TIDMJKX
RNS Number : 5824F
JKX Oil & Gas PLC
19 July 2021
19 July 2021
JKX Oil & Gas plc
("JKX", the "Company" or the "Group")
Quarterly Operations Update
Highlights
-- Ukraine average production of 4,101 boepd for Q2 2021,
7% higher than during Q1 2021.
-- Net $36.5m of cash and cash equivalents, and oil and
gas inventory of approximately $4.4m in value, held at
30 June 2021.
-- The gas and oil prices in Ukraine have significantly
improved by 77% and 58% respectively in comparison with
H1 2020.
-- IG149, a new well in the Ignativske field, was drilled
and brought into production in Q2 2021. The well has
produced an average of 962 boepd since starting production
on the 21(st) May 2021.
Production
Q2 Q1 Q on Q H1 H1 Y on Y
% % Change
Change
2021 2021 2021 2020
Total production, boepd 9,332 9,177 2% 9,255 10,445 (11)%
Ukraine, boepd 4,101 3,843 7% 3,973 5,162 (23)%
- Average gas production,
Mcmd 521 517 1% 519 690 (25)%
- Average oil and condensate
production, boepd 1,032 799 29% 916 1,100 (17)%
Russia, boepd 5,231 5,334 (2)% 5,282 5,283 0%
- Average gas production,
Mcmd 879 896 (2)% 888 887 0%
- Average condensate
production, boepd 58 58 0% 58 59 (2)%
Hungary, boepd 0 0 0% 0 0 0%
Prices realised
Ukraine
- Average gas price,
$/Mcm 250 214 17% 232 131 77 %
- Average oil and condensate
price ($/bbl) 65 60 8 % 63 40 58%
Russia
- Average gas price,
$/Mcm 52 52 - 52 54 ( 4 )%
In Ukraine:
-- IG149, a new well in the Ignativske field was drilled
and completed in the Devonian reservoir. Following testing
the choke was reduced to 25/64ths". Average production
from this well in June was 915 boepd with a current wellhead
pressure of 930 psig.
-- IG21, a leased well in the Ignativske field, was worked
over to test the Visean carbonate reservoir and came
online at an initial rate of 256 boepd and produced an
average of 50 boepd since coming online in the second
half of April.
-- The drilling rig was demobilised following the drilling
of IG149 and is expected to return to PPC ("Poltava Petroleum
Company") in September to spud the next well. Meanwhile
the PPC owned workover rig continues operating in the
Novo-Nik complex.
In Russia:
-- Acid treatments were carried out on 3 wells in Q2 2021
with no significant incremental production increase achieved.
The coiled tubing unit has now been demobilised from
the field as there are now not many future acid treatments
expected to be required due to stable production from
all wells.
-- Russian average production was 5,282 boepd in H1 2021
and is unchanged from H1 2020 with no new wells added
in the last year.
Liquidity
In $m 30 June 31 Dec 30 Jun 31 Dec
2021 2020 2020 2019
Total cash and cash equivalents 36.5 24.3 14.5 20.6
Bond liability (principal
and interest accrued) - - - (5.7)
Net cash 36.5 24.3 14.5 14.9
Approximate sales value
of gas and oil inventory 4.4 2.2 1.7 4.1
Our Ukrainian subsidiary held 3.0 million cubic metres of gas
and 50.8 thousand barrels of oil inventory available for immediate
sale at 30 June 2021. Approximate sales value of gas and oil
inventory is calculated using average sales prices for June
2021.
Rental fee claims
Claims issued by the Ukrainian tax authorities for additional
rental fees for 2010 and 2015 are still being contested through the
Ukrainian court process as explained in the 2020 Annual Report. In
July 2021 the Supreme Court satisfied demands of Poltava Petroleum
Company (PPC) in respect of the case No. 816/844/16 and left the
decisions of first and appellate instance courts in force. Also PPC
has received the final judgement of the Supreme Court of Ukraine in
Case No.816/4476/14 relating to the Poltava Tax Authorities appeal
against lower court judgments in this case. This case relates to a
claim for 2010 royalty payments and a judgment has been made in
favour of the Poltava Tax Authorities. PPC is under no immediate
obligation to pay the judgement as the Ukrainian tax authorities
have to obtain approval of the Supreme Court of Ukraine before the
payment can be collected from PPC. This hearing is expected to be
heard in late 2021.
International arbitration award
The international arbitration award, directing the State of
Ukraine to pay $11.8m plus interest and $0.3m costs to JKX as
described in the 2020 Annual Report, was successfully legally
recognised in Ukraine and JKX filed for collection. No possible
future benefit that may result from this award will be reflected in
the accounts until there is further clarity on the process for, and
likely success of, enforcing collection.
Covid-19
The Group has all necessary arrangements in place to ensure the
safe conduct of its business. We have implemented a number of
policies recommended by Governments in the countries of our assets
for the protection of our employees, as well as to help minimize
the spread of coronavirus (Covid-19). Our first priority is the
safety and wellbeing of our staff. Our next priority is supporting
the local communities, especially where there is a lack of medical
assistance, and we have directed our corporate and social
responsibility projects helping to fight further spread of
Covid-19. We continue to monitor the impact of Covid-19
developments on our industry, operations, staff and contractors and
are confident about the safety measures we put in place.
boepd - Barrels of oil equivalent per day
bopd - Barrels of oil per day
Mboe - Thousand barrels of oil equivalent
Mcm - Thousand cubic metres
MMcm- Million cubic metres
Mcmd - Thousand cubic metres per day
psi - pounds per square inch
This announcement contains inside information as defined in EU
Regulation No. 596/2014 and is in accordance with the Company's
obligations under Article 17 of that Regulation.
ENDS
JKX Oil & Gas plc +44 (0) 20 7323 4464
Dmytro Piddubnyy, CFO
EM Communications +44 (0) 20 7002 7860
Jeroen van de Crommenacker
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END
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