Baron Oil plunges as annual loss widens

In the period to 31 December, the London-listed group posted a pre-tax loss of £3.35m, which was 11.6% wider than in the corresponding period in 2013.

Revenue rose 28% year-on-year to £2.83m, although the company said that due to a number of disruptions it suffered in 2013, the 2014 turnover reflects the significant impact of falling oil prices relative to the cost of production in the Colombian wells.

Continuing disruptions to production and operating difficulties have led the group to review its strategy for the Nancy-Burdine-Maxine (NBM) field in Colombia and, as a result, the Baron has decided to fully impair all remaining NBM assets.

The group said the decision resulted in a £2.2m increase in impairment charges, adding the volatility of the oil market was likely to affect prices in the medium- to long-term future.

Group chairman Bill Colvin said 2014 had been an “extremely difficult” year for the group but said the group was evaluating a number of new projects.

Baron Oil shares were down 11.01% to 0.890p at 09:06 on Wednesday.