TIDMNOG
RNS Number : 1429X
Nostrum Oil & Gas PLC
30 April 2021
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT
JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
London, 30 April 2021
Operational Update for the first quarter ending 31 March
2021
Nostrum Oil & Gas PLC (LSE: NOG) ("Nostrum", or the
"Company" and together with its subsidiaries, the "Group"), an
independent oil and gas company engaging in the production,
development and exploration of oil and gas in the pre-Caspian
Basin, today announces its operational update in respect of the
three months ended 31 March 2021.
Highlights:
Operational
-- Average daily production after treatment for Q1 2021 totalled
19,341 boepd with average daily sales volumes for the quarter
of 17,419 boepd. Production guidance for the year is 17,000
boepd and 16,000 boepd, respectively.
-- We remain extremely vigilant in respect of COVID-19. We
continue to implement stringent precautionary measures and
we believe we have the systems in place to monitor and manage
the risks presented by the pandemic in west Kazakhstan.
To date, no production has been lost because of COVID-19.
-- A well workover and well intervention programme started
in April 2021. The programme is currently for 6 workovers
and up to 20 interventions with an expected cost of US$7.3
million.
-- We continue to focus on ways to monetise spare capacity
in the gas treatment facility through processing third party
volumes.
Financial
-- Q1 2021 revenues expected to be in excess of US$46 million
(Q1 2020: US$60.4 million).
-- The cash position as at 31 March 2021 in excess of US$85
million excluding US$21.5 million held in a restricted account
under the terms of the Forbearance Agreement (the "Restricted
Cash") with an informal ad hoc committee of noteholders
(the "AHG") (31 December 2020: US$78.6 million excluding
$12.9 million held in as Restricted Cash).
-- Total debt(1) expected not to exceed US$1,208 million and
net debt expected not to exceed approximately US$1,123 million
as at 31 March 2021. Net debt position as at 31 March 2021
does not take into account Restricted Cash.
-- Continued focus on cost optimisation to help manage our
liquidity.
-- Interest on debt due in February and March 2021 was not
paid. The expiry of the Forbearance Agreement was extended
to 20 April 2021 and then to 20 May 2021 both with the unanimous
consent of the AHG.
(1 Total debt does not include finance lease liabilities under
IFRS16 Leases)
Bond Restructuring
-- Discussions continue with the advisers to the AHG to agree
a restructuring of the debt.
-- The final consent fee for 9.9288 bps equating to US$1,116,990
was paid on 22 February 2021. The total consent fees paid
under the Forbearance Agreement are US$6,701,973.
-- On 22 March 2021, the Company announced that the approval
has been received from all the members of the AHG to extend
the expiry of the Forbearance Agreement from 4 p.m. on
20 March 2021 to 4 p.m. on 20 April 2021. In return for
the AHG agreeing to extend the forbearance period to 20
April 2021, the Company agreed to pay into the secured
account an amount of US$1,116,990, equating to 9.9288 bps
of the outstanding Notes. This amount was paid into the
secured account on 30 March 2021. The total amount paid
into the secured account at 31 March 2021 is US$21,541,990.
-- On 20 April 2021, the Company announced that the approval
has been received from all the members of the AHG to extend
the expiry of the Forbearance Agreement from 4 p.m. on
20 April 2021 to 4 p.m. on 20 May 2021.
Arfan Khan, Chief Executive Officer of Nostrum Oil & Gas,
commented:
"In 2020, Nostrum has taken all necessary steps to safeguard its
core business through streamlining operations and prioritising cost
reduction. Together with a sustainable and affordable bond
restructuring, the Company will lay down solid foundations to build
from.
Pivoting towards growth and transitioning into a multi-asset
energy company will require tremendous focus and resources. Our
existing world-class gas infrastructure and spare operational gas
capacity can be monetised further immediately with nearby material
opportunities such as processing and handling of the Ural Oil &
Gas LLP production.
There are a number of additional area-wide opportunities under
review that will serve to strengthen our upstream and midstream
portfolio in the coming years.
