compensation
expense of approximately $2.0 million attributable to vested
Global stock as a result of the increase in the Global share
price during the period from December 31, 2004 to March 31,
2005.
A summary
of Harken's Results of Operations for the period ended
March 31, 2005 as compared to the prior year period is as
follows:
Capital expenditures for the
drilling and development of Harken's energy-related assets
totaled approximately $6 million during the period ended March
31, 2005 of which Harken's 70%-owned international subsidiary,
Global Energy Development PLC (Global) international capital
expenditures totaled approximately $3.5 million, and Harken's
wholly-owned domestic subsidiary, Gulf Energy Management Company's
(GEM) capital expenditures totaled approximately $2.3 million.
Operating Summary
The most significant items
in Harken's results of operations for the period ended
March 31, 2005 as compared to the prior year period were the
non-cash accounting losses associated with Global's
warrants and stock options.
During the three months ended
March 31, 2005, there was a 19% increase in Global's
common share price from approximately 153 UK pence at December
31, 2004 to approximately 181 UK pence at March 31, 2005.
As a result of the changes in Global's common share
price, Harken was required under US GAAP to record an unrealized
non-cash expense of approximately $3.8 million for the period
ended March 31, 2005 for the change in the fair value of the
Global Warrants held by outside parties. These warrants expire
in August and October 2005. As of March 31, 2005, the
fair value of the Global warrant liability was estimated to
be approximately $18.6 million. Harken also holds warrants
to purchase shares of Global's stock at 60 UK pence
per share. Since Global is a consolidated subsidiary,
the Global warrants held by Harken are not reflected in Harken's
financial statements. The estimated fair value of Global
warrants held by Harken at March 31, 2005 was approximately
$15 million. The fair value of the Global warrants was
calculated by a third party firm based primarily on the underlying
market price of the Global common stock.
In addition to the Global
warrants described above, certain employees and directors
of Global hold options to purchase shares of Global's
common stock. Accordingly, since the Global share price is
greater than the option exercise price, variable plan accounting
requires compensation expense to be recognized for changes
in Global's share price for all options outstanding
under the plan. Unrecognized compensation costs relating
to the unvested options are recorded over the remaining vesting
period. During the period ended March 31, 2005, Harken
recognized share-based non-cash compensation expense of approximately
$2.0 million attributable to vested Global stock as a result
of the increase in the Global share price during the period
from December 31, 2004 to March 31, 2005.
A summary of Harken's
Results of Operations for the period ended March 31, 2005
as compared to the prior year period is as follows:
| Three
Months Ended
March 31, |
| |
|
2004 |
|
2005 |
| |
|
|
|
|
| Total Revenues and
Other |
$ |
6,493,000 |
$ |
7,347,000 |
| Oil and Gas Operating
Expenses |
|
1,877,000 |
|
2,206,000 |
| General and Administrative
Expenses |
|
1,567,000 |
|
2,660,000 |
|
Operating Margin (Non-GAAP; see
Reconciliation
below) |
|
3,049,000 |
|
2,481,000 |
| Depreciation and Amortization
|
|
2,635,000 |
|
2,601,000 |
| Share-based Compensation
Expense |
|
- |
|
2,020,000 |
| Increase in Global
warrant liability |
|
50,000 |
|
3,796,000 |
| Accretion Expense |
|
102,000 |
|
92,000 |
| Interest Expense and
Other, net |
|
(124,000) |
|
269,000 |
| Gains from Extinguishment
of Debt |
|
(325,000) |
|
- |
| Gain on Investment
|
|
(990,000) |
|
- |
| Income Tax Expense
|
|
92,000 |
|
206,000 |
| Minority Interest in
Subsidiary |
|
98,000 |
|
(287,000) |
Net Income
/ (Loss) |
$ |
1,511,000 |
$ |
(6,216,000) |
| Accrual of Dividends
Related to Preferred Stock |
|
(766,000) |
|
(304,000) |
| Payment of Preferred
Stock Dividends |
|
2,664,000 |
|
(90,000) |
| Net Income / (Loss)
Attributed to Common Stock |
$ |
3,409,000 |
$ |
(6,610,000) |
| Basic Net Income
/ (Loss) per Common Share |
$ |
0.02 |
$ |
(0.03) |
| Basic Weighted Average
Shares Outstanding |
|
188,037,334 |
|
218,312,672 |
| Diluted Net Income
/ (Loss ) per Common Share |
$ |
0.02 |
$ |
(0.03) |
| Diluted Weighted Average
Share Outstanding |
|
203,377,334 |
|
218,312,672 |
Gulf Energy Management Company
(GEM)
During the quarter ended March
31, 2005, GEM continued development of its operations and
properties in the Gulf Coast area of Texas and Louisiana,
specifically the Lapeyrouse, Branville Bay, Point-a-la-Hache
fields in Louisiana and the South Beach, Allen Ranch and Southeast
Nada fields in Texas. Also during the first quarter
2005, GEM entered into two significant Exploration and Development
Agreements in Indiana and Ohio. The combined prospects provide
for an area of mutual interest of approximately 800,000 acres.
The agreements provide for a phased delineation, pilot and
development program, with corresponding staged expenditures.
A contracted third party with a long track record in successful
coalbed methane development will provide expert advice for
these projects. GEM is currently in Phase 1 of both Exploration
and Development Agreements which consist of drilling three
core holes on each prospect area.
During the period ended March
31, 2005, GEM's natural gas production decreased 3.7%
as compared to the prior year period, affected principally
by a 40% reduction in production associated with GEM's
interests in its existing wells in the Raymondville field.
Despite an active recompletion campaign at Raymondville, field
production peaked in 2004. Initial production from GEM's
new wells drilled during 2004 and first quarter 2005 helped
to offset the decline from Raymondville. Production
from GEM's newly drilled wells in the Point-a-la-Heche
field, the Allen Ranch field and the Southeast Nada fields
in Louisiana and Texas is expected to begin in the second
quarter of 2005.
Oil and gas operating expense
increased during the first quarter of 2005 compared to first
quarter 2004 primarily due to demand driven price increases
for oilfield services and equipment associated with increased
oilfield activity. Diesel fuel costs have risen with
the increase in price of crude oil.
Global Energy Development
PLC (Global)
Global continued the development
of its international operations by successfully re-completing
and commencing production from the Macarenas #1 well in January
2005 on its Rio Verde Exploration and Production Contract
area in Colombia, South America. Global owns a 100% working
interest in the Macarenas #1 well. Global currently
produces from two wells on the Rio Verde Contract and intends
to explore opportunities for additional development around
these two wells in the medium-term.
Global's oil sales volumes
decreased 20% from approximately 97,000 barrels in the first
quarter 2004 to approximately 78,000 barrels during the period
ended March 31, 2005. Lower oil sales volumes were a
result of the 2004 commerciality declaration from Ecopetrol
on Cajaro #1 resulting in a lower working interest to Global,
coupled with a 13,000 net barrel reduction in sales volumes
between the quarterly periods. In addition, the Torcaz
field volumes declined 3,000 net barrels, and the Olivo #1
well from the Bolivar Contract Area dropped by 5,000 net barrels
in the first quarter 2005 as compared to the prior year period.
