16th May 2019 09:09
LONDON (Alliance News) - Premier Oil PLC said Thursday surprisingly strong production so far this year, thanks to a "very high group operating efficiency", has led the company to increase its guidance for 2019.
Premier Oil shares were up 6.9% at 97.00 pence Thursday morning.
Premier's production was 85,100 barrels of oil equivalent in the year to Wednesday, 14% higher than the same period last year. That was due to a "very high group operating efficiency" of 97%, the company said.
UK production averaged 57,4000 barrel of oil equivalent per day, up 47% on the corresponding period in 2018, driven by an increased contribution from Catcher Area, in the UK North Sea. The Catcher Area is located off the coast of Aberdeen, and Premier is the operator of the area with a 50% stake.
As a result of the surprisingly strong production, Premier Oil has increased its full-year production guidance from 75,000 boe per day to 75,000 to 80,000. Meanwhile the guidance for expenditures remained unchanged.
The company also said that its next UK project, Tolmount, is progressing to schedule and that it had received positive results from the Block 7 Zama appraisal campaign, offshore Mexico.
Net debt has been reduced to USD2.25 billion as of the end of April. The forecast for 2019 is a net debt reduction at the upper end of its USD250 million to USD350 million guidance.
"We continue to deliver ahead of plan. Production and free cash flow are ahead of forecast for 2019 and, consequently, we are reducing our debt faster than anticipated. At the same time, we are making good progress on our growth projects. We look forward to concluding the Zama appraisal campaign and to spudding Tolmount East, which has the potential to deliver a step change in value to the already high return Tolmount Main project", said Chief Executive Tony Durrant.
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