Posted: 24/03/17

Parkmead, the UK and Netherlands focused oil and gas group, is pleased to report its interim results for the six-month period ended 31 December 2016. 

 

HIGHLIGHTS 

 

Parkmead moves into gross profit and demonstrates financial strength 

 

• Gross profit for the period of £0.7 million (2015: £4.1 million loss) 
• Strong total asset base of £84.0 million at 31 December 2016 
• Parkmead maintains strict financial discipline
• Well capitalised, with cash balances of US$32.7 million (£26.7 million) as at 31 December 2016
• Parkmead remains debt free
• Low-cost Netherlands gas production provides positive cash flow to Parkmead
• All revenues from Netherlands production received in Euros, mitigating recent currency fluctuations 

 

Major progress on valuable development projects. Additional licence acquisitions

 

• Doubled stakes in the Polecat and Marten oil fields to 100% in the UK Central North Sea in August 2016, which are jointly estimated to hold over 90 million barrels of oil in place
• Increased stakes in the Perth and Dolphin oil fields to 60.05% in September 2016, building Parkmead’s oil reserves
• Perth and Dolphin are at the core of Parkmead’s Greater Perth Area (GPA) oil hub project which has been fully appraised, with a combined total of 17 wells drilled, and has expected recoverable reserves and contingent resources of approximately 104 million barrels of oil
• The Polecat and Marten fields have the potential to be highly valuable to Parkmead as, given their close proximity to Perth, they could be jointly developed as part of the Greater Perth Area project
• New minimal platform concept at the Platypus gas field further increases the value of this development 
• The Platypus joint-venture partnership is currently working towards optimising the export route for Platypus ahead of finalising an offtake agreement, with various export options available given the large availability of infrastructure in the UK Southern Gas Basin

 

Profitable low-cost gas portfolio in the Netherlands. Successful fast-track development

 

• Low-cost onshore gas portfolio in the Netherlands produces from four separate gas fields with an average operating cost of US$14 per barrel of oil equivalent, providing positive cash flows to Parkmead
• Gross production from Parkmead’s Netherlands portfolio averaged approximately 29 million cubic feet per day (approximately 5,000 barrels of oil equivalent per day) during calendar year 2016
• Increased Netherlands gas production more than six fold during the full financial year
• Diever West field brought onstream within just 14 months of discovery
• Further production enhancement work planned on Parkmead’s Netherlands portfolio, including a potential new well at the Geesbrug gas field to maximise production, serving as a natural hedge to the current low oil price environment

 

Increasing oil and gas reserves and resources

 

• Considerable 2P reserves of 27.9 million barrels of oil equivalent as at 31 December 2016, a 19% increase from Parkmead’s 31 December 2015 reserves position of 23.5 million barrels of oil equivalent 
• 2C resources increased by 41% to 59.1 million barrels of oil equivalent as at 31 December 2016 (41.9  million barrels of oil equivalent at 31 December 2015)

 

Well positioned for further acquisitions 

 

• Six acquisitions, at both asset and corporate level, have been completed to date
• The Parkmead team is evaluating further acquisition opportunities to take advantage of the current low oil price environment 

 

Parkmead’s Executive Chairman, Tom Cross, commented:

 

“I am pleased to report significant progress in the period to 31 December 2016. We have increased gas production from Parkmead’s low-cost Netherlands portfolio through an onshore work programme, which has resulted in Parkmead moving into gross profit. This is an outstanding achievement for Parkmead at a time when global oil prices have remained low. 

 

Parkmead’s gas production acts as a natural hedge in this low oil price environment.

 

We are delighted to have been able to increase our stakes in core areas of the Group’s portfolio during the period, particularly around the important Greater Perth Area oil hub in the UK North Sea, where Parkmead has strengthened its position. The Group’s reserves and resources also increased significantly in 2016 through two licence acquisitions.

 

Parkmead is well positioned to take advantage of the ongoing lower oil price and the opportunities that are arising from this. We have excellent regional expertise, significant cash resources, and a growing, low-cost gas portfolio. The Group will continue to build upon the inherent value in its existing interests with a licensing and acquisition-led growth strategy, securing opportunities that maximise long-term value for our shareholders.”

 

 

For enquiries please contact: 

 

The Parkmead Group plc+44 (0) 1224 622200

Tom Cross (Executive Chairman)

Ryan Stroulger (Chief Financial Officer)

 

Panmure Gordon (UK) Limited 

(Financial Adviser, NOMAD and Corporate Broker to Parkmead)+44 (0) 20 7886 2500

Adam James

James Greenwood

 

Instinctif Partners Limited (PR Adviser to Parkmead)+44 (0) 20 7457 2020

David Simonson

George Yeomans

 

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