Tórshavn, Faroe Islands, 2013-08-28 11:24 CEST (GLOBE NEWSWIRE) -- P/F Atlantic Petroleum (OMX: FO-ATLA) today announces its results for the first six months of 2013. This company announcement should be read in conjunction with Atlantic Petroleum’s Condensed Consolidated Interim Report attached to this announcement.
Ben Arabo, Atlantic Petroleum’s CEO, stated:
“Production in the first half of 2013 has been in line with the 2013 guidance. The Chestnut fields’ performance continues to exceed expectation. Studies are currently underway to fully evaluate the potential impact of the good performance. My expectations are that these will lead to an extension of field life and increased reserves. Our production is also expected to increase with the addition of another Ettrick production well later this year. The Orlando development is progressing and first oil is expected in 2015. The next project planned for sanction is Kells which will add significant reserves to Atlantic Petroleum when sanctioned.
The current projects will form the base of our production beyond 2015 but we are still looking for additional opportunities to add to our development and production portfolio in the short to mid- term.
With regards to exploration the Dunquin well is still being evaluated. The well has confirmed a working hydrocarbon system in the Irish Porcupine basin and we are now looking at the implications for the remaining prospectivity on our acreage in the area. A big step forward for Atlantic Petroleum with regards to exploration was the 22 nd round awards in Norway. Norway will play an important role in the future exploration strategy of Atlantic Petroleum and we are looking at ways to accelerate our activities in Norway.
We are disappointed with having to relinquish Polecat, but with a portfolio of 40 licences and many opportunities available in the market we face the future with confidence in the ability to furnish our pipeline with a string of good projects in the years to come. We now turn our attention to the Pegasus appraisal well which is expected to be the next well in our programme The Pegasus area has the potential to add significant reserves to our portfolio.”
Highlights
- Revenue in 1H 2013 DKK 214.2MM (1H 2012 DKK 279.4MM). Average realised oil price per barrel was USD 108.5 per boe
- EBIT 1H 2013 DKK -21.8MM (1H 2012 DKK 77.2MM)
- EBITDAX 1H 2013 DKK 120.7MM (1H 2012 DKK 203.5MM)
- General and administration costs 1H 2013 DKK 32.0MM (1H 2012 DKK 17.3MM) increase reflects the new office in Bergen on a pre-tax basis. Norway tax refund is 78%
- Finance gain 1H 2013 DKK 13.1MM (1H 2012 DKK 1.1MM) increase is due to exchange rate gains in USD/GBP
- Cash generated from operations in the first six months in 2013 was DKK 84.5MM (1H 2012 DKK 173.6MM)
- Cash and cash equivalents at end 1H 2013 was DKK 59.2MM (end 2012 DKK 242.5MM) decrease reflects acquisition of significant development assets
- Production in 1H 2013 amounted to 374,000 boe corresponding to an average of 2,066 boepd net to the Group
- The Chestnut field produced at stable rates at the high end of expectation. A reserve upgrade was taken in the end of year CPR report
- Production from the Ettrick field was relatively stable towards the higher end of expectation
- Blackbird field production has been stable throughout the first half of 2013. The water injector drilled in late 2012 was commissioned and injection commenced in January
- The Orlando field development has been approved by partners and subsequently been sanctioned by DECC (17 th April 2013). Orlando development continues following a thorough review of the project and dialogue with the operator the schedule is to have first oil in 2015 with expected initial production rates of 10,000+ boe gross
- In the 22 nd Norwegian licensing round Atlantic Petroleum was successful acquiring two new licences. The licenses PL704 and PL705 both contain multiple high potential prospects that have been de-risked prior to application, and given a discovery the reserves can be tied in to the Aasta Hansteen Field.
- The UK P1766 Magnolia prospect was drilled in 1Q. The well did not encounter hydrocarbons and was plugged & abandoned
- The UK P1100 Polecat licence will expire in September 2013 and will be relinquished. The amount capitalised on the licence DKK 37.6MM was expensed during the period as unsuccessful exploration cost
- Atlantic Petroleum completed the acquisition of a 4% interest in the Irish Continental Shelf Frontier exploration licence FEL 3/04 from ExxonMobil where the Dunquin well was being drilled. Dunquin North was still drilling at the end of 1H 2013. The well was plugged and abandoned as per the pre-drill plan on 30 th July 2013. The well penetrated around 249m of the massive carbonate Cretaceous target within prognosis and was drilled to a total depth of 5000m. Petrophysical analysis of the well logs indicates an upper zone of 44m which has residual hydrocarbon saturations in a porous reservoir
2013 Outlook
- Production for the year is expected to be in the current guidance range of 725,000 – 800,000 boe
- EBITDAX for the year is expected to be in the guidance range of DKK 225MM – DKK 275MM
- The Chestnut fields’ performance continues to exceed expectation. Studies are currently underway to fully evaluate the potential impact of the good performance. Atlantic Petroleum´s expectations are that these will lead to an extension of field life and increased reserves
- The Ettrick E9 infill production well spudded in 2Q 2013 is expected to come on-stream imminently after the annual Aoka Mizu shut-down in 3Q 2013
- The Blackbird operator is evaluating the benefits of drilling a 2 nd production well to increase production and extend field life of the Ettrick and Blackbird fields
- Development of the Orlando field continues with first oil expected in 2015. The field will add significant production to Atlantic Petroleum
- The Kells FDP has been agreed and is being held by DECC pending final submission in 2014. First oil is expected in 2016 When sanctioned, the Kells development will add significant reserves to Atlantic Petroleum
- Following the recent success with awards in the 22 nd licensing round in Norway Atlantic Petroleum plans to participate in the upcoming APA round closing in September 2013
- The UK Pegasus West appraisal well will be drilled in 4Q 2013 or 1Q 2014
- Planning continues for a Perth field appraisal/ development well. The well will spud in late 2013 or early 2014 dependent on rig availability
- Dunquin well post well studies will be carried out to ascertain the impact of the oil shows and the proven working hydrocarbon system on other prospects in the area
- Over the next 12 months Atlantic Petroleum has hedged on average 23% of expected oil production at an average oil price of USD 104.82/bbl
Conference call
In connection with the publication of the 1H 2013 Condensed Consolidated Interim Report Atlantic Petroleum will host a webcast/conference call for analysts and investors
The webcast/conference call will take place on Wednesday 28 th August 2013 at the local time stated below:
Copenhagen 12:00 noon
London 11:00 AM
Tórshavn 11:00 AM
Reykjavik 11:00 AM
For investors and analysts wishing to ask the Group representative questions the call-in details are as follows:
DK: +45 70265040 or UK: +44 2088179301
More details about the conference call can be found on the Company’s website www.petroleum.fo .
Further Details:
Further details can be obtained from Ben Arabo, CEO, tel +298 350100 (ben.arabo@petroleum.fo). This announcement will be available, together with other information about Atlantic Petroleum, on the Company's website: www.petroleum.fo .
On the website, it is also possible to sign up for the Company’s e-mail newsletter.
Announcement no. 35/2013
Issued 28-08-2013
P/F Atlantic Petroleum Yviri við Strond 4, 3rd floor P.O. Box 1228 FO-110 Tórshavn Faroe Islands Telephone +298 350 100 Fax +298 350 101 Website: www.petroleum.fo E-mail: petroleum@petroleum.fo