Both areas are planned to be worked over during 2005.
New production from the Tilodiran #1 and the Macarenas #1
wells from the Rio Verde Contract area helped to partially
mitigate this decrease in sales volumes as compared to the
first quarter of 2004.
In March 2005, Global completed
the successful workover and the re-commencement of production
from the Canacabare #1 well located in the Anteojos field
within its Alcaravan Association Contract in Colombia.
Canacabare #1 was the first well to be brought on production
in the Anteojos field, which is adjacent to the established
Palo Blanco field, also within the Alcaravan Contract area.
During the workover, Global successfully added the Middle
Carbonera C-7 formation.
Global experienced increased
quality adjusted price penalties from the sale of its crude
oil during the first quarter 2005 as compared to the prior
year period. These penalties were as high as $4.00 per
barrel. To offset the increased quality adjustments,
in April 2005, Global entered into a new crude oil sales contract
with Petrobras Colombia Limited, a subsidiary of Petrobras,
the state oil company of Brazil, with an effective date of
May 1, 2005. The new non-exclusive contract offers Global
much improved terms through a reduced quality adjustment levy.
Global anticipates an approximate $3.00 increase in the net
well-head price it receives per barrel of oil. This
new contract covers all crude oil production from Global's
Palo Blanco, Anteojos, Rio Verde, Torcaz and Bolivar fields
in Colombia, net of royalties paid to the Colombian government
and Ecopetrol's portion of production from one well,
the Cajaro #1.
International Business Associates
(IBA)
IBA's net loss for the
period ended March 31, 2005 totaled approximately $1 million,
which was primarily associated with general and administrative
expenses. Harken invested in IBA, a start-up energy
trading company, in late 2004. IBA is in the initial
stages of operations and is focused primarily on opportunities
created by the recent deregulation of the energy market in
Eastern Europe by seeking to trade energy futures or other
energy based contracts, principally in Hungary and the United
States. IBA began trading natural gas contracts in the
United States during late 2004 and has continued with minimal
trading activities during the first quarter of 2005.
Chairman's Comment
Alan G. Quasha, Harken's
Chairman, stated, "The most significant items in our
income statement for the first quarter 2005 as compared to
the prior year period are the Global share-based compensation
expense and the increase in the Global warrant liability.
We are seeking to resolve these issues this year so they won't
continue to dominate our financial statements. The Global
warrants expire in August and October of 2005."
More information is available
in HKN, Inc.'s Form 10-Q for the period
ended March 31, 2005 which may be accessed through the Company's
website at www.harkenenergy.com.
NON-GAAP FINANCIAL MEASURE
Reconciliation of Operating
Margin to Net Income:
| Three
Months Ended
March 31, |
|
| |
|
2004
|
|
2005
|
| |
|
|
|
|
| Net Income / (Loss)
(GAAP) |
$ |
1,511,000 |
$ |
(6,216,000) |
| Minority
Interest in Subsidiary |
|
98,000 |
|
(287,000) |
| Income
Tax Expense |
|
92,000 |
|
206,000 |
| Gains
from Extinguishment of Debt |
|
(325,000) |
|
- |
| Gain on
Investment |
|
(990,000) |
|
- |
| Interest
Expense and Other, Net |
|
(124,000) |
|
269,000 |
| Accretion
Expense |
|
102,000 |
|
92,000 |
| Increase
in Global Warrant Liability |
|
50,000 |
|
3,796,000 |
| Share-Based
Compensation Expense |
|
- |
|
2,020,000 |
| Depreciation
and Amortization |
|
2,635,000 |
|
2,601,000 |
| Operating Margin |
$ |
3,049,000 |
$ |
2,481,000 |
Management believes the presentation
of this non-GAAP financial measure, in connection with the
results for the three months ended March 31, 2005, provides
useful information to investors regarding the Company's
results of operations. Management also believes that
this non-GAAP financial measure provides a picture of Harken's
results that is comparable among reporting periods and provides
factors that influenced performance during the period under
the report. This non-GAAP financial measure should be
considered in addition to, and not as a substitute for, financial
measures prepared in accordance with GAAP.
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in
this announcement including statements regarding future expectations,
objectives, intentions and plans for oil and gas exploration,
development and production may be regarded as "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005. Harken undertakes no duty to update
or revise any forward-looking statements. Actual results
may vary materially.
###
Back
to Top
Harken Energy Raises $3.8 Million
Through Sale of Global Energy Shares to an Institutional Investor
Dallas,
TX - April 29, 2005 - HKN, Inc.
(AMEX: HEC) negotiated and closed the sale of 1,264,600 shares
from its existing holdings in subsidiary Global Energy Development
PLC, raising $3.8 million in new capital for Harken Energy.
This sale of Harken's Global Energy Development shares
to an institutional investor was conducted through a private
sale at market prices. As a result of this transaction Harken
Energy now holds 19,772,613 shares or 70.24% of Global Energy
Development PLC.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on the opinions and estimates
of management at the time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and other
risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise any
forward-looking statements. Actual results may vary materially.
###
Back to Top
Harken Energy Announces New Crude
Oil Sales Contract Offering Improved Terms for Colombia Production
Dallas,
TX - April 21, 2005 - HKN, Inc.'s
(AMEX: HEC) 74.79% owned subsidiary, Global Energy Development
PLC, announced today that it has entered into a new crude
oil sales contract with Petrobras Colombia Limited, a subsidiary
of Petrobras, the state oil company of Brazil, with an effective
date of May 1, 2005.
The
new non-exclusive contract offers Global much improved terms
through a reduced quality adjustment levy with the company
anticipating an approximate $3.00 increase in the net well-head
price it receives per barrel. Quality adjustment levies can
fluctuate daily based upon market conditions and slight variances
in production blend.
The
contract is for an initial one year period with an automatic
renewal unless advance notice is received from either party
and covers all crude oil production from the Company's
Palo Blanco, Anteojos, Rio Verde, Torcaz and Bolivar fields
in Colombia, net of royalties paid to the Colombian government
and Ecopetrol's portion of production from one well,
the Cajaro #1.
"With
the recent addition of production from our new Rio Verde field
and continued success of the Mirador formation in the more
established Palo Blanco field the overall volume of Global's
lighter oil gravity has increased," said Stephen C.
Voss, Global's Managing Director. "As a result,
the company has been able to mix its heavier and light crudes
together into a widely accepted medium quality blend. This
blend will now be sold on an aggregated basis at a higher
overall price yield compared to our previous single well sales
contracts that resulted in deeper price discounts for our
heavier oils.
"The
ability of the company to improve its overall blend quality
and hence get preferential pricing has been facilitated by
the increased number of producing wells in Global's
portfolio over the past three years. We currently have
production from 11 wells compared to just two in early 2002,
both of which were of heavy oil quality. As of April 3, 2005
production from these 11 wells was 2230 barrels of oil per
day."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
This
announcement may contain forward-looking statements as defined
by the Securities and Exchange Commission. Harken, however,
believes that it is important to provide this operations update
and communicate its future expectations to its stockholders.
