BPI Energy Announces Fiscal First-Quarter 2008 Financial Results

BPI Energy (BPI), the operating subsidiary of BPI Energy Holdings, Inc. (Amex: BPG), an independent energy company engaged in the exploration, production and commercial sale of coalbed methane (CBM) in the Illinois Basin, today announced financial results for its fiscal first quarter ended Oct. 31, 2007.

For the opening three months of fiscal 2008, revenues from gas sales reached $318,000, compared with $294,000 for the first quarter of 2007. The increase was attributable to higher sales volume, which was partially offset by lower sales prices. The company reported a narrower net loss of $1.9 million, or $0.03 per share, compared with last year’s first-quarter net loss of $2.7 million, or $0.04 per share.

BPI President and CEO James G. Azlein commented, “While the average sales price for this fiscal year’s first three months declined compared with a year ago, revenues were up on double-digit volume increases. Net gas sales volume also sequentially rose 19 percent versus the prior three-month period.”

BPI’s parent company, BPI Energy Holdings, Inc., also announced key events of its 2007 Annual General Meeting of Shareholders held today. A total of 146 shareholders representing 45,893,840 shares, or approximately 62 percent of the total outstanding shares, were represented in person or by proxy at the meeting.

Re-elected as directors of the company were James G. Azlein, BPI president and chief executive officer, James E. Craddock, BPI chief operating officer, and four outside directors: Dennis Carlton, Joseph P. McCoy, David E. Preng and Costa Vrisakis. Shareholders also voted to ratify the appointment of Meaden & Moore, Ltd., as the company’s independent registered public accounting firm.

To be added to BPI Energy’s e-mail distribution list, please click on the link below:

http://www.clearperspectivegroup.com/clearsite/bpi/emailoptin.html

About BPI Energy

BPI Energy (BPI) is an independent energy company engaged in the exploration, production and commercial sale of coalbed methane (CBM) in the Illinois Basin, which covers approximately 60,000 square miles in Illinois, southwestern Indiana and northwestern Kentucky. The company currently controls a large CBM acreage position in the Illinois Basin at approximately 529,000 acres.

News releases and other information on the company are available on the Internet at:

http://www.bpi-energy.com

Some of the statements contained in this press release may be deemed to be forward-looking in nature, outlining future expectations or anticipated operating results or financial conditions. Such forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause actual results or conditions to differ materially from the information expressed or implied by these forward-looking statements. Some of the factors that could cause actual results or conditions to differ materially from our expectations include, but are not limited to: (a) our inability to generate sufficient income or obtain sufficient financing or draws under our advancing term credit agreement to fund our operations or future drilling plans, (b) our inability to retain our acreage rights at our projects, at the expiration of our lease agreements, due to insufficient CBM production, or for other reasons; (c) our failure to accurately forecast CBM production, (d) displacement of our CBM operations by coal-mining operations, which have superior rights in most of our acreage, (e) our failure to accurately forecast the number of wells that we can drill, (f) a decline in the prices that we receive for our CBM production, (g) our failure to accurately forecast operating and capital expenditures and capital needs due to rising costs or different drilling or production conditions in the field, (h) our inability to attract or retain qualified personnel with the requisite CBM or other experience, and (i) unexpected economic and market conditions, in the general economy or the market for natural gas. We caution readers not to place undue reliance on these forward-looking statements.

–Financial Tables Follow–

BPI Energy Holdings, Inc.

Consolidated Statements of Operations (Unaudited)

(Dollars in thousands, except per-share data)

 

Three Months Ended October 31,

 

2007

 

2006

 

 

Revenue

Gas sales

$

318

$

294

 

Operating expenses

Lease operating expense

259

336

General and administrative expense

1,884

2,735

Depreciation, depletion and amortization

 

180

 

184

 

Total operating expenses

 

2,323

 

3,255

 

Operating loss

(2,005

)

(2,961

)

Other income (expense):

Interest income

97

219

Interest expense

(2

)

(3

)

Other income (expense)

 

(26

)

 

–

 

 

69

 

216

 

Net loss

$

(1,936

)

$

(2,745

)

 

Basic and diluted net loss per share

$

(0.03

)

$

(0.04

)

 

Weighted average common shares outstanding

 

70,133,653

 

68,796,522

 

BPI Energy Holdings, Inc.

Consolidated Balance Sheets

(Dollars in thousands)

 

Oct. 31,

2007

July 31,

2007

(Unaudited)

ASSETS

Current Assets:

Cash and cash equivalents

$

4,864

$

11,292

Accounts receivable

157

94

Other current assets

 

1,133

 

 

1,348

 

Total current assets

6,154

12,734

Property and equipment, at cost:

Gas properties, full cost method of accounting:

Proved, net of accumulated depreciation, depletion, amortization and impairment of $999 and $12,621

19,866

16,631

Unproved, excluded from amortization

9,375

8,533

Support equipment, net of accumulated depreciation and amortization of $789 and $741

 

504

 

 

552

 

Net gas properties

29,745

25,716

Other property and equipment, net of accumulated depreciation and amortization of $183 and $152

 

448

 

 

473

 

Net property and equipment

30,193

26,189

Restricted cash

100

100

Other non-current assets

 

161

 

 

220

 

Total assets

$

36,608

 

$

39,243

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current Liabilities:

Accounts payable

$

710

$

1,371

Current maturities of long-term debt and notes payable

26

8,488

Accrued liabilities and other

 

726

 

 

1,503

 

Total current liabilities

1,462

11,362

Long-term debt and notes payable, less current maturities

8,827

48

Asset retirement obligation

127

114

Other long-term liabilities

 

60

 

 

–

 

Total liabilities

10,476

11,524

Shareholders’ Equity:

Common shares, no par value, authorized 200,000,000 shares, 73,618,764 and 72,524,493 issued and outstanding

67,946

67,946

Additional paid-in capital

7,957

7,608

Accumulated deficit

 

(49,771

)

 

(47,835

)

Total shareholders’ equity

 

26,132

 

 

27,719

 

Total liabilities and shareholders’ equity

$

36,608

 

$

39,243