Xcite Energy Limited 3rd Quarter Results (5057G)
November 23 2015 - 1:00AM
UK Regulatory
TIDMXEL
RNS Number : 5057G
Xcite Energy Limited
23 November 2015
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART
DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO
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LSE-AIM: XEL
23 November 2015
Xcite Energy Limited
("Xcite Energy" or the "Company")
Third Quarter Results for the 3 and 9 Month Periods Ended 30
September 2015
Xcite Energy announces its third quarter results for the 3 and 9
month periods ended 30 September 2015.
Highlights for the year to date
-- Continuing diligence and discussions with potential field partners and funders.
-- Continue with a technical assessment of the Bentley
development concept with the Oil & Gas Authority.
-- Agreement to farm-out an interest in the P.1979 Licence to Azinor Catalyst.
-- Increase in 1P, 2P and 3P heavy oil reserves for the Bentley
field to 234 MMstb, 265 MMstb and 296 MMstb, respectively,
effective 31 December 2014 and based on an expected initial 35 year
production period.
-- NPV10 (after tax) value of reserves for the Bentley field of
approximately US$1.9 billion, US$2.3 billion and US$2.6 billion on
a 1P, 2P and 3P basis, respectively, effective 31 December
2014.
-- Net loss in the third quarter of US$0.3 million.
-- Cash balance of US$27.9 million as at 30 September 2015.
Overview of Results
In its second quarter results, the Company provided some
background to the current industry environment and explained some
of the challenges it faced in securing development partners and the
financing required to develop the Bentley oil field. As would be
expected, with the oil price remaining at low levels, this backdrop
remains materially the same. However, there is continuing evidence
that costs across the industry are falling and are adjusting to the
low oil price environment, and we are working to update and
incorporate revised estimates into our development cost base.
The Company and the Oil and Gas Authority ("OGA") have committed
a significant amount of time over the past few months to a
technical review of the Bentley field development concept. Earlier
in the year, the OGA identified the Bentley field development as
one of its top commercial priorities, following which Xcite Energy
and the OGA have undertaken a detailed assessment of the key
technical aspects of the proposed development, including reservoir
management, drilling and well engineering, asset management and
operatorship, and a Stakeholder review by the key regulators.
Concurrent with this activity, the Company continues to engage
with potential development partners and other potential sources of
funding that are required to develop the Bentley oil field,
including the asset financing for the principal assets, the MOPU
and the FSO, and to repay the June 2016 Bonds in accordance with
their terms. Technical and economic due diligence has been
completed by a potential partner, which has enabled progression to
commercial discussions. However, the Company believes it is prudent
to keep all options open and therefore remains very actively
engaged with a wide range of parties in order to maximise the
opportunity to secure the required funding. Construction of the N
Plus class drilling rig continues to make good progress in
Singapore.
Separately, the Company recently announced a farm-in agreement
with Azinor Catalyst Limited ("Azinor") to undertake a technical
assessment on Licence P.1979, at its own cost, which covers Blocks
9/4a, 9/8b, and 9/9h containing the Clement, Chadwick, Cartwright
and Camm prospects, in return for the right to 40% equity in the
Licence. This could be increased by a further 10% equity in the
Licence if both parties see additional value in undertaking an
Induced Polarization survey (as a potential hydrocarbon indicator),
with Azinor being responsible for all costs of the survey, if
conducted. This agreement enables Xcite Energy to continue to focus
on Bentley, whilst benefitting from the technical and quantitative
interpretation techniques and integrated subsurface modelling
provided by Azinor, to further delineate and de-risk the prospects
identified by Xcite Energy, so that it can meet its obligations
under the Licence.
As part of its regular economic review cycle, the Company's
voluntary de-listing from the TSX-V was completed at the close of
trading on 30 September 2015, which it believed to be necessary, as
trading had declined on the Canadian market to negligible levels
and the associated legal, compliance and administrative costs
significantly outweighed the benefits of the dual listing. The
Company's continuing listing on the AIM market provides sufficient
liquidity and simplified administration going forward.
The following tables summarise the financial performance of the
Company and its wholly owned subsidiary, Xcite Energy Resources
plc, in the 3 and 9 month periods ended 30 September 2015 and,
following a change in presentation currency from 1 January 2015,
the restated US Dollar comparatives for the 3 and 9 month periods
ended 30 September 2014 and the restated Statement of Financial
Position as at 31 December 2014.
9 months ended 3 months ended 9 months ended 3 months ended
30 Sept 30 Sept 30 Sept 30 Sept
----------------------------------------------- --------------- --------------- --------------- ---------------
Income Statement Information 2015 2015 2014 2014
----------------------------------------------- --------------- --------------- --------------- ---------------
US$m US$m US$m US$m
----------------------------------------------- --------------- --------------- --------------- ---------------
Net loss (1.1) (0.3) (3.5) (4.3)
----------------------------------------------- --------------- --------------- --------------- ---------------
Basic and diluted earnings per share in cents (0.4) (0.1) (1.2) (1.5)
----------------------------------------------- --------------- --------------- --------------- ---------------
9 months ended 3 months ended 9 months ended 3 months ended
30 Sept 30 Sept 30 Sept 30 Sept
----------------------------------------- --------------- --------------- --------------- ---------------
Cash Flow Information 2015 2015 2014 2014
----------------------------------------- --------------- --------------- --------------- ---------------
US$m US$m US$m US$m
----------------------------------------- --------------- --------------- --------------- ---------------
Net cash flow from operations 6.6 3.3 12.1 1.7
----------------------------------------- --------------- --------------- --------------- ---------------
Net cash flow from investing activities (29.1) (9.7) (26.1) (4.9)
----------------------------------------- --------------- --------------- --------------- ---------------
Net cash flow from financing activities - - 46.7 0.3
----------------------------------------- --------------- --------------- --------------- ---------------
As at As at As at
30 Sept 31 December 30 Sept
--------------------------------------------- --------- ------------- ---------
Statement of Financial Position Information 2015 2014 2014
--------------------------------------------- --------- ------------- ---------
US$m US$m US$m
--------------------------------------------- --------- ------------- ---------
Total assets 488.6 482.2 498.8
--------------------------------------------- --------- ------------- ---------
Cash and cash equivalents 27.9 50.4 62.8
--------------------------------------------- --------- ------------- ---------
Current liabilities 136.3 5.5 126.3
--------------------------------------------- --------- ------------- ---------
Long term liabilities 2.4 125.8 4.0
--------------------------------------------- --------- ------------- ---------
Total net assets 349.8 350.9 368.5
--------------------------------------------- --------- ------------- ---------
The Company's unaudited Consolidated Financial Results for the 3
and 9 month periods ended 30 September 2015 can be found at the
following link:
http://www.rns-pdf.londonstockexchange.com/rns/5057G_-2015-11-20.pdf
Forward-Looking Statements
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