TIDMIAE
RNS Number : 8191L
Ithaca Energy Inc
06 October 2016
Not for Distribution to U.S. Newswire Services or for
Dissemination in the United States
Ithaca Energy Inc.
Third Quarter 2016 Operations Update
6 October 2016
Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) ("Ithaca" or the
"Company") provides an operations update following the end of the
third quarter of the year ("Q3-2016" or the "Quarter"). The Company
is scheduled to issue its financial results for the first nine
months of the year on 14 November 2016.
Highlights
-- 9,550 boepd average production for first nine months of 2016 - ahead of 9,000 boepd guidance
-- FPF-1 offshore hook-up and commissioning operations
progressing to plan - start-up of the Stella field continues to be
anticipated in November 2016
-- Significant progress made on installation of the oil export
pipeline from the FPF-1 to the Norpipe system
-- Continued deleveraging, with net debt at 30 September 2016 reduced to $598 million
Production & Operations
The producing asset portfolio has performed well over the first
nine months of the year ("YTD-2016"), with production running ahead
of guidance. Average production during the Quarter was
approximately 9,900 boepd, resulting in YTD-2016 average production
of 9,550 boepd.
It is anticipated that full year base production, excluding any
contribution from the start-up of the Stella field during 2016,
will be modestly ahead of the 9,000 boepd guidance range. During
the final quarter of the year, base production volumes will be
reduced compared to the previous quarters as a result of the
approximately two week planned maintenance shutdown of the Brent
Pipeline System that serves the Company's Northern North Sea
fields.
Greater Stella Area Development
Good progress has been made on the final stages of the Stella
development programme since the FPF-1 floating production facility
set sail from Poland in August 2016. The FPF-1 was safely towed to
the field, moored on location and the dynamic risers and umbilical
connecting the subsea infrastructure to the vessel installed as
planned. Technip is in the process of concluding the remaining
subsea commissioning works. At the same time the FPF-1 offshore
commissioning programme is on-going, with preparation of the
topsides processing and utility systems for the introduction of
hydrocarbons underway. The scheduled completion of these activities
remains in line with previous guidance, with first hydrocarbons
from the Stella field anticipated in November 2016.
Significant progress was also made during the Quarter on the
work programme associated with making the switch from tanker
loading to oil pipeline exports for the Greater Stella Area in
2017. The 44 kilometre spurline from the FPF-1 to the Norpipe
system was successfully installed as planned in September 2016. The
key outstanding activities that now remain to be completed are the
manufacture and installation of pipeline export pumps on the FPF-1
and the final subsea connections that need undertaking immediately
prior to the switchover.
Financials
Hedging
During Q3-2016 approximately 9,900 boepd (47% oil) of commodity
hedges were realised at an average price of $56/boe. The volume of
production hedged in the final quarter of 2016 remains unchanged,
at approximately 8,800 boepd (50% oil) at an average price of
$59/boe.
Operating Expenditure
As previously guided, average unit operating expenditure in 2016
for the existing producing asset base is anticipated to be
approximately $25/boe. Following the start-up of production from
the Stella field this cost is forecast to reduce to approximately
$20/boe, reflecting the lower unit operating costs associated with
the field.
Net Debt
Net debt at 30 September 2016 reduced to $598 million. The
Company has in place total available debt facilities of $730
million, providing in excess of $130 million of funding headroom
ahead of planned first hydrocarbons from the Stella field. This
funding capacity comprises $300 million unsecured senior notes and
$430 million bank debt facilities.
Q3-2016 Financial Results Conference Call
The Company is scheduled to release its Q3-2016 financial
results on 14 November 2016. A conference call and webcast for
investors and analysts will be held on the same day at 12.00 GMT
(07.00 EST). Listen to the call live via the Company's website
(www.ithacaenergy.com) or alternatively dial-in on one of the
following telephone numbers and request access to the Ithaca Energy
conference call: UK +44 (0)203 059 8125; Canada +1 855 287 9927; US
+1 855 442 0877.
