Serinus Energy plc (LON:SENX, WSE:SEN) has announced the release of its interim results for the three months ended 31 March 2021.
HIGHLIGHTS
Operational
· Serinus Energy plc and its subsidiaries have continued to operate safely and effectively through the COVID-19 pandemic, with the successful implementation of operational and monitoring protocols to ensure the health and safety of our employees.
· As announced on 23 February 2021, the Company drilled and completed the M-1008 well. The well was subsequently brought on production on 28 February 2021. The well flowed on test at 4.0 MMscf/d (approximately 667 boe/d) from two perforated zones and has been tied into the Moftinu Gas Plant.
· Serinus is well advanced with construction of the access road and the wellhead and tubulars have been ordered for the Sancrai-1 well. The rig tendering process is underway and the Sancrai-1 well is expected to spud by the end of June.
· The Group has received approval from the working interest partner in the Sabria field in Tunisia to implement the first artificial lift program which is expected to be initiated later in the year.
· The Company has contracted with suppliers to undertake the compression project on the Moftinu field, which is intended to stabilize and extend existing production. Compression on the first well is targeted in the coming months in conjunction with a planned gas plant maintenance shut down.
· Production for the period averaged 2,097 boe/d, comprising:
o Romania – 1,495 boe/d.
o Tunisia – 602 boe/d.
o Production has increased in Tunisia, showing the positive effects of the workover program.
· The Group exited 31 March 2021 with a production rate of 2,178 boe/d, with a March 2021 average of 2,240 boe/d.
Financial
· The Group continued to see a strong recovery in prices, with net realised price of $40.16/boe, comprising:
o Realised oil price – $54.03/bbl.
o Realised natural gas price – $5.98/Mcf.
· The Group’s operating netback for the three months ended 31 March 2021 was $23.90/boe, comprising:
o Romania operating netback – $26.23/boe.
o Tunisia operating netback – $18.33/boe.
· Funds from operations for the three months ended 31 March 2021 were $2.4 million.
· Capital expenditures of $3.5 million, comprising:
o Romania – $3.0 million, related to the drilling, completion and tie- in of the M-1008 well and preparation for Sancrai-1.
o Tunisia – $0.5 million, related to workovers in Sabria and Chouech.
· EBITDA for the three months ended 31 March 2021 was $2.6 million.
· Cash balance as at 31 March 2021 was $5.3 million.
OPERATIONAL UPDATE AND OUTLOOK
Serinus is an oil and gas exploration, appraisal and development company. The Group is the operator for all its assets and has operations in two business units: Romania and Tunisia.
ROMANIA
The Company currently holds one large concession area (approximately 3,000km2), Satu Mare, located in a highly sought-after hydrocarbon province. The Moftinu Gas Project is what the Group hopes to be the first of many shallow gas developments. The concession is extensively covered by legacy 2D seismic and the Group considers the concession to have multiple sizable prospects available for further exploration.
During the three months ended 31 March 2021, the Company successfully drilled, completed and initiated production from the M-1008 well. This well was drilled to a total depth of 1,000 metres and flowed at 4.0 MMscf/d (approximately 667 boe/d).
The Company has contracted with suppliers to undertake the compression project on the Moftinu field. The project is intended to stabilize and extend existing production. Compression on the first well is targeted in the coming months in conjunction with a planned gas plant maintenance shutdown. The project to drill the first exploration well, the Sancrai-1 well, is underway with work on the access road having begun during the first quarter. Long-lead items have been ordered with an expected spud date by the end of June. The Sancrai-1 well will satisfy the last remaining commitment of the third exploration phase.
TUNISIA
The Company currently holds five concession areas within Tunisia. Of the five concession areas the Company is currently focused on, three of those areas have discovered oil and gas reserves and are currently producing; Sabria, Chouech Es Saida, and Ech Chouech. The largest asset is the Sabria field, which is a large oilfield play that has been historically under-developed. Serinus considers this to be an excellent asset for remedial work to increase production and, in time with proper reservoir studies, to conduct further development operations.
During the three months ended 31 March 2021, the Company continued to complete various workover projects to increase existing production. The Company has received official approval from the working interest partner in Sabria to install the first artificial lift into the field which is expected later during the year.
COVID-19
The health, safety, and wellbeing of all staff continues to be the Company’s top priority throughout this difficult time. All Group offices remain closed, as such the Company continues to ensure all employees are able to successfully work from home.
