LONDON (Alliance News) - Argos Resources Ltd Tuesday said it widened its losses in 2013, largely due to a foreign exchange loss compared with a gain the prior year, and as it continued to invest in its exploration and evaluation activities, having identified a large inventory of prospects.
Argos, an oil and gas exploration company listed on AIM and based in the Falkland Islands, said that technical work on production licence PL001 has progressed well, and it has identified a large inventory of prospects, many of which are similar to the adjacent Sea Lion oil discovery. It said that independent studies indicate the presence of mature oil source rocks across the licence area capable of generating significant volumes of oil.
As a result, the group said it is now focused on securing financing for exploration drilling to test the prospect inventory.
"We are focussed on finding an industry partner to finance drilling operations with the capability and track record of progressing discoveries through to development. We now have a number of companies who have been through the farmout data room and are expressing interest. Negotiations are under way," said Chairman Ian Thomson in a statement, referring to potential investors in its project being given access to company information.
Argos said it is making progress in arranging a shared drilling programme with a rig identified and under negotiation for a drilling programme commencing in early 2015.
"While Argos Resources cannot make a commitment to this rig contract until we have completed a farmout, we have remained in close contact with the other operators to ensure there is an option to join this drilling programme once financing is secured," Thomson added.
Argos said that while administrative expenditure continues to be fully funded for the foreseeable future, further fundraising will be required before the group can embark upon a drilling programme.
In 2013, the group reported a loss of USD1.8 million, up from USD1.6 million in 2012, which it said was largely due to a foreign exchange loss of USD15,000 in the year, compared with the a gain of USD130,000 the prior year.
The group said it invested USD0.7 million during the year in further exploration and evaluation activities, while cash in the year reduced to USD2.9 million, from USD5.7 million in 2012, due to the overhead spend.
Argos shares were down 0.5% at 14.43 pence Tuesday morning.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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