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, 20 August 2024
Financial Results for the
second quarter and six months ended 30 June 2024
Nostrum Oil & Gas PLC (LSE: NOG)
("Nostrum", or the
"Company" and together with
its subsidiaries, the "Group"), an independent mixed-asset
energy company with world-class gas processing facilities and
export hub in north-west Kazakhstan, today announces its financial
results for the second quarter and six months ended 30 June
2024 ("H1 2024").
Nostrum's management team will
present the H1 2024 results and will be available for a Q&A
session with analysts and investors today, 20 August 2024, at 2pm
UK time. If you would like to participate in this call, please
register by following the instructions provided in this
link:
Results Call
Arfan Khan, Chief Executive Officer of Nostrum Oil & Gas,
commented:
"I am pleased to share the Group's
results for H1 2024. We delivered solid operational and financial
performance during this period, while also reaching key milestones
that are strategically important for the Company's transformation
into a mixed-asset energy company.
An increase of 44% in EBITDA for the
first half of 2024, compared to the same period last year, along
with a net positive operating cash flow during this period,
highlights the successful initial results of the Company's new
strategy, which includes processing third-party hydrocarbons from
neighbouring Ural Oil & Gas
LLP.
In April we announced our final
investment decision for the initial development phase of the
Stepnoy Leopard Fields, followed by the release of the Stepnoy
Leopard Competent Person's Report in July, which added 110 mmboe
net to Nostrum's 2P reserves base, at an estimated NPV10 of
approximately US$220 million.
As always, health and safety remain
our priority, as we focus on operational excellence and continue
managing our liquidity to maximise value for all our investors and
stakeholders."
H1
2024 Highlights:
Financial
|
·
|
Revenues of US$65.3 million, a 23.7%
increase compared to US$52.8 million in H1 2023, resulting from
additional sales volumes of dry gas and LPG produced from Ural Oil
& Gas LLP ("Ural O&G") and US$3.9 million of condensate
tolling revenue. Brent crude oil price increased from an average of
US$79.7/bbl in H1 2023 to an average of US$83.7/bbl in H1
2024.
|
|
|
|
|
·
|
44% increase in EBITDA1 of
US$22.3m (H1 2023: US$15.5m) with EBITDA margin of 34.2% (H1 2023:
29.4%). The increase is primarily driven by increased production
and revenues as well as prudent cost management.
|
|
|
|
|
·
|
The Group's unrestricted cash balance
as at 30 June 2024 was US$142.5 million, including current
investments in fixed term deposits and liquid money market funds.
Excluding one-off items, our closing unrestricted cash position at
the end of June would have been US$158.4m, a slight decrease from
the 2023 year-end cash balance of US$161.7m.
|
|
|
|
|
·
|
The restricted cash balance (DSRA and
asset liquidation fund) was US$25.5 million as at 30 June 2024 (31
March 2024: US$25.2 million).
|
|
|
|
|
·
|
The Group continues to focus on
maximising facility uptime, controlling costs and improving
efficiencies across all facets of our business, while allocating
and efficiently utilising existing resources on growth
projects.
|
Operational
· Production and
sales
· Daily
production averaged 12,220 boepd (H1 2023:
10,048 boepd), a 22% increase driven
by:
o Additional volumes of dry gas and LPG produced from processing
raw gas received from Ural O&G
at Nostrum's gas processing facilities.
o Successful launch of the gas-lift system expansion
in July 2023, which doubled its capacity and helped to slow
down the production decline from the maturing Chinarevskoye
field.
o Additional LPG production from GTU-3 owing to improved yield
by around 20%.
· The
production volume split for H1 2024 was as follows:
|
Products
|
H1
2024
volumes
(boepd)
|
H1
2024
product
mix
(%)
|
H1
2023
volumes
(boepd)
|
H1
2023
product
mix
(%)
|
|
Crude Oil
|
2,393
|
19.6%
|
2,723
|
27.1%
|
|
Stabilised Condensate*
|
1,850
|
15.1%
|
1,898
|
18.9%
|
|
LPG (Liquid Petroleum
Gas)
|
1,983
|
16.2%
|
1,258
|
12.5%
|
|
Dry Gas
|
5,994
|
49.1%
|
4,169
|
41.5%
|
|
Total
|
12,220
|
100.0%
|
10,048
|
100.0%
|
*Stabilised condensate volumes
exclude Ural O&G processed volumes for which Nostrum receives a
tolling fee
· Daily
sales volumes averaged 10,475 boepd for H1 2024 (H1
2023: 9,020 boepd).
The difference between production and sales volumes is primarily
due to the internal consumption of dry gas produced and may also
include inventory increases or decreases at period end.
· Chinarevskoye drilling
programme
The well No.301 was put into
production in May 2024, with initial flow rates in line with the
management's expectations. The sidetrack well No.41 completion is
expected in Q3 2024.
· Stepnoy Leopard
Fields
Following the final investment decision for the initial development phase of
the Stepnoy Leopard Fields in March 2024, Nostrum
released the full-field
development Stepnoy Leopard
CPR, an evaluation of reserves and resources as
of 1 January 2024 prepared by Xodus Group Limited. The
full-field development Stepnoy
Leopard CPR resulted in addition of
110 mmboe (80% working interest) net 2P reserves
with US$220m after-tax net (80% working interest) NPV10 and 34%
IRR.
· Ural O&G third-party
processing
Throughout H1 2024 the Company
continued processing Ural O&G raw gas from the U-21 well in the
Rozhkovskoye field. The tie-back of an additional four wells during
2024 is expected to increase processing to 1.5
Mm3/day of raw gas (Ural O&G
(MOL) guidance).
Sustainability and HSE
· Zero fatalities among employees and contractors during
operations in H1 2024 (H1 2023: zero).
· Total
Recordable Incidents Rate (incidents per million man-hours) of 0.64
for H1 2024 (H1 2023:1.0).
· Zero
Lost Time Injury Rate (incidents per million man-hours) for H1 2024
(H1 2023: zero).
· 2,590
tonnes of air emissions emitted in H1 2024 against 5,983 tonnes
permitted for 2024 under the Kazakhstan Environmental
Code.
· Improved independent ESG Risk Rating of 29.2 (end of 2023:
30.1), moving Nostrum to Medium risk category.
Notes to press release
1 EBITDA is a non-IFRS measure and is
defined as profit before tax net of depreciation, depletion and
amortisation, share-based compensation, foreign exchange losses,
finance costs, finance income, non-core income or expenses and
taxes.
The Company's results materials are
available to download from Nostrum's website:
Download: H1 2024 Results Presentation
Download: H1 2024 Interim Financial Report
LEI: 2138007VWEP4MM3J8B29
Further information
For further information please
visit https://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
Notifying person
Thomas Hartnett
Company Secretary
About Nostrum Oil &
Gas
Nostrum Oil & Gas PLC is an
independent mixed-asset energy company with world-class gas
processing facilities and export hub in north-west Kazakhstan. 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 which is operated by its wholly-owned
subsidiary Zhaikmunai LLP,
which is the sole holder of the
subsoil use rights with respect to the development
of the Chinarevskoye field. The Company also owns an 80% interest
in Positive Invest LLP, which holds the subsoil use rights for the
"Kamenskoe" and "Kamensko-Teplovsko-Tokarevskoe" areas in the West
Kazakhstan region (the Stepnoy Leopard Fields).
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.
