HOUSTON, Nov. 14 /PRNewswire-FirstCall/ -- ISRAMCO, INC. (Nasdaq: ISRL) reported today that third quarter 2008 revenues were $17,866,000, compared to $5,355,000 in the third quarter of 2007, an increase of approximately 234%. Major components of revenues in the third quarter of 2008 were oil and gas sales of $17,855,000 compared to $5,877 in the third quarter of 2007. Revenues for the nine months ended September 30, 2008 were $44,469,000 compared to $15,692,000 during the comparable period in 2007.

The increase in oil and gas revenues is mainly attributable to the oil and gas properties that the Company purchased from GFB Acquisition - I, L.P. ("GFB") and Trans Republic Resources, Ltd. on March 27, 2008 and from Five States Energy Company, L.L.C. on March 2, 2007, and the increase in oil and gas prices. These increases were partially offset by the natural decline in production from our older oil and gas properties.

The Company reported a net income of $34,488,000 or $12.69 per share for the third quarter of 2008 compared to net loss of $647,000 or ($0.24) per share for the same period in 2007. The increase in the net income recorded during the three months ended September 30, 2008 as compared to the net loss recorded for the same period in 2007 is primarily attributable to an aggregate $53,336,000 increase in gain on swap transactions as well as the increase in operating income. This increase was partially offset by an $18,439,000 increase in interest expenses and an income tax benefit.

The Company reported a net loss of $5,346,000 or ($1.97) per share for the nine months ended September 30, 2008, compared to net loss of $1,215,000 or ($0.45) per share for the comparable nine month period in 2007. The increase in the loss recorded during the nine months ended September 30, 2008, as compared to the net loss recorded for the same period in 2007, is primarily attributable to an aggregate $17,220,000 increase in loss on swap transactions as well as the increase in interest expense. This was partially offset by a $15,007,000 increase in operating income and an income tax benefit.

The Company uses oil and gas swaps to hedge its future production. However, the Company does not apply hedge accounting. As a result, all the changes in the mark-to-market value of the derivatives per SFAS 133 are reflected as unrealized gain or loss in the statements of operations. Due to the increase in oil prices, the Company recorded a loss on derivative (hedging) contracts of $17,917,000 for the nine months ended September 30, 2008.

There are currently 2,717,691 shares of Common Stock issued and outstanding.

Isramco's unaudited quarterly results are summarized below (in thousands except for shares outstanding and per share amounts):





                           For the Three Months      For the Nine Months
                            Ended September 30,       Ended September 30,
                             2008         2007         2008         2007
    STATEMENT OF OPERATIONS
     DATA

    Revenues               $17,866       $5,355      $44,469      $15,692

    Total operating
     expenses               13,590        4,969       27,760       12,041

    Operating income         4,276          386       16,709        3,651

    Net income (loss)       34,488         (647)      (5,346)      (1,215)

    Net income (loss)
     per common share        12.69        (0.24)       (1.97)       (0.45)

    CASH FLOW DATA

    Net cash provided by
     (used by) operating
     activities                                       12,614         (178)

    Net cash used in
     investing activities                            (98,988)     (65,587)

    Net cash provided by
     financing activities                             91,377       67,264



                                                  September 30, December 31,
                                                       2008         2007
    BALANCE SHEET DATA

    Current assets                                   $21,756      $11,103

    Total assets                                     214,347      110,708

    Current liabilities                               37,630       11,273

    Long - term liabilities                          158,909       73,964

    Total shareholders' equity                        17,808       25,471

FORWARD-LOOKING STATEMENTS

ALL STATEMENTS CONTAINED HEREIN, AS WELL AS ORAL STATEMENTS THAT MAY BE MADE BY THE COMPANY OR BY OFFICERS, DIRECTORS OR EMPLOYEES OF THE COMPANY ACTING ON THE COMPANY'S BEHALF, THAT ARE NOT STATEMENTS OF HISTORICAL FACT, CONSTITUTE "FORWARD-LOOKING STATEMENTS" AND ARE MADE PURSUANT TO THE SAFE- HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT COULD CAUSE THE ACTUAL RESULTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM THE HISTORICAL RESULTS OR FROM ANY FUTURE RESULTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. SUCH RISKS AND UNCERTAINTIES ARE OUTLINED IN THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR 2007, ITS QUARTERLY REPORTS ON FORM-10-Q, AND SUCH OTHER DOCUMENTS AS ARE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FROM TIME TO TIME. THE COMPANY IS NOT OBLIGATED TO REVISE OR UPDATE ANY FORWARD-LOOKING STATEMENTS IN ORDER TO REFLECT EVENTS OR CIRCUMSTANCES THAT MAY ARISE AFTER THE DATE OF THIS RELEASE.

SOURCE ISRAMCO, INC.