LONDON (Alliance News) - IGas Energy PLC on Thursday reported a widened annual loss on exploration write-offs but also saw its average production fall.
In 2018, the oil and gas explorer's pretax loss widened to GBP25.1 million from GBP3.2 million in 2017. The company's revenue increased 20% to GBP42.9 million from GBP35.8 million the year before.
The widened loss was attributed to a GBP29.1 million non-cash exploration write-off at Doe Green.
IGas' net production averaged 2,258 barrels of oil equivalent per day in 2018, 3.3% behind the 2,335 averaged the year before.
The company's operating costs increased 13% to USD31.9 per barrel of oil from USD28.2 in 2017.
For 2019, IGas is guiding for net production of between 2,200 barrels of oil equivalent per day to 2,403 with operating expenditure of USD32.5 per barrel of oil.
The company has hedged 525,000 barrels in 2019 at an average put price of USD58.5 per barrel.
"As shown by the 200% reserves replacement in 2018 there is still significant upside in our conventional portfolio and we look forward to bringing projects to final investment decision over the coming months," said Chief Executive Stephen Bowler.
Bowler added: "We believe gas will be the transition fuel in Britain as we move to a cleaner energy future. As an industry we now have data that supports the potential of the rocks under our feet. We urgently need to ensure this abundant resource is brought out of the ground to deliver the significant benefits it offers to the country."
Shares in IGas Energy were up 3.4% Thursday at 76.50 pence each.
At the Springs Road project in Nottinghamshire, IGas has previously reported further hydrocarbon discoveries. Following work at the SR-01 well, IGas found a hydrocarbon-bearing shale of over 250 metres, including both the upper and lower Bowland Shale.
On Thursday, IGas said the shale appraisal campaign yielded "highly encouraging" initial results.
Egdon Resources PLC, which holds a 15% interest in the PEDL140 licence, said Thursday: "These results from the Springs Road-1 well are highly encouraging, having encountered all three pre-drill objectives and demonstrating the presence of a significant sequence of hydrocarbon bearing shales.
"We await with anticipation the results of the detailed core and wireline log analysis which will provide additional insight into the resource potential of the Gainsborough Trough where Egdon holds interests in 82,000 net acres. We look forward to updating shareholders in due course."
Egdon Resources was trading 4.0% higher at 6.50 pence each.