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Hurricane Energy PLC (HUR)

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Wednesday 16 February, 2022

Hurricane Energy PLC

Operational and Financial Update

RNS Number : 7950B
Hurricane Energy PLC
16 February 2022
 

16 February 2022

 

Hurricane Energy plc

 

("Hurricane" or the "Company")

 

Operational and Financial Update

 

Hurricane Energy plc, the UK based oil and gas company, provides an update on Lancaster field operations and net free cash balances as of 31 January 2022.

 

Lancaster Field Operations Update

 

The following table details production volumes, water cut and minimum flowing bottom hole pressure for the 205/21a-6 ("P6") well during January 2022.

 

January 2022 Lancaster Field Data

 

 

P6

P7z(1)

O il produced during the month (Mbbls)

299

-

Average oil rate (bopd)

9,639

-

W ater produced during the month (Mbbls)

196

-

A verage water cut(2)

40%

-

Well gauge p ressure (psia)(3)

1,595

-

1.  The 205/21a-7z ("P7z") well was not on production during January 2022

2.  Expressed as total water produced divided by total fluid (oil and water) production

3.  Pressure reported is the monthly minimum from well downhole gauge

 

As of 14 February 2022, Lancaster was producing c.9,500 bopd from the P6 well alone with an associated water cut of c.41%.

 

The 27th cargo of Lancaster oil, totalling approximately 530 Mbbls, was lifted on 25 January 2022. This cargo was priced by reference to the average of the first five days of January's Dated Brent quotes, being $81.4/bbl. The next cargo is anticipated to be lifted in late March 2022.

 

Financial Update

 

As anticipated, and in line with previous announcements, the Regulator has now formally requested that the Company lodge additional funds as decommissioning security. The Company remains in discussions with the Regulator as to the exact amount and timing of placing of these funds into trust which are currently expected to be up to £5.7 million ($7.7 million), later in Q1 2022.  This will increase the amount of funds placed into trust, and which are therefore classified as restricted cash, from £28 million to £33.7 million.

 

During January, the Company received $3.2 million of cash rebates relating to R&D tax claims in respect of the 2019 tax year. An additional c.$1.3 million claim in respect of the 2020 tax year is still under review by HMRC but is anticipated to be received later in Q1 2022.

 

As of 31 January 2022, the Company had net free cash(4) of $85 million ($77.3 million after taking into account the above mentioned planned increase in restricted cash) compared to the last reported balance of $50 million as of 31 December 2021. $78.5 million of Convertible Bonds remain outstanding and due July 2022.

 

The Company believes that net free cash provides a useful measure of liquidity after settling all its immediate creditors and accruals and recovering amounts due and accrued from joint operation activities, outstanding amounts from crude oil sales and after settling any other financial trade payables or receivables. It should be noted that the net free cash is calculated as at the balance sheet date and does not take into account future liabilities that the Company is already committed to but have not yet been accrued. As such, not all of the net free cash would be available for repayment of the remaining outstanding Convertible Bonds at their maturity in July 2022.

 

4.  Unrestricted cash and cash equivalents, plus current financial trade and other receivables, current oil price derivatives, less current financial trade and other payables.

 

-ends-

 

Contacts: 

 

Hurricane Energy plc

Antony Maris, Chief Executive Officer

[email protected]

 

+44 (0)1483 862820

Stifel Nicolaus Europe Limited

Nominated Adviser & Joint Corporate Broker

Callum Stewart / Jason Grossman

 

+44 (0)20 7710 7600

Investec Bank plc

Joint Corporate Broker

Chris Sim / Jarrett Silver

+44 (0)20 7597 5970

 

 

Vigo Consulting

Public Relations

Patrick d'Ancona / Ben Simons

[email protected]

 

+44 (0)20 7390 0230

 

About Hurricane

 

Hurricane has a 100% interest in and operates the Lancaster field, the UK's first field to produce from a fractured basement reservoir.

 

Hurricane also has a 50% interest in the Greater Warwick Area licence, which contains the Lincoln and Warwick assets.

 

Visit Hurricane's website at www.hurricaneenergy.com

Glossary

bopd

Barrels of oil per day

Mbbls

Thousand barrels

psia

pounds per square inch absolute

Regulator

Department for Business, Energy and Industrial Strategy

 

Inside Information

 

This announcement does not contain inside information.

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