Badger Explorer ASA - 2Q and 1H 2009 results

The second quarter has been eventful and characterised by steady progress. Badger Explorer ASA has not experienced any significant set-backs and through extensive drilling tests, functions of the Badger Explorer tool have been verified. The work has involved design improvements, drilling of numerous holes in representative rock samples, transporting and compaction of drill cuttings into firm and solid plugs behind the Badger Explorer tool. "The Badger Explorer development project has made good progress during the summer. Successful drilling and testing of the functionality has led to a verification of key functions. In addition we have been able to make solid plugs. To me the recent development is a further indication of the system's functionality and potential, and this provides reasons for optimism regarding the activities planned for the coming months", says President and CEO, Kjell Erik Drevdal. Numerous natural self-burial test sites have been identified and investigated, however none of them fulfil all the test site criteria set by the Company. The search for a natural test site and alternatives continues. During the second quarter of 2009 more than 50 jig-based systems drilling tests incorporating key functions of the tool have successfully been performed in different types of rock. However the system is still not at the desired level of stability. The Company has secured access to state-of-the-art sensors and logging tools to be supplied by two highly qualified international vendors. This is expected to save time and lower development costs. The Badger Explorer Group has through 1H 2009 managed to develop technology enabling the making of firm plugs (essential for burial). These technologies are essential for the success of the Badger Explorer tool, hence the board reiterates its optimistic view on the remainder of 2009 and the coming year. Badger Explorer ASA has retained its solid financial position, which provides grounds for a further ramp up of activities and also expanding the organisation in line with what has been previously communicated. As of 30 June 2009 the Badger Explorer Group has a net equity of MNOK 209.5, equivalent to an equity ratio of 92.1 %. Net cash position was MNOK 81.8. In addition the company holds MNOK 78.8 in bank bonds. Combined with the partner agreements with the oil majors ExxonMobil, StatoilHydro and Shell, this is considered to be sufficient to finance the company through to a commercial stage. The Badger Explorer Group (includes Calidus Engineering Ltd.) had revenues of MNOK 1.9 in 2Q 2009 and MNOK 4.4 in 1H 2009, compared with MNOK 1.5 in 2Q 2008 and MNOK 3.5 in 1H 2008. Operating expenses for 2Q 2009 amounted to MNOK 4.7 and to MNOK 9.9 for 1H 2009, compared to MNOK 5.0 for 2Q 2008 and MNOK 9.4 for 1H 2008. EBITDA for 2Q 2009 amounted to MNOK -2.8 and to MNOK -5.5 in 1H 2009, compared to MNOK -3.4 for 2Q 2008 and MNOK -5.8 for 1H 2008. The company presents its 2Q report and gives a project update, 27 August at 11:00, Hotel Continental, Oslo, and 28 August at 11:00 in the company's offices in Stavanger. For further information, please contact: Kjell Erik Drevdal, CEO, +47 916 43 552 Gunnar Dolven, CFO, +47 908 53 168 About Badger Explorer ASA Badger Explorer ASA is developing a revolutionary method for exploration and verification of oil and gas prospects, called Badger Explorer. Badger Explorer drills down and buries itself in the underground, equipped with numerous sensors, which measure and register vital formation and physical data. The method provides a substantially lower risk, cost and complex operation compared to utilising an expensive conventional drilling rig. The crushed formation cuttings are transported through the tool, deposited and compressed in the void behind the unit. Potential excess volume is injected into fractures generated by Badger Explorer. The unit is connected to a combined power and signal cable which again is connected to the surface. The unit is powered by electricity and transmits data signals to the surface through the cable. www.bxpl.com