Our success in the near-term, however, depends on the following
must-wins:
-- Continuing focus on HSE and COVID risk management;
-- Stabilising Nostrum through negotiating a sustainable
restructuring arrangement supported by our stakeholders that also
leaves sufficient headroom for raising further capital for our
growth projects, as required;
-- Safeguarding base business and liquidity by continuing to
optimise production and cost efficiencies; and
-- Maximising the output from the producing asset and adding to
PDP by exploiting low cost per barrel, high-confidence infill
opportunities with best-in-class well & reservoir management
."
Sales volumes
Average daily Q1 2021 sales volumes of 17,419 boepd
comprised:
Products Q1 2021 sales volumes 2020 product mix
(boepd) (%)
Crude Oil 3 ,919 22.5%
--------------------- ----------------
Stabilised Condensate 3,368 19.3%
--------------------- ----------------
LPG (Liquid Petroleum Gas) 2,294 13.2%
--------------------- ----------------
Dry Gas 7,838 45.0%
--------------------- ----------------
Total 17,419 100.0%
--------------------- ----------------
The difference between production and sales volumes is primarily
due to the internal consumption of gas
Note: The volumes above represent sales made. There were sales
of stabilised condensate only in January and March 2021 since there
was insufficient in February 2021 to form a cargo.
2021 Well Stock
-- As at 31 March 2021, the Company had 45 wells in production
(24 oil wells and 21 gas-condensate wells).
2021 Drilling and sales volume guidance
-- The Company has not planned a drilling programme in 2021 but
will conduct a targeted well work-over and intervention programme,
similar to that conducted in 2020.
-- The average daily production forecast for 2021 is 17,000
boepd, corresponding to an average daily sales v olume of 16,000
boepd.
Interim Chief Financial Officer
On 29 April 2021, the Board of the Company extended the contract
of the interim Chief Financial Officer, Martin Cocker, from 30
April 2021 (the expiry date) to 31 August 2021.
Release of Nostrum's Q1 2021 Financial Results
Nostrum plans to release its unaudited and unreviewed condensed
interim consolidated accounts for the period ending 31 March 2021
on 18 May 2021.
LEI: 2138007VWEP4MM3J8B29
Further information
For further information please visit www.nog.co.uk
Further enquiries
Martin Cocker - Interim Chief Financial Officer
ir@nog.co.uk
Instinctif Partners - UK
Mark Garraway
Sarah Hourahane
Galyna Kulachek
+ 44 (0) 207 457 2020
nostrum@instinctif.com
Promo Group Communications - Kazakhstan
Asel Karaulova
Irina Noskova
+ 7 (727) 264 67 37
Notifying person
Thomas Hartnett
Comp any Secretary
About Nostrum Oil & Gas
Nostrum Oil & Gas PLC is an independent oil and gas company
currently engaging in the production, development and exploration
of oil and gas in the pre-Caspian Basin. Its shares are listed on
the London Stock Exchange (ticker symbol: NOG). The principal
producing asset of Nostrum Oil & Gas PLC is the Chinarevskoye
field, in which it holds a 100% interest and is the operator
through its wholly-owned subsidiary Zhaikmunai LLP. In addition,
Nostrum Oil & Gas holds a 100% interest in and is the operator
of the Rostoshinskoye oil and gas field through the same
subsidiary. Located in the pre-Caspian basin to the north-west of
Uralsk, this exploration and development field is situated
approximately 100 kilometres from the Chinarevskoye field.
Forward-Looking Statements
Some of the statements in this document are forward-looking.
Forward-looking statements include statements regarding the intent,
belief and current expectations of the Company or its officers with
respect to various matters. When used in this document, the words
"expects", "believes", "anticipates", "plans", "may", "will",
"should" and similar expressions, and the negatives thereof, are
intended to identify forward-looking statements. Such statements
are not promises nor guarantees and are subject to risks and
uncertainties that could cause actual outcomes to differ materially
from those suggested by any such statements.
No part of this announcement constitutes, or shall be taken to
constitute, an invitation or inducement to invest in the Company or
any other entity, and shareholders of the Company are cautioned not
to place undue reliance on the forward-looking statements. Save as
required by the Listing Rules and applicable law, the Company does
not undertake to update or change any forward-looking statements to
reflect events occurring after the date of this announcement.
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END
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