14 Jun 2017 07:00
14 June 2017
IGas Energy plc (AIM: IGAS)
("IGas" or "the Company")
Annual General Meeting Trading Update
IGas today provides the following statement in relation to trading for the period 1 January to 13 June 2017. This update is issued in advance of the Company's Annual General Meeting ("AGM") which is being held at 10.30am today.
Highlights
· Successful completion of balance sheet restructuring and fundraising in April 2017
o Experienced industry investor, Kerogen Capital, now a 28% shareholder following its $35 million equity investment
o Further $22 million raised in placing and open offer
· Net debt reduced from $122 million at 31 December 2016 to c.$8 million as at 31 May 2017
· Cash flow generative at current oil prices
· Net production averaged 2,320 boepd for the first five months of the year. Production was marginally below budget for the period due to necessary maintenance on a number of wells for which we are taking remedial action, including engagement of an additional workover rig to accelerate reinstatement of these wells. This will have an associated impact on full year operational expenditure per barrel. Net production for the year is anticipated to be c.2,400 boepd
· Shale appraisal and development plan covered by up to $230 million carried work programme:
o Agreed and signed Section 106 legal agreements for the exploratory well sites at both Springs Road and Tinker Lane. Planning conditions now to be discharged ahead of construction phase and commencement of drilling activity; spudding is currently anticipated to commence in the fourth quarter of 2017
· As previously announced, Chairman and Founder, Francis Gugen and John Bryant are to retire and Mike McTighe to become Chairman following the AGM, subject to shareholder approval. In addition John Blaymires and Julian Tedder have resigned from the PLC board effective following the AGM but will remain directors of the operating companies and continue to hold their executive roles
Stephen Bowler, Chief Executive commented:
"We are delighted to have completed the fund raising and refinancing in the period whilst also moving forward our operational plans.
There continues to be volatility in the commodity and foreign currency markets and we are keeping our costs under constant review. Importantly, following the refinancing, we are cash generative at current oil prices and have a low level of debt in the business.
We continue to move our shale work programme forward, with three wells having received formal planning approval in North Nottinghamshire. We see further momentum building across the wider UK shale industry as Cuadrilla and Third Energy move closer to drilling their wells and INEOS has begun to submit planning applications and shoot seismic across its licensed acreage. This additional data will help us and the wider industry to further understand the Shale prospectivity in these basins.
We look forward to an exciting second half of the year, with a strong balance sheet enabling us to capitalise on value accretive opportunities and rebuild shareholder value."
For further information please contact:
IGas Energy plc
Tel: +44 (0)20 7993 9899
Stephen Bowler, Chief Executive Officer
Julian Tedder, Chief Financial Officer
Ann-marie Wilkinson, Director of Corporate Affairs
Investec Bank plc (NOMAD and Joint Corporate Broker)
Tel: +44 (0)20 7597 4000
Sara Hale/Jeremy Ellis/George Price
Canaccord Genuity (Joint Corporate Broker)
Tel: +44 (0)20 7523 8000
Henry Fitzgerald-O'Connor
Vigo Communications
Tel: +44 (0)20 7830 9700
Patrick d'Ancona/Chris McMahon