LONDON (Alliance News) - Shares in Amerisur Resources PLC dropped early Monday after the company slashed its spending guidance for 2015 and said it will focus on production from low-cost platforms.
The company said it has cut its capital expenditure guidance for 2015 to USD45 million, from USD95 million previously. The company said it will aim to minimise the use of high cost transportation in 2015 until its pipeline to Ecuador becomes operational.
It said it will suspend production from more expensive pads temporarily and said transportation to the Rio Loro oil export facility in Colombia will be cut to a nominal daily volume.
Amerisur expects 2015 production to increase to 8,200 barrels of oil per day after its pipeline to Ecuador becomes operational and is delivering transportation costs at USD5 per barrel. It expects this to happen in the second half of the year. It then expects production to rise in 2016.
For 2014, the group average production hit 6,242 barrels per day, up 32% year-on-year against 4,730 barrels produced last year.
"We have changed the 2015 plan in a responsible way ensuring a high probability of delivery and securing a platform with good upside potential. Importantly the main actions and savings can be implemented immediately," said Amerisur Chief Executive Officer John Wardle.
Shares in Amerisur were down around 15% in opening trade, before paring back to be down 6.9% to 31.675 pence.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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