Corporate Update
Brisbane, Sep 4, 2015 AEST (ABN Newswire) - Pryme Energy Limited (Pryme) (
ASX:PYM) (POGLY:OTCMKTS) is pleased to announce that during the June 2015 half year the Company more than doubled its oil and gas production, on a barrel of oil equivalent basis, over the previous half year and, importantly, increased oil production by 260%. The Company currently generates production and cash flow from its Capitola Oil Project in Texas as well as from its long-term holdings in Louisiana. The combined production from these projects nets Pryme approximately 105 Bbls/day of oil and 155 Mcf/day of natural gas.
HIGHLIGHTS
Pryme is cash flow positive at current oil prices and production rates
Oil production increased by 260% over the prior half year
Board and executive management costs reduced by 32%
During 2015 the Board and management team have reduced the administration and operating cash costs of the Company from the 2014 levels. At current production levels and commodity prices the Company is administratively and operationally cash flow positive moving forward, while preserving a strong cash balance of approximately A$3.4 million. As part of the cost reduction effort the Chairman and Executive Directors have voluntarily reduced their remuneration by 32%.
The enclosed slide illustrates Pryme's cash costs versus revenue relative to its ASX listed peers comprising 210 companies in the Energy GICS sector with market capitalisation less than $50 million. Of the 210 comparable companies, Pryme is one of only 23 companies producing maintainable revenue and one of only 16 companies with revenue in excess of cash operating costs. This demonstrates that the Company outperforms more than 92% of comparable companies with respect to prudent cost management and its costs are materially below the average of comparable ASX listed peers in the Energy GICS sector.
Pryme remains committed to executing its corporate strategy of focusing on high quality exploration projects offering significant scalability of production, cash flows and reserves. The Capitola Oil project continues to produce a 30 day average of around 114 Bbls/day (85 Bbls/day net to Pryme) and 207 Mcfd (155 Mcf/day net to Pryme) of natural gas and is strongly cash positive. The Newkirk Project, which the company has secured in the Mississippi Lime fairway in Oklahoma and is based on 2,320 net acres and an operating agreement with an established operator, has very attractive, low risk and profitable development potential.
The focus for the balance of 2015 will be to continue the low cost optimisation of production from Capitola, to expand the area under its control in the Newkirk project if cost-effective and, subject to improvement in commodity prices, to drill low-cost, low risk, vertical wells in the Mississippi Lime utilising completion methods successfully developed by other operators in the region over the past 5 years.
"The transition to being cash flow positive is a significant accomplishment in this low commodity price environment and reflects well on the cost reduction efforts of management through the year to date," said George Lloyd, Pryme's Chairman. "Low commodity prices have also enabled Pryme's management team to inexpensively access development opportunities which would not otherwise be available. We expect these to generate significant value for the company moving forward."
To view figures, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-PYM-877511.pdf
About Indago Energy Ltd
Indago Energy Ltd (ASX:INK) (OTCMKTS:POGLY) is an Australian listed company engaged in oil and gas exploration, development and production. Indago's project portfolio includes liquid rich producing assets together with substantial oil development and exploration acreage in the United States.
The Company's Exploration and Production focus is on high growth oil and gas projects offering scalability of production, cash flows and reserves. Indago currently has several producing projects together with a significant acreage position. The Company's immediate focus is the development of its Capitola Oil Project located in an active region of the Cline Shale resource play along the Eastern Shelf of the Permian Basin, Texas. The project's core development and exploitation opportunities are shallower multiple "stacked" sandstones and limestones to depths of 7,000 feet which are effectively produced from vertically drilled wells. Indago's value driven model is executed through exploiting shallower, well defined intervals with advanced completion and stimulation technology within known produced oil fields together with exposure to the emerging Cline Shale resource play.
Indago's shares are publicly traded on the Australian Securities Exchange (ASX ticker: INK) and also as American Depositary Receipts on the OTCQX (ADR ticker: POGLY).
| ||
|
