Another company selling Trinidad oil reports getting higher price for it
Tuesday, September 26 2017 @ 11:59 PM AST
Contributed by: DeoBhagan
The first was EOG Resources as reported here: http://news.co.tt/public_html/article...9011635308
Earlier today Trinity Exploration & Production plc told the London Stock Exchange it got 41% more per barrel of oil from Trinidad in the first half of the year (Jan. - June 2017) than it did the same period last year.
1. Average net production for H1 2016 is exclusive of the Guapo block which illustrates a like-for-like comparative. The year-on-year comparative inclusive of the Guapo block was 2,659 bopd which equated to an overall 10% decline
2. EBITDA: Operating profit before Depreciation, Depletion and Amortisation
3. Consolidated EBITDA/bbl: EBITDA / Net production
4. Consolidated operating break-even/bbl: See Appendix 1-Trading Summary Table
5. Net debt position is detailed in Appendix 2, unaudited Management view
H1 2017 Highlights
o Growing margins and increasing profitability within the current oil price environment
· Increased consolidated operating netback by 232% to USD 12.6/bbl (H1 2016: USD 3.8/bbl); and
· Reduced consolidated operating breakeven price by 6% to USD 28.2/bbl (H1 2016: USD 29.9/bbl).
o Strengthened balance sheet
· Reduction in net debt by 97% to USD (1.2) million (H1 2016: USD (34.3) million); and
· Increase in cash balance by 125% at period end of USD 11.5 million (H1 2016: USD 5.1 million).
o Safely growing production profitably
· 8% year-on-year, like for like production decline to 2,397 bopd (H1 2016: 2,612 bopd) was mainly due to natural decline and a lack of production investment in 2016;
· H1 activity set included:
- 5 Onshore Recompletions ("RCPs") (H1 2016: nil)
- 4 Onshore Reactivations (H1 2016: nil)
- 40 Workovers ("WOs") completed: 34 Onshore, 5 East Coast and 1 West Coast (H1 2016: 33);
- Resumption of Swabbing across 5 Onshore fields. (Swabbing is a process to mechanically remove liquids from the production zone of a gas or oil well)
· H1 production performance:
- During Q1 there was a proportionate return to production investment while ensuring that financial discipline was maintained;
- An upward production trajectory in Q2 was stymied by Tropical Storm Bret in June, with a quick recovery in July, and continued into August;
· Pioneered new technology on East Coast in June with the installation of an alternative low cost artificial lift; Mechanically Pumping Hydraulic Unit ("MPHU") on a slanted wellhead;
· Increased activity was commensurately matched with increased HSE focus through training and audits;
· Trinity received an HSE award for Safety Leadership Engagement from the national oil company; Petroleum Company of Trinidad and Tobago ("Petrotrin").
· Reduced downside exposure to commodity risk/low oil prices by hedging over 35% of production should the WTI oil price fall below USD 40.0/bbl in the period from 1st April 2017 to 31st March 2018, through the purchase of put options;
· Board changes, with Jeremy Bridglalsingh, David Segel and Angus Winther joining the board on the completion of the refinancing and restructuring in January 2017 and Jonathan Murphy stepping down and James Menzies joining the Board after the AGM in June 2017; and
· Retained the services of Walbrook PR Limited as financial PR advisor and Whitman Howard Limited as equity advisor.
Post Period End Highlights
o Continued upward trajectory in production
· A further increase in operating activities across core assets during July-August 2017 restored production with average production of 2,609 bopd in August 2017; and
· H2 2017 planned work programme consists of; at least 30 RCPs, 30 reactivations, 30 routine WOs and increased swabbing, which should enable the lower end of the initial production guidance (2,600-2,800 average bopd for 2017) to be achieved, and at a lower cost, and better economics, than originally planned.
o Sale of West Coast assets
· On 11th August 2017 Trinity announced that it entered into a binding sale and purchase agreement ("SPA") to sell its interests in the West Coast licences and related fixed assets to Range Resources Trinidad Limited ("Range") for a cash consideration of USD 4.55 million. The transaction is expected to complete in Q4 2017.
Bruce A. I. Dingwall CBE, Executive Chairman of Trinity, commented:
"Having secured Trinity's future in January, H1 2017 saw a directional change in the organisation's activities with the focus on preparing the Company for growing production safely while maintaining financial discipline in order to maximise the returns from our high-quality asset base. I am proud of the effort the team has given to date and grateful for the support the Company has received from our key suppliers and stakeholders. Our progress thus far is testament to that combined effort.
With the challenges of the last two years behind us our attention is now on safely increasing levels of profitable production from our core Onshore and East Coast assets and on obtaining the regulatory approvals that will allow the West Coast sale to reach financial close thereby further strengthening our balance sheet. H2 2017 has already seen operational activity ramping up with RCPs and WOs headlining the programme. Work on new infill targets is progressing well and the results may support an expansion of drilling options going forward.
Asset integrity is a fundamental part of our business cycle. We are undertaking several key infrastructure projects during H2 2017 to underpin further growth. Combined, these activities provide scope to grow production from current levels to an initial target run-rate of 3,000 bopd in the near future.
On behalf of the Board I must thank all our staff and stakeholders for their hard work and support which has allowed Trinity to focus on profitable growth. H1 2017 has been transformational and we are intent on building our business based on a sure footing in this new oil price environment.
We look forward with confidence and in providing a further quarterly update in November."
DETAIL OF PIC ABOVE PART 1
DETAIL OF PIC ABOVE PART 2