President Energy PLC - Trading update
("President", "the Company" or "the Group")
· Three well development drilling programme at Puesto Flores field confirmed to start by end September funded out of cash flow
· The wells target proven undeveloped reserves aimed at increasing gross Puesto Flores field oil production by a minimum of 600 additional bopd in aggregate
· Further development wells at Puesto Flores/Estancia Vieja expected in 2019 together with two exploration wells
· These complement 2019 development drilling in Puesto Guardian,
· President's current normalised net production across all areas is approximately 2,700 boepd of which 95% is oil with the balance being gas in
· Group free positive cash flow generation from operations now running in excess of
· H1 2018 results are anticipated to show a strong financial position with record high production in June
· The second half of the year expected to see further material improvement on the first six months
President can now confirm that the previously indicated new three development well drilling programme at the Puesto Flores field will commence by the end of September with the rig contracted, long lead items ordered, approvals, consents and permits obtained, and specialist sub-contractors being chosen. The cost of the wells will be paid out of cash flow.
The wells all target proven undeveloped reserves, are designated in planned order of drilling PFO 1001, PFE 1001 and PFO 1005 and are aimed at increasing gross field production by 600 bopd in aggregate on the base case. Each well is planned to be vertical with a depth of between 2,300 and 2,700 meters. Once drilled, the wells will be completed with a workover rig. It is expected the wells will deliver a rapid payback and it is currently projected that all three wells should be completed and on stream by the end of this year.
President has already received nine drilling permits for locations in Puesto Flores and it is expected that new development wells together with two exploration wells will be drilled at that Concession in 2019. The work next year will be complemented by new development drilling in Puesto Guardian,
President's current normalized net production is approximately 2,700 boepd of which some 95% is oil with the balance being from the gas contribution coming from
As referred to above it is anticipated that by the end of the year net production will be enhanced by oil from the new wells to be drilled at Puesto Flores.
In addition to the above, the currently shut in gas production capability of certain wells in the Estancia Vieja field would further add in excess of 500 boepd additional initial production if/when placed on line. Testing of certain wells there is still in progress. As previously announced President is working on ways to utilise such gas internally and to monetise any excess by early 2019. A progress report will be issued later this year.
The record level of production currently provides President with free positive cash generation from operations in excess of
The expected production from the new wells will further increase this cash generation.
Half year accounts
Whilst the interim accounts for H1 2018 are still in preparation with an estimated publication date of late September, they are anticipated to show a company in a strong and ever improving financial position. Furthermore, indications are that the second half of the year will see continued material progress as turnover grows and margins remain robust.
"With production and cash generation at record levels and the capability to further expand organically, we now move to the drilling programme with all at President focused on delivering continued operational success and profits.
At the same time, we continue to explore opportunities for growth by acquisition.
In all of this, as we rightly concentrate on profits, margins and cash, it is easy to neglect the fact that President also has significant exploration prospects in the north of
Finally, I continue to be most grateful to all of our employees, partners and provincial authorities who, by their understanding and support are helping us deliver these good results.
The Board looks to the future with considerable confidence."
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Bopd-barrels of oil per day
Boepd-barrels of oil equivalent per day (oil, gas and condensate)
Notes to Editors
The Company has operated interests in the Puesto Flores and Estancia Vieja Concession,
This announcement contains inside information for the purposes of article 7 of Regulation 596/2014.
This information is provided by RNS, the news service of the
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