(Alliance News) - Argos Resources Ltd said Friday it swung to an annual loss after Noble Energy Falklands Ltd and Edison International SPA withdrew from a licence.
Shares in Argos Resources were down 5.3% at 3.60 pence in midday trading in London.
Exploration company Argos Resources posted a USD401,000 total loss for 2019, swinging from a USD406,000 profit the year before, after Noble and Edison informed Argo they would be withdrawing from production licence PL001 in the North Falkland Basin.
"The loss in 2019 reflects the administration cost of operating the group following the withdrawal of Noble and Edison. The profit in 2018 was due to the recognition of the full amount of the income due under the termination terms of the participation agreement," Argos Resources explained.
The company's administrative expenses rose to USD433,000 from USD334,000 and the company recorded no other income in 2019 versus other income of USD784,000 in 2018.
Chair Ian Thomson and Managing Director John Hogan said: "Under the terms of a participation agreement between the company, Noble and Edison, the company continued to receive quarterly cash payments from Noble and Edison of GBP75,000 per quarter during 2019, up until 27 December 2019. These payments contributed to a cash balance of USD768,000 at year end 2019, leaving the group adequately financed for at least twelve months beyond sign-off.
"In order to continue as a going concern beyond that point the company will need to raise further finance, either through a new partner or by raising funds in an equity issue."
They added that: "The cash available will fund the group in its search for a farmout partner."
By Anna Farley; annafarley@alliancenews.com
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