GeoResources Inc., Houston, (Nasdaq: GEOI) says it had net income of $13.5 million on revenues of $94.7 million in 2008, up from $3.1 million on revenues of $40.1 million in 2007, a 335% increase.

The results include an $8.3-million non-cash impairment from oil and gas properties, resulting from lower oil and gas prices at year-end.

In the fourth quarter, GeoResources had a net loss of $4.3 million on revenues of $18.9 million, compared to profit of $2.1 million on revenues of $19.1 million during the same period in 2007. The company attributes the loss to the non-cash impairment and increased depletion and depreciation.

In 2008, oil sales increased by 90% to 743,000 barrels, from 392,000 barrels in 2007, while natural gas sales totaled 2.96 billion cubic feet, an 80% increase from the 1.65 billion cubic feet in 2007.

During the fourth quarter, GeoResources’ oil sales increased to 190,000 barrels from 176,000 barrels in the same period in 2007, an 8% increase. Natural gas sales decreased 7% to 711 million cubic feet from 766 million cubic feet. The company says production in the fourth quarter reflected the sale of a number of properties it acquired in 2007.

The company says its estimated proved reserves at Dec. 31, 2009 totaled 8.8 million barrels of oil and 34.8 billion cubic feet of gas and natural gas liquids (14.6 million barrels of oil equivalent). The reserves are approximately 60% and 40% gas.

GeoResources chief executive officer and president Frank Lodzinski says, “We have reported significant earnings and cash flows for the year ended Dec. 31, 2008. Like most in the industry, we have recognized certain impairments of oil and gas properties. However, our calculated impairments are small in relation to our peers. Another significant and favorable difference from our peers is our debt level.

“While we have never been over-leveraged, we significantly reduced our debt during 2008 from $96 million at the beginning of the year to $40 million at year end. Execution of our business strategy in 2008 has put us in a favorable position to effectively face the challenges of 2009 and hopefully, take advantage of attractive acquisition opportunities and reduced drilling costs.”

GeoResources has assets in southwest U.S., Gulf Coast and the Williston Basin.