TIDMPPC
RNS Number : 8036T
President Energy PLC
25 March 2019
25 March 2019
PRESIDENT ENERGY PLC
("President", "the Company" or "the Group")
Rio Negro Province, Argentina
Fully funded US$50 million 2019/2020 Work Programme
15 New wells, some 20 Workovers with pipeline and infrastructure
works
Programme set to deliver 50% exit production growth year on
year
President Energy (AIM: PPC), the upstream oil and gas company
with a diverse portfolio of production and exploration assets
focused primarily in South America, confirms plans for its work
programme for 2019/20 at its fields in Rio Negro Province,
Argentina (President 90%, Edhipsa 10%).
The estimated cost of the work programme between now and the end
of 2020 is approximately US$50 million and is anticipated to be
funded from President's existing cash flow without recourse to any
additional finance or borrowings ceteris paribus.
Summary Work Programme
2019
-- From now through mid-year an aggregate of at least 10
workovers in Puesto Flores (oil), Estancia Vieja (oil/gas), Puesto
Prado (oil) and Las Bases (gas) will be carried out. The rig is
currently being mobilised to the first well location
-- By end of May, the renovation and commissioning of the oil
treatment plant in Puesto Prado. The commencement of deliveries of
oil from the field direct to local refineries will give enhanced
margins (current production 150 bopd from this area)
-- From end of May through to November the first phase repair,
upgrading and commissioning of the multi-million dollar value gas
plant in Las Bases in order for it to have the capacity to handle
initially up to 250,000 m(3) of gas of President's own gas per day
by end of October. The pipeline is already transporting
approximately 20,000 m(3) per day of third party gas for which a
tariff is payable to President
-- In any event by mid-year gas flow will commence to the market
from the Las Bases and Estancia Vieja fields through temporary
facilities
-- From July through end of the year a target of seven new production/appraisal wells
-- By end September, the erection and completion of 14 km of new
overhead electric lines between Estancia Vieja and Puesto Flores
fields and the commissioning of an electricity generation plant to
power the latter field from the former's gas and to sell surplus
electricity generated to the grid
-- By end October, the commencement of increased volumes of gas
flowing through the building, completion and commissioning of a
brand new 16 km section of 4" steel pipeline to be laid between
Puesto Prado and Las Bases replacing the limited capacity 3"
flexible pipeline between those points
-- The commencement of a further workover programme from
October, details to be advised once the results of the present
campaign are reviewed
-- The continuation of infrastructure works throughout the year
2020
-- The drilling on a rolling continuous programme through the
year of an aggregate of eight new wells in Las Bases (gas), Puesto
Prado (gas/oil), Estancia Vieja (gas) and Puesto Flores (oil). The
wells being a combination of development, appraisal and exploration
wells
-- Phase Two of the upgrading of the Las Bases gas plant will be
completed to increase its capacity to its original design
capability of 1 million m(3) of gas
-- An aggregate of at least eight workovers of wells in the
various fields in Rio Negro will be carried out
Commentary
1. The above programme, estimated to cost approximately US$50
million between now and the end of 2020 is anticipated to be funded
from President's existing cash flow without recourse to additional
finance or further borrowing on current market factors remaining
broadly the same. Further, by end 2020 the Company's financial
borrowings will have reduced by over US$6 million as inter alia
bank borrowing facilities are steadily repaid.
2. Whilst modest in comparison to the total capex spend, the
proceeds from recent fund raise has performed a very helpful role
in enabling President to accelerate this programme as such
additional increment gathers operational momentum later in the
period.
3. The work now planned will power the significant growth of the
Company from its organic assets and is a major step up in activity
from that in 2018 when significant progress was achieved in all key
performance indicators.
4. In addition to the above programme which relates only to the
Company's Rio Negro assets, planning work will continue in parallel
for the drilling of up to two development wells in the Puesto
Guardian Concession, one exploration well in the Pirity Concession,
Paraguay, (President 100%) all targeted for end 2019/early 2020 and
up to four exploration wells at Jefferson Island, Louisiana,
(President 20% and operator) currently projected to commence by mid
2019. It is anticipated that all such work will likewise be funded
from the Company's own resources.
5. The Company is currently targeting 50% exit production growth
year on year in each of 2019 and 2020 and will provide updated
guidance during Q3 2019 as the work programme develops.
Glossary of terms
M(3) - million cubic metre of gas
Bopd- barrels of oil per day
For further information please contact:
President Energy PLC
Peter Levine, Chairman
Rob Shepherd, Group FD +44 (0) 207 016 7950
finnCap (Nominated Advisor)
Christopher Raggett, Scott Mathieson +44 (0) 207 220 0500
Panmure Gordon (Joint Broker)
Charles Lesser, Dominic Morley +44 (0) 207 886 2500
Whitman Howard (Joint Broker)
Hugh Rich, Grant Baker +44 (0) 207 659 1234
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 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
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
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Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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