President Energy PLC - Operational Update
PRESIDENT ENERGY PLC
("President" or the "Company")
President Energy (AIM: PPC), the energy company with a diverse portfolio of production and exploration assets focused primarily in
• New treatment plant to be built in
• Will eliminate third party treatment costs with total savings estimated at
• Of the
New treatment plant
Currently President's battery in its Puesto Flores/Estancia Vieja Concession,
President has now sanctioned a project to eliminate such third party costs by engineering a new plant with the capacity to treat all the Company's oil to sales specification. The solution also will provide President with the capacity to transport its oil either through pipelines or by truck.
The plant has been designed by President's in-house engineering team who will also supervise its construction.
The aggregate savings of opex including shrinkage, quality discount and transport fees are estimated to be approximately
Funding of plant
The project is being funded by a new
This type of loan has been propounded by the Argentine Government to stimulate growth and investment. Taking into account those projected depreciation rates and the fact that President is paid in pesos at the dollar equivalent at the time of payment (not invoice) for its oil and gas, it is considered that the loan is likely, in the absence of unforeseen circumstances, to have an effective zero or negative rate of interest.
As the Company has in H2 2020 repaid
Negotiations with a substantial and reputable National Oil Company in relation to a farm out of the Pirity Concession,
President's principal focus has been on a contribution to well costs and finding a partner with sympathetic aims and ambitions. Inter alia under the terms of the deal under discussion, President will remain operator and retain a 50% interest in the relevant Concession.
As stated in previous announcements, although there can be no guarantee of a successful conclusion of negotiations, with every tick in the box the prospects of a positive outcome come ever closer. With that caveat, there has been material progress recently leading to the view that on current evidence there is a better than a 50% chance of a mutually satisfactory conclusion to the discussions. It is hoped to conclude matters before the end of Q1 2021 with a view to drilling an exploration well targeting a location in the Delray complex within approximately 12 months.
By way of reminder the Delray complex is estimated by President to have a mid case of 230 Million barrels of unrisked oil resources in place. The complex is unrelated to the two structures targeted in the previous exploration campaign and has as its analogue proven producing oil fields on the same trend located over the border in
"The new plant will materially reduce opex and produce improved cash flow and bottom line profits
"The benefits are enhanced by the funding terms which are projected to have a zero or even negative interest rate thanks to the Government's initiative for which President is appreciative. President is likewise grateful to the Province of
"The funding underlines the debt capacity and good credit standing of President and the project demonstrates the commitment of the Company to constantly find ways to improve its margins and profits
Boepd barrels of oil equivalent (oil and gas) per day
MMscft/d million standard cubic feet of gas per day
Oil in place means the total oil content of a reservoir
President Energy PLC
+44 (0) 207 016 7950
finnCap (Nominated Advisor)
+44 (0) 207 220 0500
Shore Capital (Corporate Broker)
+44 (0) 207 408 4090
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
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
The Group is also actively pursuing value accretive acquisitions of high-quality production and development assets capable of delivering positive cash flows and shareholder returns. With a strong strategic and institutional base of support, including the international commodity trader and logistics company Trafigura, an in-country management team as well as the Chairman whose interests as the largest shareholder are aligned to those of its shareholders, President Energy gives
This announcement contains inside information for the purposes of article 7 of Regulation 596/2014
Quick facts: President Energy PLC
Market Cap: -
NO INVESTMENT ADVICE
The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...FOR OUR FULL DISCLAIMER CLICK HERE