Zargon Oil & Gas Ltd. announced unaudited earnings and operating results for the second quarter and six months ended June 30, 2018. For the quarter, the company reported gross petroleum and natural gas sales of CAD 10.84 million compared to CAD 9.4 million a year ago. Funds flow from operating activities were CAD 0.58 million or CAD 0.02 per basic share compared to CAD 1.14 million or CAD 0.04 per basic share a year ago. Cash flows from operating activities were CAD 1.98 million compared to cash flows used in operating activities of CAD 0.59 million a year ago. Net loss was CAD 1.68 million or CAD 0.05 per basic share compared to CAD 1.71 million or CAD 0.06 per basic share a year ago. Field capital and administrative asset expenditures were CAD 1.19 million compared to CAD 2.09 million a year ago. Net capital expenditures were CAD 1.19 million compared to CAD 2.13 million a year ago.

For the six months, the company reported gross petroleum and natural gas sales of CAD 20.55 million compared to CAD 19.09 million a year ago. Funds flow from operating activities were CAD 0.27 million or CAD 0.01 per basic share compared to CAD 2.64 million or CAD 0.09 per basic share a year ago. Cash flows from operating activities were CAD 2.78 million compared to CAD 1.94 million a year ago. Net loss was CAD 6.02 million or CAD 0.20 per basic share compared to CAD 2.25 million or CAD 0.07 per basic share a year ago. Field capital and administrative asset expenditures were CAD 3.1 million compared to CAD 4.47 million a year ago. Net capital expenditures were CAD 2.69 million compared to CAD 4.64 million a year ago. Net debt was CAD 41.54 million as of June 30, 2018 compared to CAD 36.06 million a year ago.

Second quarter 2018 production averaged 2,118 barrels of oil equivalent per day, a 13% decrease from the preceding quarter rate of 2,427 barrels of oil equivalent per day and a 15% decline from the second quarter 2017 production rate of 2,500 barrels of oil equivalent per day. The reduction in production volumes was primarily due to the shut-in of uneconomic natural gas properties. Second quarter oil production averaged 1,805 barrels per day, a 7% decline from the preceding quarter rate of 1,949 barrels per day.

For the six months, the company reported average daily production of 2,272 boe/d compared to 2,540 boe/d a year ago.