23rd Apr 2015 09:08
LONDON (Alliance News) - Zoltav Resources Inc Thursday reported its maiden revenue and a USD35.0 million gain related to the acquisition of the company's main Bortovoy licence, which together swung Zoltav to a substantial pretax profit in 2014.
The oil and gas company focused on Russia reported maiden revenue during the year of just over USD20.0 million which helped swing the company to a pretax profit of USD24.1 million in 2014 from a USD4.4 million loss a year earlier.
However, the profit was mainly caused by a USD35.0 million gain from the acquisition of Royal Atlantic Energy in December 2013, which included the company's producing Bortovoy licence. Zoltav acquired Royal Atlantic from Bandbear Ltd for USD180 million, and said USD35.0 million in negative goodwill was booked due to the initial acquisition of the assets by Bandbear following the administration of the former owner and the related party nature of the transaction. That negative goodwill has has now been reversed.
Before the USD35.0 million gain, the company made a pretax loss of USD7.6 million. The company did not book any exceptional items in 2013.
"2014 was the year in which Zoltav became a producing oil and gas business. Activity during the year was dominated by two significant projects: the acquisition and integration of the Bortovoy Licence and operating assets in the Saratov Oblast; and the seismic acquisition and well-testing programmes on the Koltogor Licences in Khantiy-Mansisk, West Siberia," said Executive Chairman Alastair Ferguson.
"With the completion of the acquisition of the Bortovoy Licence and the integration of this asset into the company, our focus there is on ensuring that the Western Gas Plant continues to produce at full capacity and that the Western Fields are developed efficiently and effectively; while concurrently developing an appraisal strategy for the highly prospective Eastern Fields of the licence," he added.
In 2014, Zoltav produced 7,656 barrels of oil equivalent per day, comprising of 40.2 million cubic feet of gas and 478 barrels of oil and condensate. The company expects production rates to be maintained at approximately 48.4 million cubic feet per day in 2015.
At the end of the period, the company had cash of USD10.7 million.
"We continue to seek opportunities for growth, both organically and through acquisition in our core areas of Russia and the Commonwealth of Independent States, and we anticipate a significant amount of our effort to be focused on this during 2015," said Ferguson.
Zoltav shares rose by 0.6% to 45.75 pence per share on Thursday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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