President Energy (LSE:PPC) confirmed details of its work programme for 2019/2020 in an announcement on Monday. The firm plans to spend around $50m on the programme which it says it believes it can fund from existing cashflow. The programme includes plans to drill 15 new wells and to perform around 20 workovers
President’s operations are largely focussed on assets in Argentina with it exiting 2018 with production of around 3300 barrels of oil equivalent per day (boepd). That figure represented year-on-year growth of more than 50pc and exceeded the company’s original target of 3000 boepd. President’s aim is to deliver a further 50pc increase in year-on-year production by the end of the 2019/2020 programme.
Over the next few months, the firm plans to complete at least ten workovers in Puesto Flores Estancia Vieja, Puesto Prado, and Las Bases. A rig has been mobilized to the first well location.
Renovation and commissioning of the oil treatment plant in Puesto Prado by the end of May will allow deliveries of oil from the field directly to local refineries increasing margins. The company will then focus on upgrading the gas plant in Las Bases to increase its capacity more than ten-fold to 250k cubic metres of gas. President plans to drill around seven new production and appraisal wells in the second half of the year. The company will also commission an electricity generation plant to power Puesto Flores from gas at Estancia Vieja, selling surplus electricity to the grid.
Next year, President will drill eight further wells across Las Bases, Puesto Prado, Estancia Vieja, and Puesto Flores and around eight workovers. A second phase of upgrading Las Bases is also planned in 2020, increasing its capacity to one million cubic metres of gas.
President’s share price has been in decline since the beginning of 2018 when it was around 12.5p. Today, the share price is 7.25p equating to a Market Cap of around £80.5m.