LONDON (Alliance News) - JKX Oil & Gas PLC on Monday said its production levels for the five months to the end of May were higher than the same period a year earlier, but revenue dipped due to the weakening of local currencies, particularly the Russian rouble.
The oil and gas operator, focused on Ukraine and Russia, said it produced 10,322 barrels of oil equivalent per day between the start of January and the end of May, up 21% from the same period a year earlier. Gas production in Russia was 41% higher, JKX Oil said, due to its Well 27 coming on line in late 2015 and undergoing several successful acid tests in the first five months of this year.
Despite the cancellation of any development expenditure since early 2015, JKX Oil said gas production levels in Ukraine were stable year-on-year, whilst oil production increased by 12%. Both results, it said, were due to the implementation of an "enhancement program targeting the technical potential of existing well stock".
However, for the five months, revenue came in 19% lower than the same period a year earlier, due to the weakening of local currencies, in Ukraine and Russia, as well as the decline in oil and gas prices.
Elsewhere in the business, JKX Oil said it was in the process of repatriation of dividends for 2014 and 2015, after the National Bank of Ukraine eased the restrictions on payments of dividend to overseas shareholders.
JKX Oil said it also continues to identify cost-reduction possibilities and, since January, said it has reduced head office headcount in London by 45%.
"The field development plan for our Ukrainian assets is nearing completion, and will provide a framework for future business and capital planning, as well as a baseline for investment decisions. The process of monetisation of our Russian and Hungarian assets is underway. We also look forward to completing our inherited legal battles as early as this summer, and getting back to work by resuming investment in oil and gas production through drilling and/or acquisition," JKX Oil said in a statement.
Shares in JKX Oil were down 0.5% on Monday at 18.40 pence.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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