viewCadogan Petroleum Plc

Cadogan Petroleum expects quick restart at Monastyretska


In Ukraine, the group’s assets are located near to Poland and Romania

Ukraine oil well

Quick facts: Cadogan Petroleum Plc

Price: 4.8 GBX

Market: LSE
Market Cap: £11.32 m


• Ukraine-focused oil and gas producer with rising production profile

• New well, Blazh-10, on Monastyretska (Blazhiv) licence has flowed at 185 barrels per day, lifting production to 400 bpd daily

• Acquired option to take 22% stake in Italian oilfield services engineering firm Proger


What it owns

Cadogan Petroleum PLC (LON:CAD) holds interests in Western Ukraine and a 90% interest in Exploenergy, an Italian company, which has filed applications for two exploration licences in the Po Valley, in Northern Italy.

In Ukraine, the Group’s assets are located near to Poland and Romania in the prolific Carpathian basin and the opposite side to the zone of military confrontation with Russia.

Cadogan has agreed to sell the Debeslavetska and Cheremkivsko-Strupkivska gas fields to local group Nadra Ukrayny.

It also agreed to sell the Gazvydobuvannya legacy asset for US$2.8mln.

Monastyretska’s (Blazhiv) oil production is expected to restart soon after a new 20-year production licence was awarded in December.

Production has increased nearly five-fold over the last couple of years. It is set to double again following the successful drilling of the latest development well, Blazh-10.

How it's doing

Cadogan reported a production rate of 297 barrels of oil equivalent per day in the first six months of 2019, up 27% year-on-year, while the average in June was 387 boepd.

Since then, production has jumped to more than 400 barrels per day following the successful Blazh-10 well.

This was drilled to a target depth of around 3,400 metres targeting the Yamna sandstone reservoir, which already produces in the three online wells in the licence.


Earlier in 2019, Cadogan also acquired an indirect option over industrial group Proger Ingegneria through the provision of a convertible loan up to the value of €13.4mln.

The option can be exercised at any time between the sixth and 24th months following the execution date of the loan agreement.

Cadogan also has the right to designate two out of the seven directors.

In exchange for providing the loan, Cadogan has a call option to buy 33% of the participating interest that PMP has in Proger Ingegneria, giving it an indirect 22% interest in Proger. 

The company expects its indirect interest in Proger to rise to 25% following a capital increase.  

In the year to 31 December 2018, Proger reported a 24% gain in earnings (EBITDA) to €11.3mln while pre-tax profit increased nearly 4% to €6.1mln.


Production revenues increased by 15.7% in the first half despite a 15.6% decrease in realised oil prices.

Overall group revenue was, however, down 37.5% compared to last year because of lower gas traded volumes.

Cadogan reported a US$2.56mln profit for the period, supported by a US$4.8mln increase in the fair value of a convertible loan since its signing in February.

Net cash at the end of June totalled US$13.7mln, while cash flow was reported at US$1.2mln. The company said this level of cash is more than sufficient to sustain on-going operations.

Inflexion points

  • Results from Proger and benefits from companies working together more closely in future
  • Production from Blazh-10 stabilises at a good rate
  • Fady Khallouf has taken over from Guido Michelotti as the company’s chief executive

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