Independent Oil and Gas plc (AIM: IOG.L), the North Sea focused Oil and Gas Company, announces its interim results for the six month period ended 30 June 2015.
- Sale and Purchase Agreement to acquire the 50% of licence P1609 containing the Skipper discovery from Alpha Petroleum Resources Ltd. signed and the completion date has been extended to 7 December 2015.
- Upon completion of the acquisition and regulatory approvals, IOG will become Operator of the licence, with a 100% interest
- IOG’s independently verified 2C resources will increase by 13.1 MMBbls.
- 3D seismic remapping project with Baker Hughes RDS over its Southern North Sea gas portfolio commenced with positive initial results.
- Block 48/22c increased by 42km² to the South and now contains the Hambleton discovery.
- Loss after tax of £0.20 million (1H 2014 – £1.47 million),
- Cash resources as at 30 June 2015 of £0.03m (31 December 2014 – £0.32m). Subsequently the Company raised £0.2m through share subscriptions and continues to use its cash resources judiciously.
Post period end:
- Licence P1609, extended by the Oil and Gas Authority (‘OGA’) to 31 December 2015.
- Positive progress made towards drilling the Skipper well with a contractor led approach to funding. Planning is now at an advanced stage and essential long lead items have been ordered to facilitate drilling later in 2015.
- Advanced discussions ongoing with a number of service companies including rig owner, well operator, subsea equipment supplier and an essential rig services provider.
- Service providers have provided indications of support either to part-fund the well, defer payment or to provide loans to secure their participation in the appraisal well and subsequent development. Total expected commitments are estimated at approximately £7 million.
- Terms agreed with AGR Well Management to assist with the well planning and to become the designated well operator on completion of the Skipper acquisition, subject to the completion of documentation.
- Discussions with FPSO providers are ongoing for the Skipper field development.
- The Group’s current cash balance only gives the Directors comfort that its liquid reserves are sufficient to satisfy its near term general and administrative costs until late October 2015 but not any operational work
- Accordingly, the Group continues to seek additional funding which may include a partial farm down of assets, an additional debt facility or an equity fundraising.
- Discussions with several funders ongoing and Darwin Strategic has agreed to extend its outstanding loan to 7 December 2015.
Mark Routh, CEO of IOG, said:
‘The Company has been working hard to continue the development of our portfolio, both towards the drilling of the Skipper well and de-risking our Southern North Sea gas hub. These efforts continue amid a very challenging industry environment with the significant ongoing cyclical downturn in commodity prices.
We are making good progress on an innovative funding solution to enable the Skipper appraisal well to be drilled in the coming months and are confident this will provide a substantial uplift in terms of reserves and Company value. IOG has a strong team and we are very encouraged by the support shown by all of our stakeholders including investors, creditors, contractors, services providers and regulators to achieve our development plans in the face of this downturn and deliver shareholder value.’
This article is for information and discussion purposes only and does not form a recommendation
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