Europa Oil & Gas announces interim results
Tuesday, Apr 04, 2017
Europa Oil & Gas (Holdings) plc, the AIM traded Ireland and UK focused oil and gas exploration, development and production company, announces its interim results for the six month period ended 31 January 2017.

Operational highlights

  • Extension of phase 1 of Irish South Porcupine Basin licences FEL 2/13 and FEL 3/13 to 4 July 2017 to enable existing prospects to be matured and detailed mapping performed of all potential prospective levels
  • Constructive discussions with a number of large oil companies in respect of farm-out of Europa’s Irish acreage – discussions are ongoing with a number of parties and the Company has concluded one farm-out to Cairn Energy plc, as detailed below
  • Sale of 3.34% interest in PEDL180 & 182 (Wressle) to Union Jack Oil plc (“Union Jack”) for £0.6 million in cash
  • Agreed sale (conditional on planning approval) of 10% interest in PEDL180 & 182 (Wressle) to Upland Resources (UK Onshore) Limited (“Upland”) for up to £1.85 million - £1.3 million in cash, £0.3 million in Upland shares and a contingent consideration of £0.25 million in Upland shares
  • Acquisition of Shale Petroleum (UK) Limited (“Shale Petroleum”), increasing Europa’s interest in PEDL299 (Hardstoft) and PEDL343 (Cloughton)
  • Wressle planning decision has delayed the start of production pending appeal

Post reporting period events

  • Farm-out of 70% interest in LO 16/19 in the South Porcupine Basin offshore Ireland to Cairn Energy plc which will fully fund a US$6 million work programme in summer 2017 including 3D seismic acquisition
  • Farm-out of 12.5% interest in PEDL143 (Holmwood) to Angus Energy – Europa retains 20% interest and is carried on well costs up to a cap of £3.2 million

Financial performance

  • Revenue £0.8 million (H1 2016: £0.6 million)
  • Pre-tax loss of £0.2 million, (H1 2016: pre-tax tax loss of £0.6 million)
  • Net cash used in operating activities £0.3 million (H1 2016: cash used £0.5 million)
  • Reduction in administrative expenses to £218,000 (H1 2016: £355,000)
  • Cash balance at 31 January 2017 £1.4 million (31 July 2016: £1.7 million)
Europa’s CEO, Hugh Mackay said, “Since the beginning of the financial year, a number of farm-outs and sales have been signed across our licence base raising non-dilutive capital for Europa. The remainder of 2017 will see Europa participate in high impact development and exploration projects for which our share of the costs is now funded.

“Offshore Ireland, following our farm-out, 3D seismic will be acquired and funded by Cairn on LO 16/19 in the Irish Atlantic Margin. With drilling set to commence in the region this summer, we are well placed to benefit from any positive results due to a potential de-risking of 4 billon boe of prospective resources in Europa’s licences in the Porcupine. We have landed one farm-out in Ireland and I am confident we will close out more in our other six licences offshore Ireland, as we look to maintain the momentum behind our strategy to monetise our asset base, manage risk and generate value for our shareholders.

“In the UK, we are carried on a potentially transformational well targeting the conventional Holmwood prospect, which neighbours the Horse Hill discovery and Brockham oil field in the Weald Basin. With a 20% interest, we are materially exposed to considerable upside without having to put any of the Company’s capital at risk drilling the well. Still in the UK and, subject to planning consent being granted, we expect our existing production to almost double to around 220 bopd if the Wressle discovery is brought online following our planning appeal.”

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