Premier Oil PLC (LON:PVR) has told investors that its strong operational performance continued into 2017, with production averaging 82,600 barrels oil equivalent per day in the first four months of the year.
In an update ahead of its AGM later this week, on Wednesday May 17, the oiler revealed it is sticking to its full-year guidance for 75,000 bopd and noted that it will update its outlook once the summer’s maintenance period is complete.
The company highlighted that at US$13.7 per barrel the group’s operating costs were 11% below budget while it now also expects materially lower capital costs for the year at US$350mln down from US$390mln.
Premier noted that the Catcher field development, a key North Sea growth project, is on schedule to achieve ‘first oil’ later this year, meanwhile, the design contracts for the Tolmount project have now been awarded and it is expecting to reach project sanction by the second half of next year.
Offshore Mexico, the company expects to kick off a new exploration well by the end of May.
The company also noted that the implementation of its proposed refinancing is continuing, highlighting that the Court Schemes of Arrangement are due to formally commence today.
Presently, the company has net debt of US$2.8bn and it said it was marginally free cash flow positive for the four month period.
"Premier's strong operational performance continued into 2017,” said chief executive Tony Durrant.
“Production is above budget, the E.ON transaction has already reached payback, costs continue to be managed downwards and Catcher is on track for first oil later this year.
He added: “We plan to be cash flow positive in 2017 with more significant debt reduction in 2018.
“We look forward to the spudding of the Zama prospect in Mexico, a potentially transformational well for Premier.
“Our refinancing, shortly to be completed, incorporates a plan for net debt reduction and, over time, selective investment in new projects. We are ahead of plan."