The forward-looking statements in this announcement such as
"potential", "accelerate" and "growth"
reflect the current view of management with regard to future
events and are subject to numerous known and unknown risks,
uncertainties and other factors that may cause the actual
results, performance, timing or achievements of Harken to
be materially different from any results, performance, timing
or achievements expressed or implied by such forward-looking
statements. These risks, uncertainties and other factors include,
among others, the risks described in Harken's filings
with the Securities and Exchange Commission including the
Annual Report on Form 10-K/A for the fiscal year ended December
31, 2004 filed on April 13, 2005. Statements regarding future
production are subject to all of the risk and uncertainties
normally associated with exploration, development and production
of oil and gas. These risks include, without limitation, variability
in the price received for oil and gas production, lack of
availability of oil field goods and services, environmental
risks, drilling and production risk, risk related to offshore
operations, and regulatory changes. Investors are cautioned
that any such statements are not guarantees of future performance
and that actual results or developments may differ materially
from those projected in the forward-looking statements. Although
Harken believes that the expectations reflected in the forward-looking
statements of this announcement are reasonable, it can give
no assurance that such expectations will prove to be correct
or that unforeseen developments will not occur. Harken undertakes
no duty to update or revise any forward-looking statements.
###
Back to Top
Harken Energy Raises $8.4 Million
Through Sale of Global Energy Shares to an Institutional Investor
Dallas, TX - April 14,
2005 - HKN, Inc. (AMEX: HEC) negotiated
and closed the sale of 2,812,716 shares from its existing
holdings in subsidiary Global Energy Development PLC, raising
$8.4 million in new capital for Harken Energy. This
sale of Harken's Global Energy Development shares to
an institutional investor was conducted through a private
sale at market prices. As a result of this transaction
Harken Energy now holds 21,037,213 shares or 74.79%
of Global Energy Development.
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in
this announcement including statements regarding future expectations,
objectives, intentions and plans for oil and gas exploration,
development and production may be regarded as "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made. Management's
current view and plans, however, are subject to numerous known
and unknown risks, uncertainties and other factors that may
cause the actual results, performance, timing or achievements
of Harken to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 13, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
Back to Top
Harken Energy Subsidiary Signs Exploration
and Exploitation Contract for the Block 95 Area in Peru
Dallas,
TX - April 11, 2005 - HKN, Inc.'s
(AMEX: HEC) 85% owned subsidiary, Global Energy Development
PLC ("Global"), announces that the new License
Contract between Global and Perupetro S.A. ("Perupetro"),
the national oil company of Peru, for the Exploration and
Exploitation of Hydrocarbons in the Block 95 Area located
in the Marañon Basin of Northeastern Peru has been
fully signed and is now effective.
Global
owns a 100% working interest in the contract subject only
to an initial 5% royalty, the most favorable terms received
in the company's history. The size of the ongoing
royalty is to be determined by future production levels.
The contract duration is approximately seven years for the
initial exploration phases and 23 years for the exploitation
phase.
The
contract assigns Global exclusive exploration and production
rights to approximately 1,255,000 acres. During Phase
1 of the contract, the terms require Global to complete within
12 months, environmental impact studies and plans for the
drilling of a well in the Bretaña field located in
Block 95.
If
Global elects to enter Phase 2 of the contract, the company
must acquire approximately 4800 square kilometers of micro-magnetic
geophysical data in and around the Bretaña field and
elsewhere throughout Block 95. Phase 2 has a time period
of 12 months. Should the company elect to enter Phase
3 it will be required to drill one exploratory well within
24 months. Phase 4 of the exploration period has a duration
of 12 months and requires the acquisition of 75 square kilometers
of 3 dimensional seismic, while Phases 5 and 6 both have a
duration of 12 months and require the drilling of one exploratory
well per phase.
Global
currently expects to drill its first well under this Contract
in the identified Bretaña field in late 2006 or early
2007 and follow this with an exploratory well elsewhere in
the Contract area in late 2008.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 5, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
Back to Top
HARKEN ENERGY PROVIDES DOMESTIC
OPERATIONS UPDATE
Dallas,
TX - April 5, 2005 - HKN, Inc.'s
(AMEX: HEC) wholly owned subsidiary, Gulf Energy Management
Company ("GEM"), has released updated production
figures and well completion status for its domestic oil and
gas operations, which are located primarily along the onshore
and offshore Texas and Louisiana Gulf Coast.
Currently,
GEM's net domestic production rate is at approximately
7.8 million cubic feet equivalent of natural gas per day.
GEM is committed to the continuing development of its domestic
operations and has increased its 2005 budgeted capital expenditures
to approximately $16 million to grow its domestic production
and reserves. The following field data updates the status
of GEM's domestic operations through the end of March
2005.
Lapeyrouse
Field, Terrebonne Parish - Louisiana
GEM continues to participate in an active field redevelopment
program that has included an interest in seven successful
wells in the Lapeyrouse field since the fourth quarter of
2003. GEM holds an average non-operated working interest of
10% in each of the seven wells that are together producing
at a combined gross rate of 17.5 million cubic feet equivalent
per day, for a net production to GEM of approximately 1.1
million cubic feet equivalent per day. Production is down
for this field from a combined gross rate of approximately
24 million cubic feet equivalent per day (or approximately
1.6 million cubic feet equivalent per day net to GEM) as reported
in our November 10, 2004, domestic operations update.
This is primarily the result of mechanical problems on two
of the wells. A workover program is planned in the second
quarter of 2005. An eighth well has been drilled and
logged productive. Production casing has been set and a completion
attempt is planned for the second quarter 2005. A ninth well
has been proposed and approved to a total depth of about 15,000'
true vertical depth (TVD) for drilling as soon as a rig becomes
available. GEM holds an approximately 39% operated working
interest in this ninth well. We anticipate a rig becoming
available during the second or third quarter of 2005.
Main
Pass, Plaquemines Parish - Louisiana
GEM has approved initiating the repair of an additional compressor
that has been off line for the past four years. This
investment will allow an increase in gas lift capacity in
the Main Pass Field and will permit GEM to return certain
wells to production once the additional compressor is back
on line. GEM holds an average 90% working interest in the
Main Pass field. GEM continues its geological and geophysical
study, utilizing the recently acquired license to 21 square
miles of 3D seismic data covering the area held by production
leases.
Raymondville,
Willacy and Kenedy Counties - Texas
Even though GEM continues to participate in an active recompletion
campaign, it is expected that field production has peaked.
GEM's current net production is about 1.45 million cubic
feet equivalent per day. GEM has an average 27% non-operated
working interest in this field.
Lake
Raccourci Field, Lafourche Parish - Louisiana
The Lake Raccourci field production rate is presently at approximately
6.5 million cubic feet per day, gross, which is down from
our last reported production rate of approximately 8.5 million
cubic feet per day. The decline in production is directly
attributable to the State Lease 1480 #2 well that has only
produced intermittently since it was shut in for Hurricane
Ivan last September, representing a loss of about 2.2 million
cubic feet equivalent per day, gross. GEM has attempted to
bring the well back onto production several times since the
extended shut in period, and each time it has produced for
a shorter run before it is unable to flow due to increased
water production and decreased pressure. A recompletion
attempt is being considered for the well. GEM holds a 40%
operated working interest in each of its Lake Raccourci wells.
