28th Mar 2019 09:53
LONDON (Alliance News) - Hurricane Energy PLC is looking at "significant" cash flow in 2019, it said on Thursday, as it approaches first oil in the UK North Sea.
During 2018, Hurricane completed a "substantial" floating production and storage vessel upgrade at the Lancaster field, as well as offshore installation work.
Lancaster is on track and budget to produce during the first half of 2019, and once ramped up it will produce around 17,000 barrels of oil per day. After six months, the two wells could then produce up to 10,000 barrels a day each.
This, Hurricane said, will generate over USD200 million in operating cash flow a year based on a USD60 per barrel Brent price.
Hurricane posted a pretax loss of USD60.9 million in 2018, it said Thursday, after a USD7.0 million loss in 2017.
This comes due to a significant swing to a fair value loss on derivative financial instruments, despite no impairments in 2018.
Hurricane does not yet produce any revenue, ahead of first oil from Lancaster.
"With first oil from the Lancaster early production system and a three well drilling programme on the greater Lancaster area, we look forward to another exciting period for Hurricane in 2019 as we advance our strategy of de-risking and monetising the substantial resources in our Rona Ridge portfolio," said Chief Executive Robert Trice.
Hurricane signed a USD387 million 50% farm-in with Spirit Energy, owned by Centrica PLC, as the two look to develop the greater Warwick area in the North Sea, which holds gross reserves of around 500 million barrels.
Three wells are planned at Warwick in 2019, with the first to be spud in April.
Hurricane shares were 0.6% higher on Thursday at a price of 47.24 pence each.
Related Shares:
HUR.L