HOUSTON, May 21 /PRNewswire/ -- Esenjay Exploration, Inc. (Nasdaq: ESNJ) ("Esenjay") announced today first quarter 1999 financial results and its first quarter 1999 exploratory drilling results. The Company reported a net loss of $4,081,478 for the quarter. Cash flow from operating activities for the quarter, before changes in working capital, was a deficit of $586,850. The Company also announced it has participated in the drilling of eight exploratory wells to date in 1999. Five of the wells have been discovery wells, one was a dry hole, and two wells are currently drilling. Esenjay Exploration, Inc. utilizes a successful effort methods of accounting. As a result, included in expenses in the first quarter of 1999 were non-cash charges at $745,458 of geological and geophysical costs primarily related to the acquisition of additional 3D seismic data, and $2,383,000 in amortization of unproven properties. The Company has previously announced its policy to amortize, for book value purposes, $54,200,000 in unproven non-producing projects it acquired in May of 1998 over up to a forty-eight month amortization period. The amortization varies by property as each individual property is evaluated and the net book value moves to proven oil and gas properties or is fully expensed or impaired as future results may warrant. The amortization of the book value is a non-cash accounting amortization and is not indicative of the fair market value of the projects at any point in time. The Company has also announced that it expects the accounting methodology to continue to have a significant effect on reported earnings through the year 2001 -- a period during which it anticipates continued rapid growth in both its proven oil and gas reserves and its net cash flow from operations. Recapped below is a summary of the Company's 1999 exploration discoveries to date. These discoveries are as follows: -- M-Half Circle Ranch: This 13,615 foot well was drilled and completed in the Oligocene formation where it tested at a flowing rate of 8.6 MMCFG per day and 534 BC (barrels of condensate) per day with flowing tubing pressure of 8,960 p.s.i. through a 14/64" choke. The well has just recently commenced production and is flowing at the rate of 8.3 MMCFG per day and 508 BC per day. The operator intends to increase production. The operator is currently monitoring the well and intends to increase the rate of production. Esenjay owns a 25% working interest in the well. -- David C. Holland et al No. 1: This 9,491 foot well was completed in the Hackberry formation. It was tested at a flowing rate of 10.9 MMCFG per day and 937 BC per day with flowing tubing pressure of 6,142 p.s.i. through a 20/64" choke. Esenjay, the operator of the well, owns a 33.33% working interest in the well. Production is expected to commence in June 1999. -- J. T. Clubb #1 This 8,600 foot well was drilled and completed in the Hackberry formation. It was tested at a flowing rate of 377 BO (barrels of oil) per day and 1.125 MMCFG per day with flowing tubing pressure of 2,510 p.s.i. through a 11/64" choke. Esenjay owns a 7.67% working interest. The well commenced production on April 29, 1999 and is flowing at the rate of 2.2 MMCFG per day and 237 BO per day. -- Boyt #1 This 10,000 foot well was drilled and completed in the Nodosaria Sand formation. It was tested at a flowing rate of 2.983 MMCFG per day and 96 BO per day with flowing tubing pressure of 2,921 p.s.i. through a 14/64" choke. Esenjay owns a 7.67% working interest. The well commenced production on May 10, 1999 and is flowing at the rate of 4.2 MMCFG per day and 111 BO per day. -- Esenjay has drilled a fifth discovery well in 1999 and owns a 33.33% working interest. Esenjay will release results of this well at a later date. Esenjay Exploration, Inc. is an independent energy company engaged in the exploration for and the development of natural gas and oil. It has an inventory of 39 technology enhanced natural gas exploration projects along the Texas and Louisiana onshore gulf coast. Its focus is on generating and enhancing these projects with computerized exploration technologies and utilizing 3D seismic data prior to drilling. (Cautionary Statement Regarding Forward-Looking Information) Certain statements contained herein that set forth management's intentions, plans, beliefs, expectations or predictions of the future are forward-looking statements. In all cases Esenjay's actual results could differ materially from those projected in any forward-looking statements. The risks and uncertainties include, but are not limited to, potential unfavorable or uncertain results of completion operations, operational uncertainties, risks associated with quantities of total reserves and rates of production from new gas and oil reserves and pricing assumptions regarding said reserves, potential delays in the timing of planned operations, potential cost overruns, regulatory uncertainties, as well as general industry and market conditions. Additional information concerning factors that could cause actual results to vary materially is contained in Esenjay's periodic filings with the U.S. Securities and Exchange Commission ("SEC"), all of which may be obtained by contacting Esenjay or the SEC. ESENJAY EXPLORATION, INC. Financial Data Three Months Ended March 31, 1999 1998 Operating Data: Revenues: Gas and oil revenues 964,245 48,503 Gain on sale of assets 190,849 (98,886) Operating fees 63,734 6,992 Other revenues 292,174 26,805 1,511,002 (16,586) Total revenues Costs and expenses: Lease operating expense and production taxes 317,764 69,322 Depletion, depreciation and amortization 619,000 53,568 Additional depreciation, depreciation and amortization 2,383,000 --- Impairment of gas and oil properties --- 60 General and administrative 1,403,972 459,014 Exploration costs -- dry hole --- 3,500 Exploration costs -- geological and geophysical 745,458 (12,685) Interest Expense 123,286 19,223 Other --- --- Total costs and expenses 5,592,480 592,002 Income (loss) before provision for income (4,081,478) (608,588) Benefit (provision) for income taxes -- deferred --- --- Net income (loss) (4,081,478) (608,588) Net income (loss) per common and common equivalent share (0.26) (0.38) Balance Sheet Data: Current Assets $ 7,190,601 Total Assets 61,754,697 Current Liabilities 16,645,193 Long-term debt (net of current maturities) 12,640,000 Stockholders equity 31,241,110  