(RTTNews) - Canadian oil and gas exploration company Painted Pony Petroleum Ltd. (PPY.A.V, PPY.B.V) Thursday reported a loss for the third quarter, but an increase in revenues.

Net loss for the quarter was C$2.05 million or C$0.05 per share, compared to net income of C$328 thousand or C$0.01 per share in the same quarter last year. Funds flow from operations declined to C$4.51 million or C$0.12 per share from C$4.85 million or C$0.16 per share in the year-ago quarter.

Petroleum and natural gas revenues, before royalties, were C$7.83 million, up from C$7.19 million in the prior-year quarter.

Total daily sales volumes increased to 1,655 boe/d from 925 boe/d in the comparable quarter. Realized prices for oil was C$71.18 per barrel, much lower than C$118.34 per barrel in the previous year. Realized prices for gas declined to C$3.20 per thousand cubic feet from C$8.11 per thousand cubic feet in the previous year.

Capital expenditures increased to C$26.63 million from C$17.0 million in the yea-ago quarter.

At the end of the quarter, Painted Pony had an inventory of 153,997 net acres of land, including 59,843 net acres in Saskatchewan and 94,154 net acres in British Columbia. During the fourth quarter, the company participated in a British Columbia land sale, bringing total lands in the province to 98,400 net acres as at November 1, 2009. Painted Pony has over 68,500 net acres with Montney/ Doig rights.

For the nine-month period, net loss was C$5.61 million or C$0.17 per share, compared to a net income of C$5.20 million or C$0.20 per share last year. Funds flow from operations were C$8.23 million or C$0.25 per share, lower than C$9.87 million or C$0.38 per share last year.
Year-to-date, Petroleum and natural gas revenues, before royalties, increased to C$17.28 million from C$14.98 million in the prior year.

Painted Pony expects to continue to generate solid operating and financial results through successful drilling, complemented by a strong financial position and healthy oil prices. During the balance of this year and in 2010, the company intends to expand its Bakken exploration and development program and commence the exploratory evaluation of its Montney and Buckinghorse shale gas resource plays.

About 75% of the expected drilling, completion and equipping costs in 2010 are targeted for light oil operations. Painted Pony's budget anticipates 2010 capital expenditures of approximately C$90 million.

Painted Pony also announced the appointment of Michael Belenkie as vice president, corporate development. Belenkie has been serving as manager of corporate development since he joined Painted Pony in September 2008. Prior to that, he held numerous positions with a major oil and gas company, lastly as Montney Development Lead.

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