29th Apr 2015 10:10
LONDON (Alliance News) - Sterling Energy PLC Wednesday said it swung to a post-tax loss in the first quarter of the year as revenue because of reduced lifting of oil barrels and production alongside lower oil prices.
In the first quarter of 2015, Sterling reported a USD815,000 loss after tax, swinging from a USD489,000 profit a year earlier, due to a reduced lifting of 30,258 barrels in the first quarter from 31,282 barrels a year earlier, alongside a significantly lower realised oil price and lower production levels which saw revenue halve to USD1.7 million from USD3.5 million.
The upstream oil and gas company said net production in the quarter to the company, including royalty barrels from the Chinguetti field offshore the Mauritanian coast, averaged 382 barrels of oil per day, down from 400 barrels per day a year earlier.
The loss before interest, tax, depreciation, amortisation, finance income and expense, provisions and write-offs totalled USD878,000 from a USD2.1 million profit a year earlier. The loss also excludes pre-license awards, exploration costs and share based payments.
At the end of the period, Sterling reported a cash balance of USD117.0 million in addition to USD10.9 million of partner funds.
Operationally, Sterling said it is interpreting and incorporating the 2D data from its PSC C-3 operations which will allow a decision on entering phase two of operations, which includes a commitment to acquire a 700 kilometre squared 3D seismic and the drilling of one exploration well. PSC C-3 is located in shallow water within the Nouakchott sub-basin, offshore Mauritania.
No further development of the company's sole producing Chinguetti field is planned.
Operational activities in Somaliland have been delayed while the government establishes a trained and equipped oilfield protection unit that can provide the level of security required by in-country operators to ensure all future seismic and drilling operations can be conducted safely, said Sterling.
In Madagascar, Sterling said the operators are not planning on drilling any exploration wells in 2015 or 2016. The operators are currently holding discussions with the Office des Mines Nationales et des Industries Stratégiques about the forward work programme in the country.
"The company is actively pursuing exploration new venture growth options, focusing primarily on sub-Saharan Africa. Additionally, the company continually evaluates opportunities outside of this core focus area, utilising its full in-house capability set," said the company.
Sterling shares were up 0.3% to 17.30 pence per share on Wednesday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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