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UPDA Board of Directors Reports To Its Shareholders
JUNO BEACH, Fla.--(BUSINESS WIRE)--April 17, 2006--Now that we have filed our annual financial statement and SEC Form 10K-SB, the UPDA Board of Directors, in our continuing effort to be transparent with our shareholders and the public, is pleased to summarize our financial results, report on the state of our subsidiaries and provide insight on our business and the future of our company.
As you may recall, UPDA took its present form as a result of an upstream merger completed in June 2005. A new board and management team was appointed at that time, and a new business plan adopted. Since that date, UPDA has entered five oil and gas joint ventures - Canyon Creek Oil and Gas, Inc., Texas Energy Inc., UPDA Petroleum Trading, Inc., West Oil and Gas, Inc. and WinRock Energy, Inc.
This new board and management team and the new business model have generated financial results that are clear evidence of our commitment to build shareholders\' value. Despite having control for less than eight of the twelve months of 2005, current management was able to grow the assets of the company from $308,000 to over $3,071,000. At the same time, liabilities were decreased by one-third, from $975,000 to $650,000 and the loss per share narrowed from $16.94 to $0.86.
Shareholders\' equity is in the black in 2005 - from a prior deficit of $666,500 to a surplus of $1.8 million - and - for the first time - in 2005, the company reported real revenue from actual operations.
Although we are proud of our efforts, the UPDA board and management is not satisfied. In 2005, we gained valuable experience, established significant relationships and built a solid basis from which we can continue our growth. In 2006, we expect to expand on that base, utilize our relationships and experience and position UPDA for consistent profitability.
As a result of the continuous refinement of our business model, we will achieve our goals through the following established and many other, yet to be created, subsidiaries:
Canyon Creek (CCOG) was formed in July 2005 with three properties in north Texas. As a result funding provided by UPDA, CCOG started production in October 2005 and its portfolio of properties grew from three to seven oil and gas fields. Although there have been limited disappointments, CCOG is now producing, or able to produce, from four of its seven properties. Work continues and we expect CCOG will continue to increase its oil and gas production in the coming weeks and months.
CCOG recently executed a Letter of Intent with Avalon Oil and Gas, Inc. (OTCBB:AOGS) for the sale of a 50% working interest in CCOG\'s Starr County field. For this 50% interest, AOGS has agreed to pay CCOG $75,000 cash and 7.5 Million shares of Avalon common stock (Total value - $750,000). CCOG had originally acquired its 100% working interest in this field for the total sum of $94,000. Although UPDA generally intends to retain all of the properties it acquires, it is apparent from these numbers that this offer could not be ignored.
As for the Inez lease, which must be considered a setback to date, sand was encountered in the B pay zone creating production complications that were insurmountable. We are presently formulating a plan to produce the well from the Yegua A Zone and remain optimistic that this well will generate revenues commensurate with our investment.
Texas Energy Inc. was formed in March 2006 with three properties. As a result of UPDA investments, two of the three fields are partially producing and work over is ongoing.
More significantly, Texas Energy will be reporting the details of another major acquisition shortly.
UPDA Petroleum Trading, Inc. was established in March 2006. While this company is capable of generating income from trading crude, condensate and refined product, the importance of a trading company is to mitigate the risk of fluctuating oil and gas prices. Through this subsidiary, we will balance our ability to deliver product, establish a vertical presence in the industry and exploit a unique international opportunity. Later in the week, UPDA will be reporting additional progress on the organization of this subsidiary.
Although they have encountered unfortunate obstacles to success, we continue to work with our partners in West Oil and Gas Inc. and WinRock Energy, Inc. to commence the business of these two subsidiaries.
The first order of business this year is our intention to add two more units - UPDA Oil Services Company - to perform and manage in-house all of our well workovers, drilling programs and scheduled maintenance - and UPDA Pipelines and Gathering Systems - to exploit the extensive network of gathering systems and pipelines we are acquiring, maximize the return on our investment in those pipelines and gathering systems and generate additional revenues for the company.
In 2006, the Board and the management of UPDA intend to continue aggressive expansion consistent with our established business model. We intend to grow each subsidiary generically and to expand UPDA by adding more subsidiaries. We will continue to surround ourselves with respected oil and gas professionals and to pursue each new source of opportunity. As important, we will continue to establish and refine cost reducing financial controls on our operations and to fine tune our business model and business relationship structures in order to achieve success and build value for our shareholders.
As we look back at our first eight months of operation, we are proud of our financial results, the progress of our business and of our many achievements. As we look into the future, we are confident that UPDA is well positioned to enter its next phase of expansion and to face the challenges of the future.
We take this opportunity to thank our shareholders for your continued support.
UPDA Board and Management
Statements contained in this press release that are not based upon current or historical fact are forward-looking in nature. Such forward-looking statements reflect the current views of management with respect to future events and are subject to certain risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected, or described pursuant to similar expressions.
CONTACT: Universal Property Development and Acquisition
Corporation
Investor Relations:
Bradford Moore, 561-630-2977
info@updac.com
SOURCE: Universal Property Development and Acquisition Corporation |
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