TIDMTRIN
RNS Number : 4591N
Trinity Exploration & Production
09 August 2017
Dissemination of a Regulatory Announcement that contains inside
information according to REGULATION (EU) No 596/2014 (MAR).
Trinity Exploration & Production plc
("Trinity" or "the Group" or "the Company")
H1 2017 Operational Update and Notice of Results
Trinity, the independent E&P company focused on Trinidad and
Tobago today provides an update on its operations and financial
position for the six-month period ended 30 June 2017 in advance of
the Group's full Interim Results. The information contained herein
has not been externally reviewed and may be subject to
amendment.
H1 2017 Highlights (Unaudited)
-- A step-change in financial performance delivered during a period of transition
-- Continued upward trajectory in production expected during H2 2017
-- Supported by step-change in operating activities across core assets
-- Very robust consolidated operating netback for H1 of US$13.5/bbl (H1 2016: US$3.3/bbl)
-- Stronger balance sheet; H1 cash balance of US$11.5 million (H1 2016: US$5.1 million)
Key Metrics H1 2017 H1 2016 Change
(%)
Average net daily production
(bopd) 2,397 2,659 (10)
Average realised price (US$/bbl) 46.4 32.8 41
Revenues for the period (US$m) 20.1 16.1 25
Consolidated operating breakeven
(US$/bbl)1 32.8 29.5 11
Operating netback (US$/bbl)2 17.3 7.1 144
Consolidated operating netback
(US$/bbl)3 13.5 3.3 309
Cash Balance (US$m) 11.5 5.1 125
1. Consolidated operating break-even/bbl: Realised Price/bbl -
Consolidated operating netback/bbl
2. Operating netback/bbl: Realised price/bbl - Over-riding
Royalty/bbl - Production Royalty/bbl - Opex/bbl
3. Operating netback/bbl: Realised price/bbl - Over-riding
Royalty/bbl - Production Royalty/bbl - Opex/bbl - G&A/bbl
Operational Update
During the period (H1: January 1(st) - 30(th) June 2017) the
focus was on strengthening the foundations of the Company by;
maturing the pipeline of value-creating production growth
opportunities, enhancing asset integrity, and ensuring the
organisation is structured to deliver on our growth strategy.
Overall H1 production was impacted by a decline during Q2 2017.
This was primarily as a result of certain one-off production
shut-downs due to the Tropical Storm Bret and consequential
electrical supply disruptions across operations for the month of
June. During July production levels were restored and exceeded
2,500 bopd. A production run-rate of between 2,550 - 2,650 bopd is
expected during August with a continuing upward trajectory.
More Profitable Barrels/Production & Strengthened Balance
Sheet
H1 financials were strong, with operating costs ("OPEX") and
G&A coming in below budget, on a per barrel basis, despite the
production decline. The overall financial performance has yielded
an extremely robust consolidated operating netback of US$13.5/bbl
(after deducting Royalties, Opex and G&A) with a resulting
consolidated operating breakeven price of US$32.8/bbl.
The financial performance is a result of the rigorous management
of lifting costs/OPEX and G&A, facilitating stronger than
budgeted cash operating margins and a robust cash position of
US$11.5 million. Given the fixed cost nature of operations this
provides confidence in the Company's ability to leverage this
performance further with increasing production rates.
Outlook
The success of the RCP programme to date and the identification
of more locations from a targeted screening effort has allowed
Trinity to prioritise these lower cost/quicker payback
opportunities. As a result, an additional rig has been contracted
to execute an enlarged RCP programme. In parallel, workovers have
been accelerated, swabbing increased and more re-activations will
be undertaken.
The H2 2017 focus is on the delivery of production growth from
the parallel activity sets described above and in the AGM statement
dated 23 June 2017. These activities should enable production
guidance (2,600 bopd - 2,800 bopd annual average for 2017) to be
achieved from this lower cost yet higher economic activity set.
The new infill targets are drill ready with work continuing on
expanding the drilling options technically as well as completing
the supply chain and the regulatory approval process. H2 will also
see continued focus on planned key infrastructure projects to
support and sustain production growth. These combined activities
provide scope to grow production from current levels to a target
run-rate of approximately 3,000 bopd within 12 months.
Simultaneously, work continues on maturing development plans to
deliver a further, more material, step-change in production in the
medium term. This includes sub surface and engineering activities
on the Trintes Field and the Galeota Ridge development including
the TGAL area.
Given the combination of strong cash balances and operating cash
generation the Board remains confident in the Company's ability to
grow production levels whilst rapidly paying down remaining debts.
Looking ahead beyond 2017 the Company will continue to grow
production and development opportunities both onshore and offshore
with the aim of achieving a further material step-change in
production in the medium term.
Notice of Results
The Company intends to announce full interim period results for
the six-month period ended 30 June 2017 on Monday 25 September
2017.
Bruce Dingwall, CBE, Executive Chairman of Trinity,
commented:
"Trinity has a clear strategic focus going forward, which is to
grow our reserves and production to maximise the cash flow from our
core assets while achieving a market value that is more reflective
of our underlying assets. This will be delivered through financial
discipline, the efficient deployment of capital and by delivering
on the potential of our diverse and deep portfolio of low-cost
production and development assets.
"I must thank all our staff and stakeholders for their hard work
and support through this period of significant operational
preparation and activity.
"We look forward with confidence and will provide a further
update alongside our interim results."
Competent Person's Statement
The information contained in this announcement has been reviewed
and approved by Graham Stuart, the Company's Technical Advisor who
has 34 years of relevant global experience in the oil industry. Mr.
Stuart holds a BSC (Hons) in Geology. Reserves and resources in
this announcement are based on internal management estimates in
accordance with SPE PRMS guidelines (Petroleum Resources Management
System 2007 & Revisions).
Enquiries:
Trinity Exploration & Production Tel: +44 (0)
131 240 3860
Bruce Dingwall, Executive Chairman
Tracy Mackenzie, Head of Corporate
Development
SPARK Advisory Partners Limited Tel: +44 (0)
(Nominated & Financial Adviser) 20 3368 3550
Mark Brady
Miriam Greenwood
Sean Wyndham-Quin
Cantor Fitzgerald Europe (Broker) Tel: +44 (0)
20 7894 7000
David Porter
Sebastien Maurin
Walbrook PR Limited trinityexploration@walbrookpr.com
or Tel: +44 (0) 20 7933 8780
Nick Rome
About Trinity (www.trinityexploration.com)
Trinity is an independent oil and gas exploration and production
company focused solely on Trinidad and Tobago. Trinity operates
producing and development assets both onshore and offshore, in the
shallow water West and East Coasts of Trinidad. Trinity's portfolio
includes current production, significant near-term production
growth opportunities from low risk developments and multiple
exploration prospects with the potential to deliver meaningful
reserves/resources growth. The Company operates all of its nine
licences and, across all of the Group's assets, management's
estimate of 2P reserves as at the end of 2016 was 21.3 mmbbls
(excluding the Guapo-1 license which was disposed of in April
2016). Group 2C contingent resources are estimated to be 21.1
mmbbls. The Group's overall 2P plus 2C volumes are therefore 42.3
mmbbls.
Trinity is listed on the AIM market of the London Stock Exchange
under the ticker TRIN.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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