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President Energy PLC (PPC)

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Wednesday 09 January, 2019

President Energy PLC

Net Group year-end production target beaten

RNS Number : 5521M
President Energy PLC
09 January 2019
 

 

9 January 2019

 

PRESIDENT ENERGY PLC

("President", "the Company" or "the Group")

 

President beats year-end 2018 net Group production target of 3,000 boepd

 Group production increases over 50% year on year*

Third new well at Puesto Flores field successfully tested and placed on production

Expected significant increase in 1P Proven reserves at the Company's Rio Negro assets in upcoming audit

Investor Conference call to be held today at 10.30am

 

President Energy (AIM: PPC), the upstream oil and gas company with a diverse portfolio of production and exploration assets focused primarily in Argentina, provides an update relating to Group net production as well as its Concessions in the Rio Negro Province, Argentina (President 90% and operator - Edhipsa 10%).

 

Group production

 

President is pleased to announce that it has beaten its 3,000 boepd target for net Group production exit year end 2018.

 

The Company is producing at a net Group level of approximately 3,300 boepd.  This represents an increase of over 50% year on year* and is being achieved without the benefit of any contribution from the Las Bases Concession and with only a limited contribution from the Puesto Prado and Estancia Vieja fields, all in Rio Negro Province, Argentina.  Commercial gas sales from the Las Bases and Estancia Vieja Concessions are expected to commence by the end of Q1 2019.

 

Production in the Puesto Guardian field in Salta Province remains stable as does production from President's interests in Louisiana, USA.

 

Well PF0 1005

 

This well has now been successfully tested and placed on production with initial levels of approximately 250 bopd, being in excess of expectations. Both the Punta Rosada and the Lotena formations are producing on a co-mingled basis.

 

Management expect that the next Reserves Audit, due to be published in March 2019, will show a significant increase in 1P Proven reserves at the Company's Rio Negro Concessions due to the successful drilling and workover campaigns delivered in 2018.  

 

This latest result means the three well drilling programme has met with 100% success. All wells are now producing and were delivered on time and budget.  Management are now monitoring overall field performance in line with good reservoir management practice with the objective of maximising monthly average production and minimising downtimes.

 

Projected operational activity in Q1 2019

 

Operational work in the first quarter of 2019 will include, but will not be limited to:

1.   Preparation and planning of the next drilling campaign in Argentina due to commence in Q2 ramping up into H2 as well as long lead planning for 2019 exploration in Paraguay;

2.   Workover campaigns in Rio Negro to bring on new production from currently shut-in wells in the Puesto Prado and Estancia Vieja fields, further enhancing economies of scale;

3.   Commencement of added value commercial gas production and pipeline sales from existing shut-in wells at the Las Bases and Estancia Vieja fields as President seeks to have a greater revenue contribution from gas production;

4.   Electrification of the Rio Negro fields using President's own gas from Estancia Vieja making substantial operational savings and avoiding costly power outages from the grid;

5.   Installation of a dual fuel power system in the Dos Puntitas field, Puesto Guardian Concession in Salta Province, Argentina using President's own generated gas reducing reliance on diesel;

6.   Preparations and planning for a four well drilling programme to commence in early Q2 2019 at Jefferson Island, Louisiana; and

7.   Continued focus on costs and margins benefiting from increasing efficiencies through sensible investment and greater economies of scale generated by significant production growth.

 

Peter Levine, Chairman and Group CEO commented:

 

"Our objectives for 2018 were successfully delivered, and are history now. The strategy for 2019 is to take everything we achieved and build on it to deliver another year of dynamic growth and profitability both organically and by acquisition.

 

"The expected significant increase in Proven reserves from our Rio Negro assets underlines the material improvement in shareholder value achieved last year. Whilst President's 2P Proven and Probable reserves and extensive resources are important to demonstrate future potential, the essential core value of our business is reflected by proven hydrocarbon reserves particularly with greater emphasis from the higher value added Rio Negro fields.

 

"President continues to maintain a 360 degree focus on every aspect of the business from new production, reserves and reservoir management to the crucial aspects of cash management and control of G&A costs and expenses.

 

"We look forward to delivering and escalating shareholder value in 2019."

 

Conference call

 

The Company will be hosting a conference call, focussing on today's Operational Update, for Investors at 10.30 am (UK Time) today.  The dial in details are shown below and participants should ask for the "President Energy Investor Call".

 

United Kingdom Toll-Free:

Dial in number: 08003589473

Conference code: 16678015#

United Kingdom Toll:

Dial in number: +44 3333000804

Conference code: 16678015#

 

 

Victor Linari, Master in Geology and Member of the Society of Exploration Geophysicists, who meets the criteria for qualified persons under the AIM guidance note for mining and gas companies, has reviewed and approved the technical information contained in this announcement.

 

Glossary

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

* Start of new year 2018 compared to same time in 2019

 

Contact:

 

President Energy PLC

Peter Levine, Chairman, Chief Executive

Rob Shepherd, Group FD

 

 

+44 (0) 207 016 7950

 

finnCap (Nominated Advisor & Joint Broker)

Christopher Raggett, Scott Mathieson

 

+44 (0) 207 220 0573

 

Panmure Gordon (Joint Broker)


Charles Lesser, Dominic Morley

+44 (0) 207 886 2500

 

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 as at 31 December 2017 has independently assessed 1P reserves in excess of 15 MMboe and 2P reserves of more than 27 MMboe.

 

The Company has operated interests in the Puesto Flores, Estancia Vieja, Puesto Prado and Las Bases Concessions, Rio Negro Province as well as 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, an in-country management team as well as a Board whose interests are aligned to those of its shareholders, President Energy gives UK investors rare access to the Argentinian 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


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