18th Sep 2013 07:42
LONDON (Alliance News) - Eland Oil & Gas PLC Wednesday said its pretax losses doubled in its first half as it increased costs towards first production.
The Scottish exploratory oil and gas company, with operations primarily in West Africa, said its pretax losses grew to USD11.0 million from USD5.4 million for the six months ended June 30.
The company, which is yet to make any revenues, said its operating loss widened to USD10.5 million from USD4.5 million as the company invested in new staff and conducted 2D and 3D seismic tests in preparation to start production at its Opuama Field in Nigeria.
Eland said it expects first oil production to start in October and hopes to achieve rapid production growth, adding it anticipates a rate of about 3,000 barrels of oil per day for each scheduled new well. The company said year-end production rate is expected to be in the range of 2,500 to 5,500 barrels of oil per day.
The Opuama Field was controlled by Shell from 1964 and was in production between 1975 and 2006, when it was shut down due to nationwide security concerns. Eland gained an interest in the field in March 2011.
During the recent half-year, Eland took out a debt facility of USD22 million from Standard Chartered Bank and negotiated two GBP10 million equity options with key shareholders to increase company funding to develop towards production.
"We have worked hard to achieve this in close co-operation with the operator of OML 40, NPDC, and look forward to the start of oil production in October. We will then turn our attention to the development drilling programme, for which we have a rig identified, and the task of building our production revenues over the long term," Chief Executive Leslie Blair said in a statement.
Eland shares were flat in early trading Wednesday at 113.75 pence.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Eland Oil & Gas