Westmount Energy Limited (AIM:WTE, OTCQB:WMELF) told investors in its interim results statement that it is well capitalised with a minimal cost base and investment exposure to the next round of high impact drilling opportunities offshore Guyana.
It highlighted that Guyana's economic transformation, driven by investments by international oil companies such as Exxon, has continued apace and it is now a significant oil producing nation.
The company, which invests in exploration companies in Guyana, in the results for the six months ended 31 December 2022 highlighted that key drilling decisions are expected to be made in the second half of 2023.
Partners in the Canje and Kaieteur joint ventures are currently continuing work to identify optimal drill targets and are working on the environmental permits for those projects, it added.
Westmount ended December with £860,000 of cash and a subsequent return of capital from an investment added a further US$356,000. It added that the exploration companies it invests in are currently well funded for their participation in planned near-term opportunities.
“While patience has been required, we anticipate that licence timeframes and relinquishment drivers should help to crystalise some drilling decisions from the second half of 2023,” Westmount chair Gerard Walsh said in the results statement.
“Our primary investee companies Cataleya Energy Corporation (CEC), JHI Associates Inc (JHI) and Eco Atlantic Oil and Gas (EOG) are currently well funded for participation in near-term drilling opportunities offshore Guyana.
“In some cases, investee portfolio diversification may also offer exposure to additional high impact drilling events, in particular in the emerging Orange Basin, South Africa.
“Furthermore, the launch of the 2022 Guyana Licensing Round, under less benign fiscal terms, may bring renewed focus on the incumbent junior players and possible consolidation manoeuvres. We believe all is yet to play for.”
Westmount’s portfolio comprises a 5.3% shareholding in CEC (a 20% stakeholder in Kaieteur), a 7.2% shareholding in JHI (a 25% stakeholder in Canje), a 0.4% interest in EOG (which has 15% of the Orinduik block) and a minor shareholding in Ratio Petroleum (which has 25% of Kaieteur).
The company also noted JHI’s proposed acquisition of exploration assets in the North Falkland basin, through a deal to buy Argos Resources.