ADM Energy reports improvements at JKT facility
Updated : 13:56
Natural resources investing company ADM Energy updated the market on Thursday on operations at its oil reclamation business, JKT Reclamation, in which it holds a 30.6% economic interest.
The AIM-traded firm had reported ongoing improvements at the JKT facility on 23 May.
On Thursday, it said it had recently taken delivery of a 550-barrel capacity mixing tank and two new pumps, which would be installed at the Wilson, Oklahoma site imminently.
JKT had started a work programme to reconfigure existing storage capacity, install the new equipment, and undertake other projects aimed at enhancing the processing capacity and efficiency of the facility.
The operational performance of the facility had shown steady oil production since the start of operations in February.
In its first month, the facility produced 944 barrels of oil.
Production volumes increased to 1,475 barrels in March, before adjusting to 1,031 barrels in April, and 1,212 barrels in May.
Additionally, JKT was evaluating properties for a potential second reclamation facility in Texas.
Details regarding that expansion would be announced in due course, ADM said.
In a positive development, ADM Energy said it had received a cash distribution of $14,000 from JKT for production during April.
The company said it expected cash distribution levels to increase in line with production growth in the upcoming months.
ADM Energy said it was entitled to receive 42% of cash distributions until it had received a total of $356,250, after which it would receive 30.6% of the distributions.
“We are pleased by the initiation of the work program at the Wilson, Oklahoma facility and the expected increase in production and cash flow we expect the upgrade to drive upon completion,” said chief executive officer Stefan Olivier.
“The stable cash flow that this business is capable of generating fits ADM's strategy and the board is interested in participating in a second reclamation facility in the state of Texas.”
At 1136 BST, shares in ADM Energy were down 7.1% at 0.32p.
Reporting by Josh White for Sharecast.com.