GEM is presently seeking industry partners to drill a field
extension well. This prospect is a result of continuing interpretation
of GEM's 60 square mile reprocessed 3D seismic database.
New
3D Seismic Licenses Acquired - Louisiana
GEM has acquired a license covering approximately 155 square
miles of 3D seismic data in three different surveys across
south Louisiana. The largest database is in Terrebonne Parish
and includes approximately 70 square miles. Approximately
56 square miles is in Cameron Parish, and approximately 29
square miles in Iberville Parish. A number of leads have developed
in this continuing study. The process of cataloging and prioritizing
is underway.
New
Mineral Interests Acquired - Texas and Louisiana
GEM acquired mineral interests in 6 drill-ready prospects
in Texas and Louisiana during the second half of 2004. An
update for each of the six prospects comprised of South Beach
Field, Branville Bay Field, Delarge Field, Point-a-la-Hache
Field, Allen Ranch Field, and S.E. Nada Field is provided
below.
South
Beach Field, Chambers County - Texas
GEM has a non-operated working interest of 9.375% in this
area. The initial well was drilled to a true vertical depth
of 10,750 feet during the forth quarter of 2004. The well
was logged productive in two sands. The well has been
completed in the lower sand. First production was in late
December 2004. Current gross production is about 2.7 million
cubic feet per day and 240 barrels of condensate per day.
A second well has been drilled and logged productive. Completion
attempt and subsequent flow tests are now in progress.
Branville
Bay Field, Plaquemines Parish - Louisiana
GEM has a non-operated working interest of 12.5% in this area.
The initial well was drilled to a total depth of 7,400 feet
in the fourth quarter of 2004. The well was dually completed
in the two logged productive sands. First production
was in February 2005, and is currently producing a total of
about 500 barrels of oil per day, and .8 million cubic feet
per day, gross. A second well has been proposed and approved
to a total depth of 8,000 feet, and is expected to spud as
a rig becomes available in the second quarter of 2005.
Delarge
Field, Terrebonne Parish - Louisiana
Initial well was drilled to a total depth of 11,500 feet true
vertical depth in December 2004, logged not productive, plugged
and abandoned. GEM has a non-operated working interest of
12.5% in this area. Geological and geophysical studies continue
to evaluate other prospect leads in the field.
Point-a-la-Hache
Field, Plaquemines Parish - Louisiana
The initial well, State Lease 18077 #1, was drilled to a true
vertical depth of 10,300 feet in mid December 2004. The well
was logged productive, completed and tested at a rate of 200
barrels of oil per day, and 0.8 million cubic feet per day,
in the lower sand of two sands that both logged productive.
First production is expected in the second quarter of 2005.
GEM maintains a 25% operated working interest in the area.
Allen
Ranch Field, Colorado County - Texas
The initial well, the Hancock Gas Unit #1, was drilled to
a measured depth of 16,983 feet in late January 2005. The
well was logged productive in four sands, and is in the process
of completing, perforating, and hydraulic fracturing. GEM
owns an 11.25% non-operated working interest in the area.
First production is planned for May, 2005.
Southeast
Nada Field, Colorado County - Texas
GEM has a 17% non-operated working interest in this area.
The initial well, the Popp et al #1, was drilled to a measured
depth of 10,030 feet in late March 2005. The well was logged
productive in two sands, and is in the process of completing,
and subsequent flow testing. First production is expected
in the latter part of the second quarter of 2005.
Coalbed
Methane Projects - Indiana and Ohio
GEM
has entered into two significant Exploration and Development
Agreements in Indiana and Ohio. Each prospect provides for
an area of mutual interest of approximately 400,000 acres.
The agreements provide for a phased delineation, pilot and
development program, with corresponding staged expenditures.
A contracted third party with a long track record in successful
coalbed methane development provides expert advice for these
projects.
"The
addition of large potential coalbed methane prospects to our
strategic plan offers long term balance to our strong Gulf
Coast portfolio of high rate, quicker depletion prospects,"
said Jim Denny, President of Gulf Energy Management Company.
"Our high-percentage completion rate continues in our
core areas, allowing us to add production at reasonable finding
costs. We continue to add prospects and manage our growth
opportunities with a combination of in-house and outsourced
technical expertise."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements regarding
future expectations, objectives, intentions and plans for
oil and gas exploration, development and production may be
regarded as "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made. Management's current view and
plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K/A dated
April 5, 2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
Back to Top
HKN, Inc. Files
10-K/A - Amended Annual Report
Dallas,
TX - April 5, 2005 - HKN, Inc.
("Harken")(Amex: HEC) has filed a Form 10-K/A
with the Securities and Exchange Commission. The amended
annual report restates the company's financials to reflect
adjusted treatment of stock options for its 85%-owned subsidiary
Global Energy Development for the year ended December 31,
2004 and for the third quarter of 2004. For more information
please review the Form 10-K/A amended annual report filed
April 5, 2005.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements about
our plans, objectives, intentions, and expectations are "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made and are subject to known and
unknown risks and uncertainties and inaccurate assumptions
that could cause actual results to differ materially from
those expected or implied by the forward-looking statements.
These risks and uncertainties include our history of losses,
the fluctuation in oil and gas prices, our requirements for
capital expenditures, competition and the other risk factors
identified in our reports filed with the SEC. Readers
are cautioned not to place undue reliance upon these forward-looking
statements, which speak only as the date hereof.
###
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Harken Energy Acquires Second Coalbed
Methane Prospect
Dallas,
TX - March 29, 2005 - HKN, Inc. (Amex: HEC)
announced today that its wholly owned subsidiary, Gulf Energy
Management Company, has entered into an Exploration and Development
Agreement with Ohio Cumberland L.P., a Texas limited partnership,
for the joint exploration and development of coalbed methane
within the Cumberland Prospect Area consisting of approximately
400,000 acres in Guernsey, Noble, Muskingum, Washington and
Morgan counties of Ohio. Harken Energy announced on
March 23, 2005, that it had entered into a similar agreement
for a 400,000 acre coalbed methane prospect located in Indiana.
Today's announcement marks the second major acquisition
of coalbed methane prospect acreage in 2005 for Harken Energy,
bringing its total coalbed methane prospect portfolio to approximately
800,000 acres.
Gulf
Energy Management's obligations under this new agreement
include funding 100% of the initial $7.5 million of costs
to carry out the joint exploration and development of the
project in return for a 65% working interest in the Cumberland
Prospect Area. The agreement also provides that Gulf
Energy Management receive an 82.5% net revenue interest.
Gulf Energy Management's funding obligation is to be
allocated among three separate technical phases of the project.
At the conclusion of each of the first two phases, Gulf Energy
Management may elect to terminate the agreement, thereby reducing
its commitments. Complete details of the agreement may
be found in the Form 8-K filed today with the Securities and
Exchange Commission.
