Ascent Resources plc (LON:AST), the AIM quoted European oil and gas exploration and production company has today reported its audited full year results for the year ended 31 December 2016.
· Gas sales agreement signed with INA giving the joint venture a route to market for gas via the export production pipeline.
· Acquisition of Trameta, providing the Company with access to the export production pipeline to Croatia.
· Raised £6.0 million via equity and convertible loan placings.
· Reduction in debt of £5.0 million though loan note conversions and repayment of short-term facility.
· Reduced loss for the year by £1.0 million through reduced administrative expenses (£0.5 million) and lower finance costs (£0.5 million).
Post Period Highlights:
· First commercial sale of gas delivered from Pg-10 in April 2017.
· £3.0m raised via equity placing through PrimaryBid.com in February 2017.
· Further £4.0 million of loan note conversions significantly reducing debt.
Colin Hutchinson, CEO of Ascent Resources plc, commented: “In the period under review and subsequently the Company has transformed itself from an explorer into a properly funded producer.
We look forward to continued success in the future.”
Progress in the period under review and the first few months of 2017 is probably the greatest in the Company’s history.
At the date of the last annual review we were heavily occupied by Slovenia’s interpretation of EU environmental regulations; without a market for our gas; and unsure of the productive qualities of our two drilled wells Pg-10 & Pg-11A. However, thanks to surviving on successive equity placements and the support of our principal partners and financial backers, we ended the year on a sound financial footing.
Now, we have demonstrated the productive capabilities of our main well, Pg-10; re-commissioned and constructed connecting pipelines; and signed a contract with INA to sell our gas across the Slovenian border for treatment in Croatia. We are better funded to maximise the opportunities ahead and the ultimate progress is that we are now selling gas, with production and gas sales having started in 2017.
Under the terms of the Petišovci Joint Venture Agreement, we are entitled to retain up to 90% of the income received against historic costs, which to date are €43 million. We therefore anticipate a build-up in the Company’s cash reserves over the coming months.
This has all been achieved whilst reducing our general and administrative expenditure from £1.9 million to £1.4 million.
However, much remains to be done.
We remain hopeful of an early decision by the Slovenian authorities to allow the much-delayed environmental permit to be issued. This will enable the construction of a larger gas treatment facility, which will be required to develop the Petišovci project to its fullest potential.
We are indebted to our workforce, led by Chief Executive Colin Hutchinson, all of whom deserve praise for their commitment to the Company. We are also grateful for the continued support and strong working relations with our Slovenian partners Petrol and Nafta Lendava.
I look forward to reporting further progress in the coming months and thank shareholders for their continued support.