Prospex narrows losses as it makes good development progress

Investment company Prospex Oil and Gas issued its interim results for the six months ended 30 June on Monday, reporting “rapid progress” being made across its three key investment assets.

The AIM-traded firm said that progress was in line with its strategy to build a “leading” oil and gas investment company, focussed on high impact European opportunities with short timelines to production.

It said it was set to commence imminent production at the Bainet-1 well in Romania, which would be achieved within just over a year of initial project acquisition and 10 months of drilling the exploration well.

That followed the successful completion of development permitting and the installation of a flowline to achieve access to existing Bilca production facility.

At the Podere Maiar-1d well in Italy, which the company described as a “significant” gas discovery, peak flow rates of 148,136 scm/day and 129,658 scm/day had been achieved respectively from two gas-bearing reservoirs.

Production concession applications had been submitted and targeted to commence in the first or second quarter of 2020.

Prospex said defined work programmes were underway to de-risk up to 830 billion cubic feet of gas of gross unrisked prospective resources, with an upside in excess of 2 Tcf resources at the Tesorillo Project in Spain.

It said a multi strand work programme had begun, with the firm saying it had garnered “strong” local and regional support through community engagement programmes.

On the financial front, Prospex remained pre-revenue, with its administrative expenses rising to £0.54m from £0.38m in the first half of last year.

Its loss before tax narrowed, however, to £0.54m from £2.85m.

“Prospex has built a highly strategic portfolio based on its investment criteria of acquiring undervalued, late stage projects in proven European hydrocarbon jurisdictions that can be rapidly advanced into low cost production thanks to the availability of historic data and established infrastructure,” said Prospex managing director Edward Dawson.

“Through this development approach we are now on the verge of commencing commercial production in Romania.

“We look forward to delivering on this significant milestone alongside a number of other key developments in the coming months, as we focus on generating significant value for shareholders.”