"The
acquisition in the Cumberland Prospect Area along with the
recently acquired Indiana Posey Prospect Area provide Gulf
Energy Management with a strong platform to optimize opportunities
available in coalbed methane," said Jim Denny, President
of Gulf Energy Management. "These opportunities
together with our existing oil and gas holdings located along
the Texas and Louisiana Gulf Coast should allow Gulf Energy
Management to continue with its growth strategy objectives."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain
statements in this announcement including statements about
our plans, objectives, intentions, and expectations are "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made and are subject to known and
unknown risks and uncertainties and inaccurate assumptions
that could cause actual results to differ materially from
those expected or implied by the forward-looking statements.
Harken's actual results could differ materially from
those anticipated in the forward-looking statements for many
reasons, including the risk that additional "material
weaknesses", as disclosed in the Form 8-K filed by Harken
on March 18, 2005, or other internal control deficiencies
with the meaning of Section 404 of the Sarbanes-Oxley Act
of 2002 are identified, and the risk that additional accounting
errors may be identified. Readers are cautioned not
to place undue reliance upon these forward-looking statements,
which speak only as the date hereof.
###
Back
to Top
Harken Energy Acquires 400,000 Acre
Coalbed Methane Prospect Located in Indiana
Dallas, TX -
March 23, 2005 - HKN, Inc., (Amex: HEC) announced
today that its wholly-owned subsidiary, Gulf Energy Management
Company ("GEM") entered into an Exploration and
Development Agreement with Indiana Posey L.P., a Texas limited
partnership, for the joint exploration and development of
coal bed methane within the Posey Prospect Area consisting
of approximately 400,000 acres in Posey, Gibson and Vanderburgh
counties of Indiana.
Gulf Energy Management's
obligations under the agreement include funding 100% of the
initial $7.5 million of costs to carry out the joint exploration
and development of the project in return for a 65% interest
in the Posey Prospect Area. The agreement also provides
that Gulf Energy Management receive an 82.5% net revenue interest.
Gulf Energy Management's funding obligation is to be
allocated among three separate technical phases of the project.
At the conclusion of each of the first two phases, Gulf Energy
Management may elect to terminate the agreement, thereby reducing
its commitments. Complete details of the agreement may
be found in the Form 8-K filed today with the Securities and
Exchange Commission.
Commenting on
the acquisition Jim Denny, President of Gulf Energy Management,
said, "The acquisition in the Posey Prospect Area is
an opportunistic transaction that adds to and diversifies
our existing oil and gas holdings located along the Texas
and Louisiana Gulf Coast. Although we are just in the
early stages of our Posey Prospect Area coal bed methane development
program, we are excited about the potential and believe it
provides an attractive opportunity for growth."
HKN, Inc. is engaged in oil and gas exploration, development
and production operations both domestically and internationally
through its various subsidiaries. Additional information may
be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements
in this announcement including statements about our plans,
objectives, intentions, and expectations are "forward-looking
statements" within the meaning of the Securities Exchange
Act of 1934, as amended. Forward-looking statements
are based on the opinions and estimates of management at the
time the statements are made and are subject to known and
unknown risks and uncertainties and inaccurate assumptions
that could cause actual results to differ materially from
those expected or implied by the forward-looking statements.
Harken's actual results could differ materially from
those anticipated in the forward-looking statements for many
reasons, including the risk that additional "material
weaknesses" as disclosed in the 8-K filed by Harken
Energy on March 18, 2005, or other internal control deficiencies
with the meaning of Section 404 of the Sarbanes-Oxley Act
of 2002 are identified, and the risk that additional accounting
errors may be identified. Readers are cautioned not
to place undue reliance upon these forward-looking statements,
which speak only as the date hereof.
###
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Harken Energy Files 8-K Reporting
Non-Reliance on 2004 Financial Statements
Dallas,
TX - March 18, 2005 - HKN, Inc. ("Harken")(Amex: HEC) announced it has
filed a Form 8-K report with the Securities and Exchange Commission
disclosing that the company was advised by its independent registered
public accounting firm, Hein & Associates LLP ("Hein"),
subsequent to the filing of Harken's Form 10-K of the
discovery of an error in Harken's 2004 financial statements.
This error pertains to the unrecorded accounting effect of the
third quarter 2004 modification of the employee stock option
plan of Global Energy Development PLC ("Global").
Harken owns an 85% interest in Global. As result of the
discovered error, Harken reported that the financial statements
for the year ended December 31, 2004 and for the third quarter
of 2004 should no longer be relied upon. Harken will be reclassifying
the option plan from a fixed option plan to a variable option
plan and recognizing compensation expense related to Global's
stock options in Harken's previously issued consolidated
financial statements for the year ended December 31, 2004 and
for the third quarter of 2004. For more information please
review the Form 8-K report.
HKN, Inc.
is engaged in oil and gas exploration, development and production
operations both domestically and internationally through its
various subsidiaries. Additional information may be found
at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
Certain statements in
this announcement including statements about our plans, objectives,
intentions, and expectations are "forward-looking statements"
within the meaning of the Securities Exchange Act of 1934,
as amended. Forward-looking statements are based on
the opinions and estimates of management at the time the statements
are made and are subject to known and unknown risks and uncertainties
and inaccurate assumptions that could cause actual results
to differ materially from those expected or implied by the
forward-looking statements. Harken's actual results
could differ materially from those anticipated in the forward-looking
statements for many reasons, including the risk that additional
"material weaknesses" or other internal control
deficiencies with the meaning of Section 404 of the Sarbanes-Oxley
Act of 2002 are identified, the risk that additional accounting
errors are identified, and the risk that Harken is required
to restate its prior financial statements for period other
than the third quarter of 2004 and fiscal year 2004.
Readers are cautioned not to place undue reliance upon these
forward-looking statements, which speak only as the date hereof.
###
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Harken Reports 45% Increase in Operating
Margin in 2004
Dallas, Texas -
3/16/05 - HKN, Inc. ("Harken")
(AMEX: "HEC") today reported financial results
for the year ended December 31, 2004. In 2004, Harken
continued in its efforts to improve its capital structure
while focusing on developing its oil and gas assets and improving
cash flow from operations. As summarized below, Harken
ended 2004 with approximately $28.6 million in Cash, outstanding
Debt of $8.6 million, and positive Working Capital of approximately
$21.8 million, a 272% increase over the prior year.
Balance Sheet Summary:
| |
|
Year
Ended
December 31, |
| (Thousands of dollars)
|
|
2003
|
|
2004
|
| |
|
|
|
|
| Current ratio (1) |
|
1.88 to 1 |
|
2.54 to 1 |
| Working capital (2)
|
$ |
7,886 |
$ |
21,844 |
| Cash |
$ |
12,173 |
$ |
28,632 |
| Total debt |
$ |
7,360 |
$ |
8,578 |
| Total cash less debt
|
$ |
4,813 |
$ |
20,054 |
| Stockholders'
equity |
$ |
52,761 |
$ |
56,326 |
| Total debt to equity
|
|
0.14 to 1 |
|
0.15 to 1 |
(1)
Current ratio is calculated as current assets divided by current
liabilities
(2)
Working capital in the difference between current assets and
current liabilities
Additionally, in 2004 Harken generated almost $13 million
in Operating Margin, (non-GAAP; see reconciliation below)
an increase of approximately 45% from 2003 results.
