Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Max Petroleum reports rise in annual revenue

Max Petroleum reports rise in annual revenue

Max Petroleum (LON:MXP) has reported annual revenue of US$100.4mln, up 8%, as production increased at its operations in Kazakhstan.

Daily production was up 17% in the twelve months, to March 31, averaging 3,899 barrels of oil per day.

Max drilled 35 new wells into its shallower post-salt reservoirs during the year. The company has now drilled 103 of these wells since August 2006.

Activities in the year reflect a change in strategy to focus upon production rather than exploration.

"Max Petroleum has taken important steps this year to shift its focus from exploration to production,” said chairman James Jeffs.

“The changes have followed disappointing progress in adding to reserves from the post-salt, slower than expected production growth and limited advancement towards resuming drilling of the deep, pre-salt NUR-1 well.”

Oil reserves decreased over the course of the year due to certain well results, with the figure for proved and probable (2P) reserves reducing 13% to 9.5mln barrels from 10.9mln barrels at the same point in 2013 (though the company points to the fact that in the interim, reserves had increased from 8.6mln to 10.9mln by September).

Nevertheless, the company recognises that post-salt exploration now has limited remaining potential, and as such it reports a US$64.6mln impairment in today’s results.

“The disappointing operational news in the form of slower than expected production growth has made change more urgent, but improved efficiency was also a necessary and logical step given the stage of development of the group and its assets,” Jeffs added.

“The structural changes to the management and operations of the group which were made earlier in 2014 are now complete and are the start of an ongoing drive for improved efficiency”.

Jeffs said Max now offers an excellent platform to consolidate and grow oil and gas opportunities in Kazakhstan, and this opportunity is enhanced by the recently announced agreement with the influential Assaubayev family which proposes to take a majority stake in the company.

A vehicle of the Assaubayevs, is investing £37mln of new funds via a share subscription which will give it 51% of the company.

“If this transaction is completed, the investment should enable the group to fund its planned capital programme to develop its post-salt fields and maximise reserves and production. 

“In addition, Max Petroleum would be in a strengthened position to attract financial or industry partners to help finish its pre-salt NUR-1 well and to secure an extension of the exploration period of its Blocks A&E Licence in western Kazakhstan.”

He adds that Max would also be in a position to consider investments into complementary projects in Kazakhstan and across Central Asia.

View full MXP profile View Profile

Max Petroleum Timeline

Related Articles

oil well
February 13 2018
At Welch, work in recent months has focused on workovers and production optimisation.
1519654733_uranium.jpg
February 26 2018
Anfield Energy has a suite of attractive assets containing uranium and vanadium
oil well
June 18 2018
A cash flow model - assuming one new IOsorb plant is added each year between 2019 and 2021 - gives a price target of 35p/share

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use