(Alliance News) - Oil and gas producer Angus Energy PLC on Thursday posted a widened loss, on increased administrative costs and an impairment charge, but reported a promising competent persons report from a Lincolnshire gas field.
Angus Energy shares were 17% higher at 0.99 pence each in London on Thursday afternoon.
In the year ended September 30, its pretax loss widened to GBP5.0 million from GBP2.8 million.
Administrative expenses rose 7.8% to GBP4.0 million from GBP2.4 million. It also booked GBP900,000 in impairment costs, against none in the previous financial year.
Angus Energy said: "The year to September 2019 was unquestionably a difficult year for the Angus Energy Group, which saw first boardroom upheaval, a one year delay to confirmatory works at Balcombe, followed by the discovery that the Kimmeridge well at Brockham would not commercially flow oil as part of conventional operations.
"As a consequence, in part of this poor operating result, the group's financial resources were strained resulting in a succession of equity placings. Finally, as a backdrop to this, the regulatory environment has become steadily more challenging and all the while the question of sustainability bedevils the UK's onshore oil and gas industry."
Angus also on added on Thursday that a competent person report has been completed at Saltfleetby, Lincolnshire. Angus has a 51% stake in the gas field.
According to the report, the company's share of capital expenditure at the asset will be GBP1.5 million. The company's share of the proved and probable reserves stands at 16 billion cubic feet.
Angus added: "The resulting mean value of the reserves to Angus shareholders, which is also the central case, is just over GBP25 million, with a high case of GBP35 million and a low case of GBP16.7 million."
Managing Director George Lucan said: "This is clearly a gem of an asset and a just reward to loyal shareholders. We look forward to converting these reserves into clear cash and positive cashflows whilst keeping open the possibility of further substantial upside from the contingent resources. The exercise has been immensely useful for Angus management in identifying opportunities within the field as well as planning for connection and long-term operation."
Also on Thursday, Angus said it received a notice from lenders Riverfort Global Opportunities PCC Ltd and YA II PN Ltd to convert GBP200,000 of a loan into shares.
Angus said it has allotted 32.1 million shares to the lenders, reducing the loan balance to GBP600,000. Angus now has 604.0 million shares in issue.
By Eric Cunha; ericcunha@alliancenews.com
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Angus Energy (ANGS)