Operating
Results:
| Year
Ended
December 31, |
|
| |
|
2003
|
|
2004
|
| |
|
|
|
|
| Total Revenues |
$ |
27,290,000
|
$ |
29,995,000
|
| Oil and Gas Operating
Expenses |
|
9,469,000 |
|
7,964,000 |
| General and Administrative
Expenses |
|
9,210,000
|
|
9,222,000 |
|
Operating Margin (Non-GAAP; see
Reconciliation below)
|
|
8,611,000 |
|
12,809,000 |
| Depreciation and Amortization
|
|
8,941,000 |
|
10,713,000 |
| Accretion Expense |
|
460,000 |
|
388,000 |
| Increase in Global
Warrant Liability |
|
7,000 |
|
(A)
14,207,000 |
| Litigation and contingent
liability settlements, net |
|
1,125,000 |
|
- |
| Interest Expense and
Other, net |
|
3,394,000 |
|
414,000 |
| Gains from Repurchases
/ Exchanges of |
|
|
|
|
|
Convertible Notes |
|
5,525,000 |
|
155,000 |
| (Loss)/Gain on Investment
|
|
(488,000) |
|
990,000 |
| Income Tax (Expense)
/ Benefit |
|
184,000 |
|
(579,000) |
| Minority Interest of
Subsidiary |
|
(89,000) |
|
(323,000) |
| Loss Before Cumulative
Effect of Change in
Accounting Principle |
|
(184,000) |
|
(12,670,000) |
| Cumulative Effect of
Change in Accounting |
|
|
|
|
|
Principle |
|
(813,000)
|
|
- |
| Net Loss |
$ |
(997,000)
|
$ |
(12,670,000) |
| Accrual of Dividends
Related to Preferred Stock |
|
(3,676,000) |
|
(2,884,000) |
| Exchange of Preferred
Stock |
|
- |
|
(1,123,000) |
| Payment of Preferred
Stock Dividend Liability
In Common Stock |
|
6,805,000 |
|
3,492,000 |
| Net Income (Loss) Attributed
to Common Stock |
$ |
2,132,000 |
$ |
(13,185,000) |
| Basic Net Income (Loss)
per Common Share |
|
0.02 |
|
(0.07) |
| Basic Weighted Average
Shares Outstanding |
|
112,694,654 |
|
201,702,235
|
| Diluted Net Income
(Loss) per Common Share |
|
(0.03) |
|
(0.07) |
| Diluted Weighted Average
Share Outstanding |
|
112,790,327 |
|
201,702,235 |
Note
(A) - During 2004, there was a dramatic increase in
Harken's 85% owned subsidiary's, Global Energy
Development PLC ("Global"), common share price
from approximately 50 UK pence at December 31, 2003 to 153
UK pence at December 31, 2004. Global's shares are traded
on the Alternative Investment Market of the London Stock Exchange.
Correspondingly, the fair value of the Global Warrants held
by Outside Parties, issued in 2002, increased $14 million
to approximately $15 million at December 31, 2004. The warrants
are accounted for as a derivative liability in accordance
with SFAS No. 133 which requires the warrant liability to
be adjusted to estimated fair value each period with any changes
in value reflected in earnings. The fair value of the warrants
is calculated by an outside third party firm and is based
on the underlying market price of the Global common stock.
Although Harken owns approximately 85% of Global and has seen
its market value as reflected in Global's market capitalization
increase from $25 million to over $80 million in 2004, Harken
recorded an unrealized loss related to the change in fair
value of the Global Warrants of $14 million during the year
ended December 31, 2004. Harken holds warrants, issued in
2002, to purchase 6,487,481 of Global shares at 60 UK pence
per share. The estimated fair market value of these warrants
at December 31, 2004 was approximately $11.8 million, as calculated
by a third-party firm. Because Global is a consolidated subsidiary,
the increased value of these warrants held by Harken is not
reflected in the consolidated financial statements.
2004 Operations:
During 2004, Harken's revenues were positively affected
by rising commodity prices for natural gas and crude oil.
These increases more than offset our oil and gas production
declines in 2004. Although Harken's 2004 consolidated
net natural gas production declined 16% to 1.8 Bcf and crude
oil net production declined 14% to 546,000 Bbls compared to
2003, our total revenues and other increased 10% to approximately
$30 million from approximately $27 million in 2003.
The decrease in Harken's domestic subsidiary's,
Gulf Energy Management Company ("GEM"), oil and
gas production in 2004 compared to the prior year was due
to the December 2003 sale of the majority of GEM's Texas
panhandle properties and due to Hurricane Ivan which passed
through the Louisiana Gulf Coast in September 2004.
Weather related shut downs of Gulf Coast properties required
extensive efforts and time to bring back on production.
By late fourth quarter 2004, the majority of all of our Gulf
Coast properties had resumed normal production. The majority
of GEM's oil and gas production is located along the
Gulf of Mexico.
Global's oil revenues increased in 2004 despite a 7%
decrease in production volumes due in part to declines in
producing wells but due mainly to our decision to workover
certain wells that reduced oil production during the workover
process. Oil production from newly drilled and completed wells
drilled during 2004 is expected to help reverse this decline
in 2005.
In September 2004, Harken invested $12.5 million in a start-up
energy company, IBA, which was formed to focus primarily on
opportunities created by the recent deregulation of the energy
markets in Eastern Europe. It is anticipated that IBA will
engage in trading gas futures contracts, principally in Hungary
as well as in the United States. IBA had minimal trading operations
in 2004. In exchange for Harken's $12.5 million cash
investment, Harken received 12,500 shares of nonvoting preferred
stock along with warrants to purchase 48% of IBA's common
stock for a nominal amount. Harken currently holds three
of the five IBA Board of Directors positions. Harken's
preferred stock investment represents almost 100% of IBA's
initial working capital as of December 31, 2004.
In accordance with generally accepted accounting principles,
Harken has consolidated the assets, liabilities and results
of operations of IBA as of December 31, 2004 and for the period
from September 10, the closing date of the transaction, through
December 31, 2004. IBA's net loss included in the Consolidated
Results of Operations for the period ended December 31, 2004
was approximately $1 million.
2005 Outlook:
During 2005, Harken is concentrating on the development and
growth of its oil and gas assets and energy-based growth opportunities.
In February 2005, Harken's Board of Directors approved
the 2005 capital expenditure program of approximately $34
million. Of the 2005 capital expenditure budget, approximately
$16 million is related to GEM and approximately $18 million
is related to Global's planned capital expenditures.
Harken expects to fund these capital expenditures through
available cash on hand and through projected cash flow from
operations in 2005.
Chairman's Comment:
Alan G. Quasha, Harken's Chairman, stated, "In
2004, higher oil and natural gas prices allowed us to improve
our cash flow from operations. Thus, for the first time
in a while, Harken was able to spend money towards rebuilding
its reserves and reversing its production declines.
