Eland Oil & Gas halves losses after first oil sale in 2014

Eland Oil & Gas, the exploration and production group focused on West Africa, halved its annual losses in 2014 and gave a confident outlook despite a tough operating climate within the oil industry.

The AIM-listed outfit, which has a particular focus on Niger Delta region of Nigeria, reported a consolidated loss for last year of $16.3m, compared with a $26.1m loss in 2013.

The improvement came as the company generated its first revenues of $11.7m from the sale of 115,722 barrels of crude oil, with first oil consignment dispatch achieved in February 2014.

The company said 98,942 barrels were produced in the fourth quarter alone as downtime reduced considerably.

"Following a near halving of the oil price, our industry is facing major challenges, but I remain confident that we have the assets and a management team that can deliver value to our shareholders," said chairman Harry Wilson.

During the year, an evaluation of reserves and resources at its OML 40 licence onshore Nigeria saw best-estimate prospective resources increase of 113%

Looking ahead, the company also said it was hoping to increase its current $35m committed debt facility to $75m through syndication in the second quarter.

The funds, along with cash flows from operations, will help "accelerate development of the Opuama field and grow the company's net production to our desired 2015 exit rate and beyond", according to chief financial officer Louis Castro.

Eland is targeting a 2015 year-end gross production exit rate from OML 40 of 12,000 barrels of oil per day.