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
FOR
IMMEDIATE RELEASE
London, 29 January 2024
Operational Update for the
year ended 31 December 2023
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 year ended 31 December
2023 and provides production guidance for 2024. This update is
being issued in advance of the release of Nostrum's consolidated
accounts for the same period and is
therefore, at this stage, unaudited.
Arfan Khan, Chief Executive Officer of Nostrum Oil & Gas
PLC, commented:
"During the 2023 reporting period, we were delighted to
achieve several significant operational milestones across all our
assets as part of the implementation of our mixed-asset energy
strategy. In particular, the launch of the appraisal
campaign at our newly acquired Stepnoy Leopard
fields, the flawless re-start of our
state-of-the-art GTU-3 gas plant, the receipt of
the first ever
third-party feedstock into our gas treatment
facility, the
expansion of the
Gaslift system to reduce the production decline from our maturing
field, as well as the approval of the limited-scale drilling
programme for our maturing Chinarevskoye field.
We
will continue building on this momentum in 2024 to expand and
unlock further opportunities for all our
stakeholders."
FY2023 Highlights:
Operational
· Chinarevskoye
field
· Daily
production averaged 10,091 boepd (2022: 13,200 boepd).
· Daily
sales volumes averaged 8,874 boepd (2022: 12,524 boepd).
The sales volume split was as
follows:
|
Products
|
2023
volumes
(boepd)
|
2023
product
mix
(%)
|
2022
volumes
(boepd)
|
2022
product
mix
(%)
|
|
Crude Oil
|
2,702
|
30.4%
|
3,127
|
25.0%
|
|
Stabilised Condensate
|
1,969
|
22.2%
|
3,045
|
24.3%
|
|
LPG (Liquid Petroleum
Gas)
|
1,259
|
14.2%
|
1,665
|
13.3%
|
|
Dry Gas
|
2,944
|
33.2%
|
4,687
|
37.4%
|
|
Total
|
8,874
|
100.0%
|
12,524
|
100.0%
|
The difference between production and sales volumes is
primarily due to the internal consumption of gas.
On 23 July: successfully launched
the expansion of Gas lift system which doubled its capacity and
helped to slow down the production decline from the maturing
Chinarevskoye field.
On 19 December: commenced re-entry
drilling operations, in line with the licence commitments and field
development plan of the Company's subsidiary Zhaikmunai LLP.
The programme will leverage existing wellbores to reduce costs and
carries a level of uncertainties and risks as the planned
subsurface targets contain multiple exploration, appraisal, and
development objectives.
· Stepnoy Leopard
fields
On 17 July: completed the
acquisition of an 80% interest in Positiv Invest LLP, which
holds the subsoil use right for the Stepnoy Leopard
fields.
On 29 September: launched the
Stepnoy Leopard fields appraisal programme to confirm the
commercial potential, support future field development decision
making and the reclassification of certain of the hydrocarbon
resources into reserves.
· Ural OG
processing
On 21 December: successfully
received first gas from the Ural Oil & Gas LLP ("Ural
OG") Rozhkovskoye field U-21 well for treatment into Nostrum's gas
processing facility, with the remaining planned four wells to
commence in late 2024. A further update will be provided in the
Company's Q1 2024 results.
· GTU-3
re-start
On 4 September: successfully
re-started Nostrum's c.$750 million state-of-the-art GTU-3 gas
plant, with 2.5 billion cubic metres per annum gas processing
capacity. The Company completed the modifications and other works
on GTU-3 subsequent to its commissioning and start-up in
2019.
Financial
· Full
year revenues, in line with expectations, to be in excess of
US$118m (2022: US$199.7m), lower year on year by virtue of
anticipated declining production and relatively lower average
product prices (Brent price averaged US$82/bbl in 2023 vs
US$101/bbl in 2022).
· The
Group's unrestricted consolidated cash balance as at 31 December
2023 was in excess of US$161m (31 December 2022: US$233.6m), annual
reduction due to payment of 2022 coupon on completion of
Restructuring, payment for acquisition of Stepnoy Leopard fields,
and payments arising from 2016-2021 tax audit. The Group's
restricted cash balance as at 31 December 2023 was in excess of
US$25m (31 December 2022: US$31.0m), comprised of the debt-service
retention account and liquidation fund deposits.
·
On 9 February 2023, the Group
completed the bond restructuring initially announced on 23 December
2021 (the "Restructuring") and the related lock-up and forbearance
arrangements were terminated.
· The
Group continues to focus on cost optimisation to help manage
liquidity.
Sustainability, HSE
· One
contractor fatality during operations for 2023 (2022:
zero).
· One
Lost Time Injury ("LTI") for 2023 (2022: zero)
· Two
Total Recordable Incidents ("TRI") for 2023 (2022:
four).
·
4,987 tonnes of air emissions emitted
for 2023 against 6,309 tonnes permitted for 2023 under the
Kazakhstan Environmental Code.
·
Safety of all staff and
contractors as well as focus on conducting sustainable operations
remain the Group's priority.
2024 production guidance
· Chinarevskoye field average daily production forecast for 2024
is in the range of 7,000-8,000 boepd.
Release of Nostrum's 2023 Financial Results
Nostrum plans to release its annual
report and audited financial statements in respect of the financial
year ended 31 December 2023 on or around 26 March
2024.
LEI: 2138007VWEP4MM3J8B29
Further information
For further information please
visit www.nostrumoilandgas.com
Further enquiries
Nostrum Oil & Gas PLC
Petro Mychalkiw
Chief Financial Officer
ir@nog.co.uk
Instinctif Partners -
UK
Guy Scarborough
Vivian Lai
+ 44 (0) 207 457 2020
nostrum@instinctif.com
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) and the Astana International Exchange
(ticker symbol: NOG). The producing asset of Nostrum Oil & Gas
PLC is the Chinarevskoye field, which is operated by Zhaikmunai
LLP, a wholly-owned subsidiary of Nostrum Oil & Gas PLC and the
sole holder of the subsoil use rights with respect to the
development of the 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
relevant 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.