Glossary
boe Barrels of oil equivalent
boepd Barrels of oil equivalent per day
MMbbl Millions of barrels of oil
RBL Reserves Based Lending facility
-S -
Enquiries:
Ithaca Energy
Les Thomas lthomas@ithacaenergy.com +44 (0)1224 650 261
Graham Forbes gforbes@ithacaenergy.com +44 (0)1224 652 151
Richard Smith rsmith@ithacaenergy.com +44 (0)1224 652 172
FTI Consulting
Edward Westropp edward.westropp@fticonsulting.com +44 (0)203 727 1521
Cenkos Securities
Neil McDonald nmcdonald@cenkos.com +44 (0)207 397 1953
Nick Tulloch ntulloch@cenkos.com +44 (0)131 220 9772
Beth McKiernan bmckiernan@cenkos.com +44 (0)131 220 9778
RBC Capital Markets
Matthew Coakes matthew.coakes@rbccm.com +44 (0)207 653 4000
Laura White laura.white@rbccm.com +44 (0)207 653 4000
Notes
In accordance with AIM Guidelines, John Horsburgh, BSc (Hons)
Geophysics (Edinburgh), MSc Petroleum Geology (Aberdeen) and
Subsurface Manager at Ithaca is the qualified person that has
reviewed the technical information contained in this press release.
Mr Horsburgh has over 15 years operating experience in the upstream
oil and gas industry.
References herein to barrels of oil equivalent ("boe") are
derived by converting gas to oil in the ratio of six thousand cubic
feet ("Mcf") of gas to one barrel ("bbl") of oil. Boe may be
misleading, particularly if used in isolation. A boe conversion
ratio of 6 Mcf: 1 bbl is based on an energy conversion method
primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead. Given the value ratio based on
the current price of crude oil as compared to natural gas is
significantly different from the energy equivalency of 6 Mcf: 1
bbl, utilising a conversion ratio at 6 Mcf: 1 bbl may be misleading
as an indication of value.
About Ithaca Energy
Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) is a North Sea oil
and gas operator focused on the delivery of lower risk growth
through the appraisal and development of UK undeveloped discoveries
and the exploitation of its existing UK producing asset portfolio.
Ithaca's strategy is centred on generating sustainable long term
shareholder value by building a highly profitable 25kboe/d North
Sea oil and gas company. For further information please consult the
Company's website www.ithacaenergy.com.
Forward-looking Statements
Some of the statements and information in this press release are
forward-looking. Forward-looking statements and forward-looking
information (collectively, "forward-looking statements") are based
on the Company's internal expectations, estimates, projections,
assumptions and beliefs as at the date of such statements or
information, including, among other things, assumptions with
respect to production, drilling, construction and maintenance
times, well completion times, risks associated with operations,
future capital expenditures, continued availability of financing
for future capital expenditures, future acquisitions and
dispositions and cash flow. The reader is cautioned that
assumptions used in the preparation of such information may prove
to be incorrect. When used in this press release, the words and
phrases like "anticipate", "continue", "estimate", "expect", "may",
"will", "project", "plan", "should", "believe", "could", "target"
and similar expressions, and the negatives thereof, whether used in
connection with operational activities, including remaining FPF-1
work activities prior to Stella first hydrocarbons, the timing of
Stella start-up and first hydrocarbons, production forecasts,
duration and timing of planned maintenance shutdowns and expected
reduction in base production volumes during the final quarter of
the year as a result, timing of Q3-2016 financial results release,
anticipated operating expenditures, or otherwise, are intended to
identify forward-looking statements. Such statements are not
promises or guarantees, and are subject to known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking statements. The Company believes that the
expectations reflected in those forward-looking statements are
reasonable but no assurance can be given that these expectations,
or the assumptions underlying these expectations, will prove to be
correct and such forward-looking statements included in this press
release should not be unduly relied upon. These forward-looking
statements speak only as of the date of this press release. Ithaca
Energy Inc. expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statement contained herein to reflect any change in its
expectations with regard thereto or any change in events,
conditions or circumstances on which any forward-looking statement
is based except as required by applicable securities laws.
Additional information on these and other factors that could
affect Ithaca's operations and financial results are included in
the Company's Management Discussion and Analysis for the quarter
ended 30 June 2016 and the Company's Annual Information Form for
the year ended 31 December 2015 and in reports which are on file
with the Canadian securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com).
This announcement contains inside information.
This information is provided by RNS
The company news service from the London Stock Exchange
END
UPDAKPDQABDDQKK
(END) Dow Jones Newswires
October 06, 2016 02:00 ET (06:00 GMT)
Ithaca Energy (LSE:IAE)
Historical Stock Chart
From Apr 2024 to May 2024
Ithaca Energy (LSE:IAE)
Historical Stock Chart
From May 2023 to May 2024