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(Alliance News) - Nostrum Oil & Gas PLC on Tuesday reported a decrease in its 2020 revenue and average daily production despite beating its expectations for both.
The exploration and production company operating in the Caspian Basin area in eastern Europe's 2020 revenue fell substantially to USD175.9 million from USD322.1 million in 2019, just over its expectations of more than USD175 million.
Nostrum said 2020 earnings before interest, tax, depreciation and amortisation fell sharply to USD80.4 million from USD199.6 million in 2019, partially impacted by the drilling halt throughout 2020.
The company's 2020 average daily production after treatment totalled 22,337 barrels of oil equivalent per day, down from 28,540 barrels in 2019 but ahead of guidance for 21,000 barrels. Annual average daily sales volumes stood at 21,514 barrels of oil equivalent per day, a decrease from 26,626 barrels in 2019 but ahead of 20,000 barrels guidance.
"The group has faced a number of challenges in 2020, but with prompt and decisive action we have been able to manage our liquidity and reduce reservoir decline. Signing the forbearance agreement has provided the time to engage with our bondholders and shareholders to restructure the debt and we are very hopeful of a successful conclusion to this process in the coming months. A robust bond restructuring will give the company a solid foundation to build from. We will continue discussions with third parties to secure additional volumes to commercialise our world-class infrastructure whilst proactively managing our cost base and liquidity," said Chief Executive Arfan Khan.
Looking ahead, Nostrum said it is now "pivoting towards growth and transitioning into a multi-asset energy company."
"Our success in the near-term will depend upon safeguarding the base business and liquidity, sweating the producing asset and adding to proved developed producing by exploiting low cost per barrel, high-confidence infill opportunities with best-in-class well & reservoir management, continuing to deliver on our health & safety performance and delivering on our promises and restoring investor confidence," said
Shares in Nostrum Oil & Gas were up 4.3% at 8.68 pence in London on Tuesday.
By Zoe Wickens; zoewickens@alliancenews.com
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