23rd Mar 2015 17:31
LONDON (Alliance News) - Baron Oil said Monday that Bill Colvin has been confirmed as chairman and chief executive on a permanent basis following the death of Rudolph Berends in January.
Colvin has been carrying out these roles on an interim basis since early January. He will receive a salary of GBP170,000 per annum and has been granted options over 35.2 million shares at an exercise price of 1.45p per share from March 23, 2018 onward.
Shares in the Latin America-focused oil explorer closed down 6.1% at 0.752p Monday.
The company noted it has cash balances of GBP800,000 in sterling and USD6.6 million in dollars. It also has additional USD3.1 million due from from Vale and Union Oil for the residual farm-out activity in Peru on Blocks XXI and Z-34. Baron said it expects to receive this cash later this year.
"We all miss Rudolph but we will continue to build on the great work he did both in farming-out Block Z-34 and generating significant amounts of cash for investment in the Latin American exploration sector, a sector that he believed in passionately," Colvin said.
"Progress in our exploration efforts in Peru has been slower than we would all have liked, but we are using the extra time to analyse our existing data and acreage to design the most cost-effective seismic programme," he said.
The company noted only one well in the Nancy field in Colombia is producing, at 400 barrels per day. The wells in the Burdine field have been shut in, as operating costs were running in excess of USD100 per barrel, well above world oil prices.
Baron has a 29.5% interest in the NBM field. "The commercial terms on this field production must improve to make this field economic for any third party to operate past the licence expiry date in October 2015," Baron Oil said.
It said its interests in Peru either remain in Force Majeure or are awaiting regulatory approvals.
"I want to preserve our scarce cash resources as much as possible, as I believe the company will have several potential investment opportunities available to it in the current lower commodity price environment," Colvin said.
Baron Oil shares closed down 6.06% at 0.752 pence Monday evening.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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