25th Sep 2014 09:59
LONDON (Alliance News) - Zoltav Resources Inc Thursday reported maiden revenues following its acquisition of the Bortovoy license in Russia, and expects to see the full benefits of its operations from the beginning of next year as it increases gas production.
The company reported maiden revenues of USD1.6 million for the six months ended June 30, generated from 13 days' production from the Bortovoy licence, which it inherited following the acquisition of Royal Atlantic Energy (Cyprus) Ltd, whose subsidiary, Diall Alliance, holds and operates the licence.
The maiden revenue swung Zoltav to a pretax profit of USD27,490 for first-half of 2014, compared to a USD2,302 loss in the comparable period in 2013.
Cash resources and undrawn facilities at June 30 were USD21.3 million.
Focus has been on restoring the western gas plant, based in the Borovoy license on the border of Russia and Kazakhstan, to its full production capacity of 14.2 billion cubic feet per annum by June 2015.
"With the acquisition of the Bortovoy Licence now complete, our focus there is on operations and in particular on ensuring that the western gas plant is operating at full capacity; while concurrently developing an appraisal strategy for the highly prospective eastern fields," said Executive Chairman Symon Drake-Brockman.
It will utilise cash flows from existing operations to fund the further development of the Karpenskoye field and the tie in of the Zhdanovskoye field on the license to the western plant in order to ensure that the western plant is operating at full capacity, it said.
"As a result of the company's investment programme to bring the western gas plant at Bortovoy up to full capacity, the company expects to see a small increase in production rates in the second half of 2014 as compared to the plant's performance in the first half; with the full impact of maximum capacity beginning in January 2015," said Finance Director Alistair Stobie.
While revenue from gas production are expected to increase, sales of oil and condensate are expected to continue to decline as the oil reservoirs on its Karpenskoye field reach the end of their life, added the company.
"The first half of 2014 saw a significant corporate milestone in the recording of Zoltav's first revenues from 13 days of gas and oil production," said Drake-Brockman.
Zoltav's shares were down 2.2% to 85.60 pence per share Thursday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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