3rd Mar 2020 12:07
(Alliance News) - President Energy PLC on Tuesday said work on a connecting gas pipeline between its Puesto Prado and Las Bases facilities in the Rio Negro province of Argentina has completed on time and on budget.
The new 16 kilometre pipeline section, along with associated infrastructure, is now in operation, allowing more gas to flow through the company's total 70 kilometre pipeline to market. No incidents occurred during the construction, which cost around USD5 million and is to be funded using President's current cash flows.
Moreover, the company said net gas production at its Estancia Vieja field, also in Rio Negro, is being ramped up with gas flowing to market at a higher volume than any time before at the field, thanks to the new pipeline.
When the ramp-up completes, likely in the next few days, another gas production volume announcement will be made. Current projections for the increased gas production match previously announced estimates of around 1,200 barrels of oil equivalent per day.
With installation of a larger scale compressor, and opening up of more Estancia Vieja shut-in wells expected in the second quarter of the year, group production is set to rise by another 800 boepd to give total gas production, on or near the end of the first half, of about 2,000 boepd from President's Neuquen basin assets.
This would give aggregate oil and gas production net to President of 4,000 boepd, excluding upcoming drill results in Argentina in the second half.
So far, the coronavirus outbreak in China, which quickly spread elsewhere, has not altered gas prices in Argentina "in any way". President's gas is sold for domestic consumption in Argentina.
Chait Peter Levine said: "The story of the first half of 2020 is all about gas. The necessary base infrastructure in Rio Negro is now in place and it is a tribute to, and reflective of, the depth of management and employees of our Argentina operations that this has been effected safely, on time and on budget.
"President is now a much more balanced energy company from a year ago as we continue our strategy of growth both organically and by way of appropriate value enhancing acquisitions.
"We move on to planning our 2020 drilling campaign and will provide further information on this in due course."
Shares in President Energy were up 1.5% at 3.40 pence in London on Tuesday.
By Anna Farley; annafarley@alliancenews.com
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