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UPDATE - Range Resources makes steady progress in Trinidad

Last updated: 14:00 13 Nov 2014 GMT, First published: 15:00 13 Nov 2014 GMT

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--adds broker comment and target price--

Range Resources (LON:RRL) said it is now seeing the results of its recent investment as it reported a 15% increase output in the year to date.

The Trinidad focused on-shore oil group said it is currently producing 592 barrels a day, which also represents a 5% increase from when it last update on September 30.

Range said the increase is a result of continued development drilling (two wells have been drilled since that last report) and successful workover operations.

The completion of a recently announced US$50mln funding package will help expand operational activity and also bankroll its steam flood programme, the firm added. 

Steam flooding is expected to enhance recoveries from Range’s fields and work continues with LandOcean on technical studies ahead of planned water injection next year.

The company said one of its rigs is now headed for its next location on the Morne Diablo field, three others will re-start work once they have received final government permits and one is being upgraded for deep drilling. Another remains on long-term maintenance.

"We are now seeing the start of results from our investments in our Trinidad production projects, staff and rigs,” said chief executive Rory Scott Russell.

“We look forward to seeing steady progress with production continuing to ramp up in the coming months. 

“We expect to complete a number of additional shallow development wells by the end of the year by which time we will have several rigs drilling in parallel, as well as continuing to progress with our workover programme.”

Broker Cantor Fitzgerald maintains its buy recommendation on Range and set a target price of 3.3p.

“When the US$50m fund package from Core Capital completes, Range will be in a position to significantly expand its operational activity, including the waterflood programme,” said Cantor.

“Until then it is reassuring to see positive progress on production volumes. We maintain our BUY recommendation and TP of 3.3p.”

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