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LONDON (Alliance News) - Clontarf Energy PLC on Thursday said its loss doubled in the first half of 2018 due to an impairment of its exploration & evaluation assets.
Shares in the oil producer & explorer were down 7.2% at 0.38 pence on Thursday.
Contarf recorded a GBP237,000 loss in the six months to June 30, widening from GBP115,000 the year before. In large part, this was because it incurred a GBP115,000 impairment, where no such impairment was reported the previous year.
The company's administrative expenses also widened, although less significantly, to GBP122,000 from GBP115,000.
A petroleum agreement for Clontarf's Tano 2A Block in Ghana has been submitted while the company has also re-established its interest in a lithium joint venture in Bolivia. The company previously operated a joint venture in Bolivia but said it was "frustrated by political developments".
In 2017, Clontarf was awarded Block 18 in Equatorial Guinea, and began discussions to finalise a work programme but has faced challenges.
"During negotiations, the authorities pressed us to enter into a binding contract to buy historic 3D seismic, at higher than current acquisition costs, including a substantial up-front payment," the company said.
"While Block-18 remains potentially prospective, we could not justify this substantial up-front expenditure," it continued.
Clontarf made a counter-proposal but the New Guinea authorities did not accept it. In his conclusion, company Chairman John Teeling said that he anticipated a "re-rating of oil stocks".
"World oil shares are still being valued on an implicit oil price of USD27. The farm-out market is subdued and exploration shares depressed. A trillion dollars has been cut from necessary investment plans. This is not sustainable," said Teeling.
"Clontarf plans to ride this wave," he added.
Brent was quoted at USD81.70 a barrel in midday trade against USD81.52 at the London equities close on Wednesday. Notably, the North Sea benchmark touched a four-year high of USD82.52 earlier this week.
The company raised GBP500,000 through placing in September, and plans to use this to fund its ongoing negotiations in Ghana as well as for working capital.