(Alliance News) - Volga Gas PLC on Tuesday said it swung to a loss for 2019 on higher costs and impairment charges, despite a marginal rise in revenue.
Also on Tuesday, Russia-focused oil & gas firm said it has started a formal review into various options available to it.
These options include a potential sale of the company, of the farm-out or sale of one or more of the company's assets.
Volga has appointed Renaissance Capital as its financial adviser for the strategic review and formal sale process and Auctus Advisors LLP as an independent financial adviser.
For the year, the company reported a pretax loss of USD10.5 million compared to a profit of USD10.6 million the year before, as revenue edged up to USD46.0 million from USD45.9 million.
In the year, Volga said the average production in 2019 declined by 4.0% to 4,927 barrels of oil equivalent per day from 5,144 boepd the prior year, while sales volumes dropped by 2% to 4,871 boepd from 4,956 boepd.
Volga said it will not declare a final dividend for 2019 and does not expect to declare a dividend of 2020.
"The financial results we are reporting today are satisfactory, in spite of the adverse operating results and the downgrade to the reserves in the Vostochny Makarovskoye field, and we are pleased that Volga Gas has the financial strength to withstand the additional challenges posed by the Covid-19 pandemic," said Chief Executive Andrey Zozulya.
"The group remains cash flow positive at an operational level at current oil prices, assuming no extensive disruptions, and thanks to our strong balance sheet and our ability to delay or cancel capital investment projects as necessary, the board is confident that the group will be able to withstand the current crisis and continue as a viable business for the long term," Zozulya added.
Shares in Volga Gas were up 0.9% at 21.70 pence on Tuesday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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