GeoMet, Inc. Announces Preliminary 2008 Gas Sales Volumes, Guidance for 2009 Gas Sales Volumes and 2009 Capital Spending
Houston, Texas – January 29, 2009 - GeoMet, Inc. (NASDAQ: GMET) today announced preliminary 2008 net gas sales volumes; estimated 2009 net gas sales volumes; and capital spending plans for 2009.
2008 Gas Sales Volumes and Guidance for 2009 Gas Sales Volume Growth
Preliminary estimated average daily net gas sales volumes for 2008 are 20.4 MMcf, an increase of 4.3% over 2007.
Average daily net sales volumes in 2009 are estimated to increase from 10% to 12% as compared to the 2008 period.
2009 Capital Expenditure Budget
GeoMet’s capital expenditure budget for 2009 totals approximately $24 million as compared to estimated capital expenditures of $57 million in 2008. Approximately $ 10.1 million of the 2009 capital budget is allocated to the Pond Creek field in Virginia and West Virginia; $7.7 million to the Gurnee field and the Chattanooga shale prospect (Garden City) in Alabama; and $4.8 million to the Peace River field in British Columbia. The decision to reduce budgeted capital expenditures in 2009 is a direct response to the unsettled conditions in the credit markets coupled with a low natural gas price outlook. As of December 31, 2008, GeoMet had $63.5 million of unused credit committed under its bank credit agreement which matures in January 2011. It is currently projected that bank debt at year-end 2009 will be less than $120 million.
Darby Seré, GeoMet’s President and CEO stated, “We intend to limit capital spending to our internally generated cash flow during this period of capital market and natural gas price uncertainty. Fortunately, due to the very shallow decline profile of our production and the low risk nature of our drilling activity, even at these reduced spending levels we expect to grow 2009 sales volumes in excess of 10% compared to 2008. We are prepared to further adjust our capital spending in either direction as conditions in the capital markets and natural gas price environment become more clear. In addition, year-end proved reserve estimates will be finalized shortly and we will make an announcement soon thereafter”.
Forward-Looking Statements Notice
This press release may contain “forward-looking statements” within the meaning of Section27A of the Securities Act of 1933, as amended, and Section21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Among those risks, trends and uncertainties are our estimate of the sufficiency of our existing capital sources, our ability to raise additional capital to fund cash requirements for future operations, the uncertainties involved in estimating quantities of proved oil and natural gas reserves, in prospect development and property acquisitions and in projecting future rates of production, the timing of development expenditures and drilling of wells, and the operating hazards attendant to the oil and gas business. In particular, careful consideration should be given to cautionary statements made in the various reports the Company has filed with the SEC. GeoMet undertakes no duty to update or revise these forward-looking statements.
About GeoMet, Inc.
GeoMet, Inc. is an independent energy company primarily engaged in the exploration for and development and production of natural gas from coal seams (“coalbed methane”) and non-conventional shallow gas. Our principal operations and producing properties are located in the Cahaba Basin in Alabama and the Central Appalachian Basin in West Virginia and Virginia. We also control additional coalbed methane and oil and gas development rights, principally in Alabama, British Columbia, Virginia, and West Virginia.
For more information please contact Stephen M. Smith with GeoMet at (713)287-2251 (firstname.lastname@example.org); John Baldissera with BPC Financial Marketing (800) 867-0938; or visit our website at www.geometinc.com.