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Columbus Energy Resources PLC

Columbus Energy says it will deliver 2018 production target

With newly acquired assets Columbus showed a step-up in production volumes through the third quarter

oil and gas operations
Output averaged 735 bopd in the quarter

Columbus Energy Resources PLC (LON:CERP) told investors that it is on track to deliver on its production target for 2018, with output due to top 1,000 barrels of oil per day by the end of the year.

The Trinidad-focused oil firm, following the recent completion of the Steeldrum acquisition, on Wednesday released a operations update for the third quarter.

READ: Columbus Energy completes Steeldrum acquisition

Significantly, as the transaction’s effective date was 13 July the reported volumes include a material contribution from the Steeldrum assets.

"It has been an exciting few months for all at Columbus as we sought to complete the acquisition of Steeldrum after it was announced in early Q3 2018,” said Leo Koot, Columbus executive chairman.

"We are already seeing the real benefits of having increased optionality for production and joining the two entities together provides a stronger platform for growth and helps de-risk our portfolio in Trinidad.”

Production averaged 735 bopd for the three month period, compared to 553 bopd in the comparative period of 2017. Volumes peaked at 879 bopd during the quarter, and, the company highlighted that in September the rate averaged 751 bopd.

Some 62,658 barrels of oil were sold, and the company said it generated $3.85mln of gross revenue for the quarter. The realised sales price averaged $60.80 per barrel, which is broadly consistent with the comparative period, and, the price peaked at $62.14 per barrel in September.

It highlighted ‘strong progress’ with the delivery of the company’s key strategic goal of being cash flow positive, generating around $540,000 of positive cash flow after spending on what it described as an ‘intensive field maintenance and well workover campaign’.

Columbus ended the quarter with $1.97mln of cash.

Integration and opportunity

The company said that the integration of the Steeldrum assets will complete in the fourth quarter, and, the enlarged team is presently working to identify and implement opportunities to increase production, with all work funded out of cash flow.

Leo Koot added: "We can see many opportunities for achieving quick production growth across the new Columbus portfolio, which now includes five producing fields, one development project and our highly prospective South West Peninsula exploration opportunity, and we will be implementing those projects in the coming weeks with the objective of exceeding 1,000 bopd in Trinidad by the end of 2018.

“We also plan to bring the Snowcap Field in the Cory Moruga Licence onto production through re-starting the Snowcap-1 well before the end of 2018, using existing infrastructure and available funds, following the received formal confirmation of the extension of the licence by the Trinidad authorities.

“We believe this will achieve a quick production ‘win’ for Columbus towards the year-end production target.”

Quick facts: Columbus Energy Resources PLC

Price: £0.03

Market: AIM
Market Cap: £24.05 m
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