Zephyr Energy PLC (AIM:ZPHR, OTCQB:ZPHRF) is expecting substantial progress in key areas in the coming months, as the Paradox project in Utah advances toward development.
Specifically, Zephyr is working to secure gas sales and export arrangements, as well as advanced talks to potential partners to enable an accelerated drill programme, to step up the number of wells at Paradox.
In the six months ended 30 June, the main highlight was Zephyr's successful well test, which delivered a peak rate of 2,848 barrels of oil equivalent per day without pressure drop, ranking in the top 6% of similar US wells. The result suggested that future 10,000-foot lateral wells at the Paradox project could yield 3.6 million barrels of oil equivalent each.
A newly update competent persons report is due 'shortly' and is expected to further underline the opportunity in the Paradox. Meanwhile, the Zephyr team is focused on practical matters.
"We have continued to invest significant resources into the development of our flagship operated project in the Paradox Basin," chief executive Colin Harrington.said.
"The production test demonstrated the considerable scale and potential of the Paradox project and reaffirmed that the Cane Creek reservoir can be developed in a highly productive manner, on par with some of the leading oil and gas plays in the US."
He added: "We look forward to the coming months with confidence as we continue to open-up the next prolific oil and gas basin in the U.S., and we look forward to providing regular updates as we advance through the next phase of our development."
Zephyr, which also generates income from the stakes in non-operated well, on Tuesday released financial results for the six months to 30 June 2025, in which the company said continues to deliver strong returns.
First half revenue totalled US$6.3 million (net to Zephyr), though volumes were reduced compared to last year due to a number of factors, including a temporary shut-in of six wells and natural well decline. And, Zephyr reported a gross profit of $3.1 million.
Production in the period averaged 684 barrels of oil per day, to reach a tally of 123,798 barrels for the six months.
Zephyr expects to see higher volumes in the second half, as its new acquisition of wells kicked in from June.
Harrington told investors that Zephyr remains focused on opportunistically growing the non-operated portfolio, whilst highlighting that June's acquisition was the first to be supported by the firm's Zephyr Hawk LLC joint venture, which is able to back transactions to the tune of $100 million.