1st Apr 2015 07:23
LONDON (Alliance News) - Amerisur Resources PLC shares dropped on Wednesday after it said its reserves and resources for its exploration and production assets in Colombia and Paraguay fell following an independent reserves report undertaken by Petrotech Engineering Ltd.
Amerisur shares were down 19.2% to 24.25 pence per share on Wednesday morning, one of the worst performers in the AIM All-Share.
The report concluded that the company's proven gross field reserves fell to 16.2 million barrels of oil from 19.8 million barrels in 2013 whilst proven plus probable gross field reserves fell to 24.6 million barrels from 32.8 million barrels.
The 6% reduction in proven reserves comes after the company produced 2.3 million barrels of oil in 2014.
Amerisur said the reduction is also due to the "relatively poor initial production results" from Platanillo 15 and Platanillo 16, which lowered the amount the company is expected to recover from its reserves.
Additionally, the shut-ins of producing wells due to social and export issues during the year resulted in lower average production rates which also caused an increase in the future projected decline rate, resulting in lower overall volumes being recovered in the company's model.
Reserves have also been impacted by the board's responsible decision to reduce drilling activity in order to ensure capital expenditure at Amerisur is matched by cash flows in the current lower oil price environment.
"The technical reduction this year is owed to certain factors which, once full production can be re-established and stabilised with the entry of the export flow line later this year, can be recovered within the reserves model," said the company.
By Joshua Warner; [email protected]; @JoshAlliance
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