www.xcite-energy.com
Xcite Energy Limited is a heavy oil appraisal and development company, with current interests in three licence blocks in the UK North Sea, all of which are held with 100% working interests through its wholly-owned UK subsidiary, Xcite Energy Resources Limited.
Its primary focus is in bringing the Bentley oil field on Block 9/3b into production and in doing so becoming a significant independent oil producer in the North Sea by 2014.
Watch Xcite Energy's May 2012 Corporate Video here.
Xcite says development plan changes a more "financially efficient" way of unlocking Bentley's value - UPDATE
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Xcite Energy (LON:XEL, CVE:XEL) said the changes to its field development plan provide a “viable and more financially efficient” means of commercialising the Bentley North Sea oil field.
The comments were made in a shareholder update in which the group also said it is optimistic it will be able to convert 87 million barrels of contingent resources to the higher confidence proved and probable (2P) category.
This will occur once the Department of Energy and Climate Change has given the sign-off for the Bentley field development plan.
The upgrade would give Xcite 115 million barrels of 2P reserves.
“We had hoped, and remain optimistic, that this response will be received shortly and that the field development update could have been made in conjunction with the announcement of a number of other important events for the company in the coming weeks,” Xcite said.
Today’s statement followed an announcement on December 1 that revealed the company had “reconfigured its approach” to the development of the heavy oil discovery.
The planned first stage production programme for Bentley will be split into two parts - phases 1A and 1B.
As a result, the overall oil field development project will take marginally longer than previously thought to bring on stream.
The revised plan means that Xcite can still achieve first oil next year, as it originally planned, but phase 1B is set for 2013 and phase 2 is penciled in to start in 2016.
It added: “We have a highly valuable asset being managed by an experienced and knowledgeable team, supported by, in our view, excellent technical and financial advisers.
"Bentley remains a complex project, which we are striving to bring to fruition as efficiently as possible in challenging economic circumstances.
"We have confidence in the outcome and ask for the patience and support of shareholders while we progress the various initiatives.
“We reiterate the commitment of the board of directors and management team to its shareholders.
“For over eight years, the Xcite Energy team has been and continues to work hard on the Bentley project and we are now at a decisive stage for the company, with drilling planning for phase 1A proceeding on schedule.
Separately, the company also said this morning work has started on the enhanced oil recovery programme.
It said it is identifying the “technologies and business methods that can deliver significant additional barrels from Bentley through tertiary production techniques”.
“Our early work is encouraging,” Xcite added.
In a note today, broker Oriel Securities, which retains its 'buy' recommendation on the stock, said it was making no changes to its risked net asset value (NAV) for the firm, which stands at 216 pence per share.