The success we achieved with the approximately $18 million
we spent in 2004 should accomplish this reversal and has given
our Board of Directors the confidence to almost double our
drilling budget to $34 million in 2005."
More information is available in HKN, Inc.'s
Form 10-K for the period ended December 31, 2004 which may
be accessed through the Company's website at www.harkenenergy.com.
NON-GAAP FINANCIAL MEASURE
Reconciliation of Operating Margin
to Net Income (Loss):
| Year Ended |
| |
December 31, |
| |
2003 |
|
2004 |
| |
|
|
|
| |
|
|
|
| Net Loss (GAAP) |
$
(997,000) |
|
$
(12,670,000) |
| Cumulative Effect of Change in
Accounting Principle |
813,000 |
|
- |
| Minority Interest in Earning of
Subsidiary |
89,000 |
|
323,000 |
| Income tax Expense (Benefit) |
(184,000) |
|
579,000 |
| (Gain) / Loss on Sale of Investment |
488,000 |
|
(990,000) |
| Gain on Extinguishment of Debt |
(5,525,000) |
|
(155,000) |
| Loss from Increase in Global Warrant
Liability |
7,000 |
|
14,207,000 |
| Litigation and contingent liability
settlements, net |
1,125,000 |
|
- |
| Interest Expense and Other, net |
3,394,000 |
|
414,000 |
| Accretion Expense |
460,000 |
|
388,000 |
| Depreciation and Amortization |
8,941,000 |
|
10,713,000 |
| Operating Margin |
$
8,611,000
_____________ |
|
$
12,809,000
_____________ |
Management
believes the presentation of this non-GAAP financial measure,
in connection with the results for the year ended December
31, 2004, provides useful information to investors regarding
the Company's results of operations. Management
also believes that this non-GAAP financial measure allows
investors to better evaluate on-going business performance
and the factors that influenced performance during the period
under the report. This non-GAAP financial measure should
be considered in addition to, and not as a substitute for,
financial measures prepared in accordance with GAAP.
Certain
statements in this news release including phrases such as
"in our view", "we believe", "we
consider", "we expect," "we anticipate"
and "we hope" relating to Harken's revenue,
profit, dividends, cash flow, securities held by Harken and
earnings expectations; statements regarding future expectations
and plans for oil and gas exploration, development and production;
and statements regarding commodity pricing expectations may
be regarded as "forward looking statements" within
the meaning of the Securities Litigation Reform Act.
These forward-looking statements reflect the current view
of management with regard to its plans and expectations and
other future events. Management's current view
and plans, however, are subject to numerous known and unknown
risks, uncertainties and other factors that may cause the
actual results, performance, timing or achievements of Harken
to be materially different from any results, performance,
timing or achievements expressed or implied by such forward-looking
statements. The various uncertainties, variables, and
other risks include those discussed in detail in the Company's
SEC filings, including the Annual Report on Form 10-K for
the fiscal year ended December 31, 2004 filed on March 16,
2005. Although Harken believes that the expectations
reflected in the forward-looking statements of this announcement
are reasonable, it can give no assurance that such expectations
will prove to be correct or that unforeseen developments will
not occur. Harken undertakes no duty to update or revise
any forward-looking statements. Actual results may vary
materially.
###
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Harken Energy announces the Successful
Workover of Canacabare # 1 in the Anteojos Field in Colombia
Combined
production from two zones tested at 198 barrels of oil per
day
Dallas,
TX - March 14, 2005 - HKN, Inc.'s (AMEX: HEC) 85% owned subsidiary Global
Energy Development PLC announced today the completion of the
successful workover and the re-commencement of production
from the Canacabare # 1 well located in the Anteojos field
within its Alcaravan Association Contract in Colombia.
Canacabare
# 1 was the first well to be brought on production in the
Anteojos field, which is adjacent to the established Palo
Blanco field also within the Alcaravan Contract area.
During the workover, Global successfully added the Middle
Carbonera C-7 formation and tested the two producing zones
of Canacabare # 1 at a combined maximum rate of 198 barrels
of oil per day (bopd) of 27 degree API gravity oil.
Canacabare # 1 had been off-production since April 2004, at
which time the production rate was averaging 100 bopd.
Commenting
on Canacabare # 1, Stephen C. Voss, Global's Managing
Director, said, "We are pleased to return our Canacabare
# 1 asset to production at improved rates from last year,
resulting from the completion of certain mechanical repairs
and the addition of new volumes from the Middle Carbonera
C-7 formation. The Canacabare # 1 not only adds additional
production, but also affords us production from another field
and its medium quality gravity will further enhance the overall
sales blend quality of Global's Central Llanos oil.
The Company will also be reviewing other development drilling
opportunities offset to the Canacabare # 1 during 2005."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com,
or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
This
announcement may contain forward-looking statements as defined
by the Securities and Exchange Commission. Harken, however,
believes that it is important to provide this operations update
and communicate its future expectations to its stockholders.
The forward-looking statements in this announcement such as
"potential", "accelerate" and "growth"
reflect the current view of management with regard to future
events and are subject to numerous known and unknown risks,
uncertainties and other factors that may cause the actual
results, performance, timing or achievements of Harken to
be materially different from any results, performance, timing
or achievements expressed or implied by such forward-looking
statements. These risks, uncertainties and other factors include,
among others, the risks described in Harken's filings
with the Securities and Exchange Commission including the
Annual Report on Form 10-K for the fiscal year ended December
31, 2003 filed on March 26, 2004 and its Form 10-Q for the
quarter and nine months ended September 30, 2004 filed on
November 5, 2004. Statements regarding future production are
subject to all of the risk and uncertainties normally associated
with exploration, development and production of oil and gas.
These risks include, without limitation, variability in the
price received for oil and gas production, lack of availability
of oil field goods and services, environmental risks, drilling
and production risk, risk related to offshore operations,
and regulatory changes. Investors are cautioned that any such
statements are not guarantees of future performance and that
actual results or developments may differ materially from
those projected in the forward-looking statements. Although
Harken believes that the expectations reflected in the forward-looking
statements of this announcement are reasonable, it can give
no assurance that such expectations will prove to be correct
or that unforeseen developments will not occur.
Harken undertakes no duty to update or revise any forward-looking
statements.
###
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Harken Energy Announces $34 Million
Capital Expenditure Budget for 2005
Harken increases drilling and development
budget by 87% over 2004
Dallas, TX - February 17,
2005 - HKN, Inc. (AMEX: HEC) announced its
2005 capital expenditure budget totaling approximately $34
million for its two principal subsidiaries, representing an
87% increase from Harken's 2004 capital expenditure budget.
Harken anticipates funding its 2005 capital programs from
cash on hand and internally generated cash flow from operations.
Harken's 85%-owned subsidiary,
Global Energy Development PLC ("Global"), which
operates in Colombia with additional agreements in Peru and
Panama, has budgeted approximately $18 million of capital
expenditures in 2005 to continue to develop its crude oil
assets in Middle America.
