27 Sep 2016
Sirius Petroleum (AIM:SRSP), the investing Company focused on oil and gas development and production opportunities in Nigeria, announces its interim results for the six month period ended 30 June 2016.
Read the full report here.
The interim results for the six month period ended 30 June 2016 reflect the costs incurred during the period to continue our evaluation work on the Ororo Field, in collaboration with our Technical Advisors, Havoc Partners and our Nigerian partners, Owena Oil & Gas and Guarantee Petroleum, and our London and Nigerian operations as we progress our Project Funding discussions in relation to drilling the Ororo-2 well.
The operating loss in the half year amounted to $698,000, a significant reduction of $864,000 on the six months to 30 June 2015 operating loss of $1,562,000, (year to 31 December 2015: $3,215,000) giving a loss per share of 0.04 cents (30 June 2015: 0.19 cents, 31 December 2015 0.30 cents).
During the period the Company issued 166,666,667 new ordinary shares of 0.25p each at 0.3p, raising £500,000 before expenses. Since the period end the Company has issued a further 200,000,000 new ordinary shares of 0.25p each at 0.25p, raising a further £500,000 before expenses. The Company has also entered into a convertible loan agreement since the period end for £500,000. The loan is for a term of one year and accrues 10% interest.
International oil service providers are offering turn-key services, equipment and personnel to finance low-risk development projects. The Board has now received a further two proposals from multinational service providers following the Company’s initial vendor finance proposal. This competitive process will create the most efficient structure and pricing for the drilling of the Ororo field.
On 8 September, Sirius announced the results of a Competent Person’s Report (CPR) on the Ororo Field, which was produced by independent petroleum consultants, Rockflow Resources Limited (“Rockflow”). The report confirmed a Mid Case Net Present Value (NPV10) of the asset of $49.2m, based on a $50 per barrel flat real oil price for life of field. The scenario would generate peak oil production of 6,000 stb/d and peak gas production at 25 MMScfd, which equates to combined peak production at 10,310 barrels of oil equivalent per day (boepd).
The High Case confirmed significant potential which exists on the field located in a world-class petroleum system. A summary of this report is available on our website under Reports & Publications in the Investor Relations section.
Rockflow produced an updated cash flow model in relation to the Ororo Field and in light of the current oil price, the decline of rig rates, and reduction of development costs, the economic cut off of the project is $27/bbl, which is substantially lower than today’s oil price.
In conclusion, the Directors believe that Sirius is well positioned to conclude its Project Funding given the underlying quality of the Ororo asset, the recent fundraise and the progress made with Guarantee Petroleum and Owena Oil & Gas in relation to moving forward with the preparatory work on the Ororo Field.
The Annual General Meeting will be held at 10.00 am on Thursday, 17 November 2016 at the offices of Fladgate LLP, 16 Great Queen Street, London, WC2B 5DG. A Notice convening the meeting will be sent separately to shareholders shortly, and an announcement will be made when this has been done.
26 September 2016
Read the full report here.