TIDMSIA
RNS Number : 2239W
Soco International PLC
31 July 2018
SOCO International plc
("SOCO" or the "Company" or, together with its subsidiaries, the
"Group")
TRADING AND OPERATIONS UPDATE
SOCO International, an international oil and gas exploration and
production company, issues the following trading and operations
update in advance of its Half Year Results due to be announced on
20 September 2018.
OPERATIONS UPDATE
VIETNAM PRODUCTION
Production for H1 2018 from the TGT and CNV fields net to the
Group's working interest averaged 7,772 barrels of oil equivalent
per day (BOEPD). TGT production for January-June averaged 20,565
BOEPD gross and 6,201 BOEPD net to SOCO. CNV production for
January-June averaged 6,287 BOEPD gross and 1,571 BOEPD net to
SOCO.
Production from the TGT and CNV fields in Vietnam is currently
lower than previous guidance. This is due to the delayed start-up
of drilling operations including the late arrival of a rig and
equipment delivery delays. A number of options are being reviewed
to complete the planned three to four well 2018 drilling programme
and therefore minimise the impact on production. Options under
consideration include running multiple rigs and revising the order
in which wells are drilled.
The operational delays do not impact on the fields' reservoirs
or resources and the Company's revised average production guidance
is 7,400 - 8,200 BOEPD for the remainder of 2018. SOCO will provide
updates on progress once options to optimise the 2018 work
programme are confirmed.
VIETNAM DEVELOPMENT
Block 9-2 - CNV Field
(25% interest; operated by HVJOC)
The Japan Drilling Company Hakuryu-II jack-up rig arrived at the
CNV-WHP to drill the CNV-5P side-track well on 19 June, but
operational issues in removing the existing completion string
delayed the start-up of side track drilling for 14 days. Once this
well is complete, the rig is expected to move to the H5-WHP located
in TGT.
Block 16-1 - TGT Field
(30.5% interest; operated by HLJOC)
A second jack-up rig, the PetroVietnam Drilling PVD-1, is
expected to drill from the H1-WHP. The arrival of this rig has been
delayed due to extended operations by its current contactor.
SOCO is also continuing to evaluate solutions to the compressor
issues encountered on the FPSO and is reviewing a selection of
technical alternatives prior to committing to an agreed solution.
The final negotiations for the extension to the FPSO Bare Boat
Charter have progressed well and are anticipated to be finalised in
the next month.
AFRICA PORTFOLIO
Marine XI Block, offshore Congo (Brazzaville) (40.39% working
interest, SOCO-operated) and Cabinda North Block, onshore Angola
(Non-operated, 22% working interest).
As announced on 25 June 2018, SOCO sold its interests in Congo
(Brazzaville). On 2 July 2018 SOCO announced it had entered into a
sale and purchase agreement (SPA) for the sale of the Group's
entire 80% shareholding in SOCO Cabinda Limited, the company
holding a 22 percent, non-operating, working interest in the
production sharing contract for the Cabinda North Block,
Angola.
As indicated in the announcement, the original long stop date
for satisfaction or, where applicable, waiver of the SPA conditions
was 31 July 2018. The parties to the SPA have agreed an extension
of this long stop date to 17 August 2018 to allow additional time
for receipt of the customary approvals required for completion. A
further update will be provided to the market in due course.
FINANCIAL UPDATE
Cash balances as at 30 June 2018 were approximately $130m with
revenues for January-June 2018 in excess of $93m. The average
realised oil price per barrel achieved for the same period was
circa $74/bbl, representing a premium of over $3/bbl to Brent.
A dividend of 5.25 pence per share for 2017 which amounts to
$23m, was approved at the AGM in June 2018 and paid on the 15 June
2018.
The capital expenditure budget for 2018 is likely to change
given the delays in the drilling activity noted above as some
expenditure may be deferred into 2019.
STRATEGIC UPDATE
SOCO remains committed to sustainable cash flow generation and
to annual returns to shareholders. With its sale of Marine XI, the
Company has retained a royalty interest on all future gross liquids
production to help underpin and support these objectives.
SOCO's Board continues to pursue new business opportunities in
line with its strict strategic, financial and operational
criteria.
ENQUIRIES:
SOCO International plc Tel: 020 7747 2000
Ed Story, President and Chief Executive Officer
Jann Brown, Managing Director and Chief Financial Officer
Mike Watts, Managing Director
Sharan Dhami, Group Investor Relations Manager
Camarco Tel: 020 3757 4980
Billy Clegg
Georgia Edmonds
Owen Roberts
NOTES TO EDITORS
SOCO is an international oil and gas exploration and production
company, headquartered in London and traded on the London Stock
Exchange. The Company has field development, production and
exploration interests in Vietnam. SOCO holds a 30.5% working
interest in the Te Giac Trang Field of Block 16-1, which is
operated by the Hoang Long Joint Operating Company. Block 16-1 is
located in the shallow water Cuu Long Basin, offshore southern
Vietnam. SOCO holds a 25% working interest in the Ca Ngu Vang field
of Block 9-2, which is operated by the Hoan Vu Joint Operating
Company. Block 9-2 is located in the shallow water Cuu Long Basin,
offshore southern Vietnam. SOCO holds a 70% interest in and is
designated operator of Blocks 125 & 126, located in the
moderate to deep water Phu Khanh Basin, offshore central
Vietnam.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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