The majority of Global's 2005
capital expenditure plans are targeted for Global's operations
in its Palo Blanco Field, Bolivar Field and Rio Verde Field
in its existing Association and Exploration and Production
Contracts in Colombia. Global's capital expenditure
budget also includes costs for other seismic and exploration
activities in Peru, Panama and Colombia.
Harken's principal domestic
subsidiary, Gulf Energy Management Company ("GEM"),
whose primary operations are along the Gulf Coast of Texas
and Louisiana, has budgeted approximately $16 million for
its field development activities in 2005. GEM's projected
2005 capital budget targets exploration and development drilling
in the Lapeyrouse Field, Lake Raccourci Field, Main Pass Field
and other fields along the Texas and Louisiana Gulf Coast.
Harken is engaged in oil and
gas exploration, development and production operations both
domestically and internationally through its various subsidiaries.
Additional information may be found at Harken's
Web site, www.harkenenergy.com
, or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
This announcement may
contain forward-looking statements as defined by the Securities
and Exchange Commission including terms such as "anticipates"
and statements relating to expectations as to programs, projects,
development and growth. . The forward-looking
statements in this announcement reflect the current view of
management with regard to future events and are subject to
numerous known and unknown risks, uncertainties and other
factors that may cause the actual results, performance, timing
or achievements of Harken to be materially different from
any results, performance, timing or achievements expressed
or implied by such forward-looking statements. These
risks, uncertainties and other factors include, among others,
the risks described in Harken's filings with the Securities
and Exchange Commission including the Annual Report on Form
10-K for the fiscal year ended December 31, 2003 filed on
March 26, 2004 and its Form 10-Q for the quarter ended September
30, 2004 filed on November 5, 2004. Statements regarding
future production are subject to all of the risk and uncertainties
normally associated with exploration, development and production
of oil and gas. These risks include, without limitation,
variability in the price received for oil and gas production,
lack of availability of oil field goods and services, environmental
risks, drilling and production risk, risk related to offshore
operations, and regulatory changes. Investors are cautioned
that any such statements are not guarantees of future performance
and that actual results or developments may differ materially
from those projected in the forward-looking statements.
Although Harken believes that the expectations reflected in
the forward-looking statements of this announcement are reasonable,
it can give no assurance that such expectations will prove
to be correct or that unforeseen developments will not occur.
Harken undertakes no duty to update or revise any forward-looking
statement.
###
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Harken Energy Announces Successful
Re-completion, Commencement of Production from Macarenas #
1 on Rio Verde Contract in Colombia
New Well Tested at 605 Barrels of Oil per Day
Dallas,
TX - January 27, 2005 - HKN, Inc. (AMEX: HEC)
announced its 85% owned subsidiary, Global Energy Development
PLC ("Global"), successfully re-completed and commenced
production from the Macarenas # 1 well within its 75,000 acre
Rio Verde Exploration and Production Contract in Colombia.
The Macarenas # 1 well tested at a maximum potential rate
of 605 barrels of oil per day of 36 degree API gravity oil.
Global owns a 100% working interest in the Macarenas # 1 well.
Global
currently produces from two wells on the Rio Verde Contract
with the Company intending to explore opportunities for additional
development around these two wells in the medium-term.
Commenting
on the Macarenas # 1 and the Rio Verde Contract, Stephen C.
Voss, Managing Director of Global Energy Development PLC said,
"Progress made on the Rio Verde Contract continues to
run ahead of our initial expectations with two wells having
been brought on production in just over a month. Within
Global's portfolio are four contracts in Colombia from which
production is currently being achieved and the resulting cash
flow allows us to consider potentially significant opportunities
including additional development and exploration opportunities
throughout the remaining Rio Verde acreage."
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com
, or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
This
announcement may contain forward-looking statements as defined
by the Securities and Exchange Commission. Harken, however,
believes that it is important to provide this operations update
and communicate its future expectations to its stockholders.
The forward-looking statements in this announcement reflect
the current view of management with regard to future events
and are subject to numerous known and unknown risks, uncertainties
and other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements. These
risks, uncertainties and other factors include, among others,
the risks described in Harken's filings with the Securities
and Exchange Commission including the Annual Report on Form
10-K for the fiscal year ended December 31, 2003 filed on
March 26, 2004 and its Form 10-Q for the quarter ended September
30, 2004 filed on November 5, 2004. Statements regarding
future production are subject to all of the risk and uncertainties
normally associated with exploration, development and production
of oil and gas. These risks include, without limitation,
variability in the price received for oil and gas production,
lack of availability of oil field goods and services, environmental
risks, drilling and production risk, risk related to offshore
operations, and regulatory changes. Investors are cautioned
that any such statements are not guarantees of future performance
and that actual results or developments may differ materially
from those projected in the forward-looking statements.
Although Harken believes that the expectations reflected in
the forward-looking statements of this announcement are reasonable,
it can give no assurance that such expectations will prove
to be correct or that unforeseen developments will not occur.
Harken undertakes no duty to update or revise any forward-looking
statements
###
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to Top
Harken Energy Completes Two Million
Share Buyback of Common Stock
Dallas,
TX - January 10, 2005 - HKN, Inc. (AMEX: HEC)
announced it completed the buyback of two million shares of
its common stock at an average cost of $0.52 per share. These
shares were repurchased as part of the stock repurchase plan
previously announced in September of 2004.
HKN, Inc. is engaged in oil and gas exploration,
development and production operations both domestically and
internationally through its various subsidiaries. Additional
information may be found at the Harken Energy Web site, www.harkenenergy.com
, or by calling Bevo Beaven or Bill Conboy at CTA Public Relations
at (303) 665-4200.
This
announcement may contain forward-looking statements as defined
by the Securities and Exchange Commission. Harken, however,
believes that it is important to provide this operations update
and communicate its future expectations to its stockholders.
The forward-looking statements in this announcement reflect
the current view of management with regard to future events
and are subject to numerous known and unknown risks, uncertainties
and other factors that may cause the actual results, performance,
timing or achievements of Harken to be materially different
from any results, performance, timing or achievements expressed
or implied by such forward-looking statements. These
risks, uncertainties and other factors include, among others,
the risks described in Harken's filings with the Securities
and Exchange Commission including the Annual Report on Form
10-K for the fiscal year ended December 31, 2003 filed on
March 26, 2004 and its Form 10-Q for the quarter ended September
30, 2004 filed on November 5, 2004. Statements regarding
future production are subject to all of the risk and uncertainties
normally associated with exploration, development and production
of oil and gas. These risks include, without limitation,
variability in the price received for oil and gas production,
lack of availability of oil field goods and services, environmental
risks, drilling and production risk, risk related to offshore
operations, and regulatory changes. Investors are cautioned
that any such statements are not guarantees of future performance
and that actual results or developments may differ materially
from those projected in the forward-looking statements.
Although Harken believes that the expectations reflected in
the forward-looking statements of this announcement are reasonable,
it can give no assurance that such expectations will prove
to be correct or that unforeseen developments will not occur.
Harken undertakes no duty to update or revise any forward-looking
statements
###
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