President Energy beats net group production target for 2018

The AIM-traded firm said that represented an increase of over 50% year-on-year, and was being achieved without the benefit of any contribution from the Las Bases Concession, and with a limited contribution from the Puesto Prado and Estancia Vieja fields, all in Rio Negro Province, Argentina.

Commercial gas sales from the Las Bases and Estancia Vieja Concessions were expected to begin by the end of the first quarter of 2019.

Production in the Puesto Guardian field in Salta Province remained stable, the board said, as did production from President's interests in Louisiana.

At well PF0 1005, the board said it had now been successfully tested and placed on production, with initial levels of approximately 250 bopd, being in excess of expectations.

Both the Punta Rosada and the Lotena formations were producing on a commingled basis.

Management said it expected that the next reserves audit, due to be published in March, would show a “significant increase” in 1P Proven reserves at its Rio Negro Concessions due to the successful drilling and workover campaigns delivered in 2018.

The latest result meant the three-well drilling programme had met with 100% success, the board added.

All wells were now producing, and were delivered on time and budget.

President said it was now monitoring overall field performance, in line with good reservoir management practice, with the objective of maximising monthly average production and minimising downtimes.

Looking ahead, the company said operational work in the first quarter of 2019 would include, but would not be limited to, preparation and planning of the next drilling campaign in Argentina due to commence in the second quarter, ramping up into the second half, as well as long lead planning for 2019 exploration in Paraguay.

Workover campaigns in Rio Negro would bring on new production from currently shut-in wells in the Puesto Prado and Estancia Vieja fields, which the board said would further enhance their economies of scale.

It would also begin added value commercial gas production and pipeline sales from existing shut-in wells at the Las Bases and Estancia Vieja fields, as it seeked to have a greater revenue contribution from gas production.

Electrification of the Rio Negro fields using President's own gas from Estancia Vieja would also take place, making “substantial” operational savings and avoiding costly power outages from the grid.

The company would install a dual fuel power system in the Dos Puntitas field, Puesto Guardian Concession in Salta Province, Argentina using its own generated gas, reducing reliance on diesel.

Preparations and planning for a four well drilling programme were set to begin early in the second quarter at Jefferson Island, Louisiana, with the company also saying it would continue to focus on costs and margins, benefiting from increasing efficiencies through sensible investment and greater economies of scale generated by “significant” production growth.

“Our objectives for 2018 were successfully delivered, and are history now,” said President Energy executive chairman Peter Levine.

“The strategy for 2019 is to take everything we achieved and build on it to deliver another year of dynamic growth and profitability both organically and by acquisition.

“The expected significant increase in Proven reserves from our Rio Negro assets underlines the material improvement in shareholder value achieved last year.”

Levine said that, while President's 2P Proven and Probable reserves and extensive resources were important to demonstrate future potential, the essential core value of the business was reflected by proven hydrocarbon reserves - particularly with greater emphasis from the higher value added Rio Negro fields.

“President continues to maintain a 360 degree focus on every aspect of the business from new production, reserves and reservoir management to the crucial aspects of cash management and control of G&A costs and expenses.

“We look forward to delivering and escalating shareholder value in 2019.”