(Sharecast News) - Touchstone Exploration reported second-quarter crude oil sales of 1,402 barrels per day in an update on Friday, making for an 8% increase relative to the prior quarter, and consistent with the 1,396 barrels produced per day in the same period of 2020.
The AIM-traded firm said despite Covid-19 challenges in Trinidad in the three months ended 30 June, it executed an "incident-free" $6.66m exploration programme focussed on Cascadura Deep-1 and Chinook-1 well production testing, Royston-1 lease and drilling expenditures, and the Royston area seismic programme.
Realised crude oil prices averaged $59.06 per barrel, representing a 13% increase from the first quarter of 2021, and a 101% increase from the second quarter of 2020.
The company generated an operating netback of $26.30 per barrel from an average Brent price of $68.98 per barrel.
Despite limited petroleum asset capital investment of $0.13m, generated funds flowed from operations of $1.21m, compared to a $0.45m use of funds flow in the second quarter of last year.
Touchstone recognised a reduced net loss of $0.28m, compared to a net loss of $2.74m a year earlier.
The board said liquidity remained "strong", as it ended the second quarter with cash of $11.21m, a working capital balance of $4.67m, and $7.5m drawn on its term credit facility, resulting in a net debt position of $2.83m.
It entered into revised 10-year lease operating agreements for its Coora-1, Coora-2, WD-4 and WD-8 blocks through to 31 December 2030.
The firm also executed an amendment to its $20m term loan facility agreement, extending the principal availability period to 31 December 2021 from 15 June 2021, thus allowing it to access the outstanding $12.5m available balance before the end of the year.
Finally, Touchstone confirmed that it spudded its final Ortoire minimum exploration commitment well, Royston-1, on 12 August.
"Our second quarter results continue to demonstrate the progress we are making in all areas of our operations in Trinidad and are a testament to the great work done by our dedicated staff amidst a challenging Covid-19 environment," said president and chief executive officer Paul Baay.
"The positive cash flow derived from our base assets and our strong liquidity position have allowed us to advance our exploration operations while we work towards initial natural gas production at our Coho and Cascadura discoveries.
"The team has been active in increasing our base oil production through a series of low-cost workovers and well optimization while preparing for the four development well drilling programmes planned for the fourth quarter of 2021."
On the Ortoire block, Baay said the company was progressing "on all fronts", including road construction, bridge repairs, well testing, seismic shooting, facilities design, pipeline installation, and drilling at its "highly-anticipated" Royston prospect.
"We remain confident that our available credit facility capacity combined with anticipated funds flow from operations will be sufficient to complete our budgeted four well development programme as well as drilling Royston-1, one of a number of milestones that we forecast to achieve in the second half of 2021 as we conclude the first phase of our Ortoire exploration programme."
At 1030 BST, shares in Touchstone Exploration were down 3.4% at 85.01p.
Touchstone Exploration (TXP)1 Jun 2024 13:58
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