Predator Oil Regulatory News (PRD)

Predator Oil & Gas Holdings PLC 

31 March 2020 

Predator Oil & Gas Holdings Plc / Index: LSE / Epic: PRD / Sector: Oil & Gas 

Predator Oil & Gas Holdings Plc

("Predator" or the "Company" and together with its subsidiaries "the Group")

 Company Update  

Predator Oil & Gas Holdings Plc (PRD), the Jersey-based Oil and Gas Company, provides the following company update to the market in light of the ongoing worldwide situation with regard to the Coronavirus.

The fundamentals of the Company are unchanged - well-capitalised, low overheads, revenues anticipated from Trinidad in due course, Trinidad operations forecast to be profitable even at lower oil price; drilling opportunity in Morocco which still aims to exploit a very attractive gas pricing scenario which remains robust when selling to an industrial domestic market in competition against more expensive imported fuels.

Trinidad

The Company's Enhanced Oil Recovery ("EOR") project in Trinidad remains on track for revenues and encouragingly for Predator the project economics are still attractive even at WTI 20 $/brl. Trinidad like most countries has implemented restrictions on movement of people for non- essential work and these policies will remain in place for at least the next few weeks. The Inniss-Trinity Field does remain operational and oil field personnel have been issued with passes to travel to and from the field.

The Company has injected more CO2 into AT-5X as part of initiating Phase 2 of the CO2 EOR pilot project and has observed encouraging downhole pressure build-up. The remote access data gathering system that was put in place before Coronavirus struck allows the Company to monitor real-time pressure data and to adjust injection pressures and CO2 injected volumes remotely through the Company's CO2 EOR operating personnel in the field. The next step is to inject CO2 at even higher pressures and on a continuous basis and Predator's CO2 provider is currently working to achieve this objective as quickly and safely as possible working under the current revised HSE protocols.

Predator are progressing with desktop work and approvals processes to further develop its ability to increase the volume of CO2 supply to the CO2 EOR operations using only our existing in-country equipment and field site for CO2 equipment layout. The Company is also importing spare components to ensure there is some ability to continue operations without being delayed waiting on replacement components should the need arise during the early period of the Coronavirus emergency. The Directors of the Company are encouraged by progress to date, despite a very challenging global environment and see that this is an opportune time to gather more technical and reservoir engineering data and to prepare for an expansion of CO2 EOR operations both within the Inniss-Trinity field and to other fields in Trinidad, which have been identified as being potentially attractive for pilot CO2 EOR operations. The Company has developed a viable template for CO2 EOR projects and has achieved some recognition of its Intellectual Property rights in respect of this template. It makes commercial sense for the Company to focus on developing these new opportunities to a stage whereby they can be implemented to increase potential cash flow from CO2 EOR by gradually upscaling, with very low capital commitments as the market begins to strengthen as Coronavirus is addressed and ultimately defeated. Positive cash flow at low oil prices will be critical during this transition period and the Company now has additional time to potentially expand CO2 EOR operations in Trinidad for very low capital investment and therefore potential for additional revenues whilst Morocco remains in the drill planning stage, allowing the Company to accumulate additional cash prior to drilling.

Morocco

The rig earmarked for drilling the Company's Guercif prospect is stacked in a secure yard at SDX Energy, de-manned but ready to be reactivated for use by Predator with very basic routine maintenance when restrictions on travel for essential rig crew and service personnel are eased or lifted. Desktop planning for the well continues at minimal cost and inventory for the well is still available within Morocco. No commercial contracts have been or will be entered into by the Company in respect of drilling until the Coronavirus restrictions permit normal business operations to be resumed. Morocco is impacted by Coronavirus and like Trinidad is not yet at the peak. The Company's target is to be "drill-ready" to move to execute the drilling programme at the appropriate time following lifting of Coronavirus restrictions.

Corporate

The Company is still planning to issue its 2019 Annual Accounts by 30 April 2020 and is working with our auditors to meet this schedule. These will contain a summary of operations and developments for the year under review together with a review of business strategy going forward to mitigate against the impact of Coronavirus.

Paul Griffiths, CEO of Predator Oil & Gas Holdings Plc said:

"Following our recent equity fundraise of £3.56m before expenses and given that our fixed corporate overheads are very low, the Company is very well-placed to ride out the current worldwide issues which will gradually subside. Our projects are in good order and we are fortunate that with a strong net cash position we are in an excellent position to take advantage of any acquisition opportunities that may arise as a result of the present situation to enhance our portfolio and create additional value for shareholders. Whilst we are opportunistic we remain conservative and focused on our existing projects." 

This announcement contains inside information for the purposes of Article 7 of the Regulation (EU) No 596/2014 on market abuse

For more information please visit the Company's website at www.predatoroilandgas.com:

Enquiries:

Qualified Person's statement:

The information contained in this document has been reviewed and approved by Mr. Paul Griffiths, Chief Executive Officer. Mr Griffiths has a BSc in Geology from Imperial College London and is an Associate of the Royal School of Mines. Mr. Griffiths has over 43 years of relevant experience in the upstream oil industry.

Background to Guercif Drilling Plans

The initial drilling programme will comprise the drilling of the Moulouya-1 Prospect, subject to all regulatory consents and approvals, to a depth of 2,000 metres. The drilling rig mobilisation and drilling operations are expected to take up to 30 days.

Completion of the first well will release US$ 1 million of PGVL's US$ 1.5 million bank guarantee with ONHYM, subject to final delivery of all the data from the well to ONHYM.

At PGVL's sole option, and subject to ONHYM approval and all regulatory consents being received, PGVL shall have the option to extend the drilling programme by the drilling of either an appraisal well, if required, or a follow-up exploration well to capitalise on significantly reduced mobilisation and well services costs attributable to having an active rig available for immediate use.

Notes to Editors: 

Predator is operator of the Guercif Petroleum Agreement onshore Morocco which is prospective for Tertiary gas in a prospect 4 kilometres from the Maghreb gas pipeline, and deeper Triassic gas. A well location has been selected for drilling in Q2 2020 and a rig option agreement has been exercised. 

Predator is an oil and gas exploration company with the objective of participating with FRAM Exploration Trinidad Ltd. in further developing the remaining oil reserves in the producing Inniss Trinity oil field onshore Trinidad, primarily through the application of C02 EOR technology. Potential for cash flow exists by executing the Pilot Enhanced Oil Recovery project using locally sourced carbon dioxide for injection into the oil reservoirs ("C02 EOR"). Near-term expansion and growth potential is focussed on upscaling the C02 EOR operations in the Inniss-Trinity oil field.

In addition, Predator also operates exploration and appraisal assets in licensing options offshore Ireland, for which Successor Authorisations have been applied for, adjoining Shell's Corrib gas field in the Slyne Basin on the Atlantic Margin and east of the Kinsale gas field and Barryroe oil field in the Celtic Sea. Ireland however remains a very challenging regulatory environment for business investment in the oil and gas sector and is not the immediate focus of the Company's near-term operations. 

The Company has a highly experienced management team with a proven track record in the oil and gas industry.