14th Jun 2016 10:40
LONDON (Alliance News) - LGO Energy PLC on Tuesday said it has reached an agreement on the terms of its Trinidadian subsidiary's loan with its lending bank BNP Paribas, which will free up an extra USD537,000 for the subsidiary to further its projects.
LGO said it has agreed to pay BNP Paribas USD896,000 as an accelerated repayment on the loan, outstanding to its subsidiary Goudron E&P Ltd, which includes the scheduled July 2016 and August 2016 payments, as well as a further prepayment of USD217,000.
In exchange, Goudron will receive the USD537,000 in Trinidadian dollars, LGO said, which it will be able to use in its Goudron field in Eastern Trinidad, where five further completion opportunities for wells have been prepared.
LGO said following the payments, the net loan outstanding to BNP will stand at USD3.4 million.
Goudron completed two of the targets on the Goudron field earlier this year with positive results, LGO said, noting that additional funding will allow that program of re-completions to be continued over the next few months at a rate of approximately two wells per month.
Approvals for re-completion work are being sought on a well by well basis and further announcements will be made as the program proceeds, LGO added.
Production at the Goudron field for the month of May is estimates to be around 430 barrels of oil per day, 8.0% higher than in April, resulting from the re-completion work carries out to date and increased downhole maintenance.
"LGO continues to work closely with BNP to ensure the optimum deployment of capital to production operations. As previously announced we anticipate commencing a program of drilling new Mayaro Sandstone wells as funding becomes available," said LGO Chief Executive Neil Ritson.
"We have identified up to 70 low risk infill targets in the shallow Mayaro sands that will greatly increase production whilst we complete the planning for the long term water flood enhanced oil recovery project on the deeper C-sands. In the interim, the re-completion of further legacy wells and the opening for production of intervals in wells drilled in 2014 and 2015 will further enhance returns," Ritson added.
Shares in LGO were down 4.2% at 0.172 pence on Tuesday.
By Hannah Boland; [email protected]; @Hannaheboland
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
LGO.L