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President Energy PLC - New Rio Negro pipeline update

RNS Number : 7671E
President Energy PLC
03 March 2020
 

 

3 March 2020

 

PRESIDENT ENERGY PLC

("President" or the "Company")

 

 New Rio Negro pipeline and infrastructure now commissioned and in operation

Gas sales from Estancia Vieja field a record high

 

President Energy (AIM: PPC), the energy company with a diverse portfolio of production and exploration assets focused primarily in Argentina announces the commissioning of its new gas pipeline and attendant infrastructure with deliveries of gas to market sharply increasing as a result.

The work now commissioned

President is pleased to announce that it has commissioned the previously announced new 16km section of gas pipeline section between its Puesto Prado and Las Bases facilities in Rio Negro province, together with the associated infrastructure which have been placed into operation thereby enabling a significantly greater volume of gas to flow through the entire length of the Company's  70km pipeline to market.

The work, completed without any incident on budget and on time, and all managed by President's own procurement, engineering, operations and regulatory teams, included the following:

•     engineering, design, permitting and procurement for all work;

•     proactively working with all landowners and interested stakeholders including all necessary transportation concessions;

•     civil works, installing compressors and dehydration units in both Angostura and Las Bases;

•     significant reconstruction work in Angostora, Las Bases and Estancia Vieja fields to meet international industry standards; 

•     project management and supervision of all construction phases including excavation and installation of the 16km pipeline, with the number of workers on site peaking at over 100;

•     extensive testing of new and existing pipelines and facilities and

•     commissioning and bringing shut in wells on line.

The aggregate cost of all the work was approximately US$5 million and is being met out of the Company's current cash flows.

 

Gas production

Current net gas production is now being ramped with gas flowing successfully to market from Estancia Vieja field at significantly greater volumes than at any time in the history of the field now the new pipeline is in operation.  

Once the ramp up has progressed to an appropriate level, expected within the next few days, a further announcement will be made in relation to aggregate volumes of gas production. President is pleased to report that current projections of the increasing gas production are in line with previously announced expectations being approximately 1,200 boepd.

As a result of the installation of a larger scale compressor, and the opening up of more shut-in wells in Estancia Vieja due in Q2 2020, it is projected that from June Group production should be boosted by a further 800 boepd. In such a scenario, this would by or around the end of H1 2020 result in some 2,000 boepd total net gas production (12 MMscft/d) from President's Neuquen basin assets thereby boosting aggregate oil and gas production net to the Company to 4,000 boepd excluding the impact of drilling results to come in Argentina during H2 2020. 

Gas prices in Argentina have not been impacted in any way by the coronavirus with President's gas being sold for domestic consumption.

Peter Levine, Chairman, commented

"The story of the first half of 2020 is all about gas.  The necessary base infrastructure in Rio Negro is now in place and it is a tribute to, and reflective of, the depth of management and employees of our Argentina operations that this has been effected safely, on time and on budget.

"President is now a much more balanced energy company from a year ago as we continue our strategy of growth both organically and by way of appropriate value enhancing acquisitions.

"We move on to planning our 2020 drilling campaign and will provide further information on this in due course."

 

Glossary:

Boepd barrels of oil equivalent (oil and gas) per day

MMscft/d million standard cubic feet of gas per day

 

 

Contact:

 

President Energy PLC

Peter Levine, Chairman

Rob Shepherd, Group FD

 

 

+44 (0) 207 016 7950

 

finnCap (Nominated Advisor)

Christopher Raggett, Scott Mathieson

+44 (0) 207 220 0500

 

Whitman Howard (Broker)

Hugh Rich, Grant Barker

 

 

+44 (0) 207 659 1234

Tavistock (Financial PR)

Nick Elwes, Simon Hudson

+44 (0) 207 920 3150

 

Notes to Editors

 

President Energy is an oil and gas company listed on the AIM market of the London Stock Exchange (PPC.L) primarily focused in Argentina, with a diverse portfolio of operated onshore producing and exploration assets.

 

The Company has operated interests in the Puesto Flores, Estancia Vieja, Puesto Prado and Las Bases Concessions, and Angostura exploration contract, all of which are situated in the Rio Negro Province in the Neuquén Basin of Argentina and in the Puesto Guardian Concession, in the Noroeste Basin in NW Argentina. Alongside this, President Energy has cash generative production assets in Louisiana, USA and further significant exploration and development opportunities through its acreage in Paraguay and Argentina.

 

The Group is also actively pursuing value accretive acquisitions of high-quality production and development assets in Argentina capable of delivering positive cash flows and shareholder returns. With a strong institutional base of support, including the IFC, part of the World Bank Group as well as the international commodity trader and logistics company Trafigura, an in-country management team as well as a Board whose interests are aligned to those of its shareholders, President Energy gives UK investors access to the Argentina energy growth story combined with world class standards of corporate governance, environmental and social responsibility.

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 London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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