Echo Energy PLC (LON:ECHO) has told investors it is looking positively to advance value creation opportunities, as it remains “well-positioned” amid the challenges facing small cap oil and gas firms in 2020.
In its financial results statement for the twelve months ended December 31, 2019, the company confirmed a stronger end to the year, with net production averaging 2,505 barrels oil equivalent per day (bopd) in the months of November and December.
A review of reserves at the end of 2019 confirmed a reserve base of 3.8mln barrels oil equivalent (boe).
Operationally, the company completed well and seismic programmes during the year while on the corporate front it conducted a successful portfolio restructuring.
More recently, in the current period, the company has progressed a key refinancing and it is now working on low-cost opportunities to grow production.
"We started 2019 with the seismic acquisition campaign across Tapi Aike, safely acquiring 1,200km² worth of quality data on schedule and on budget and then ended the year with our first well in the Tapi Aike block, the culmination of a tremendous amount of work,” Martin Hull, Echo's chief executive said in the results statement.
“During the year we successfully restructured our portfolio, relinquishing assets without future growth, 'rightsized' our interest in Tapi Aike and made the important acquisition of producing assets with a strong reserves base in Santa Cruz Sur.
“This brought cash-generation into the business along with a pipeline of development opportunities and additional near field exploration potential, with a second exploration well spud before year-end.”
He added: “Although 2020 has brought with it some very serious global challenges, the work Echo accomplished in 2019, and the team that we have in place, means we are well-positioned to meet these challenges and maximise the value creation potential from our existing portfolio and look to positively move forward with further future value creation opportunities."
In terms of financial results, the company reported US$2.6mln of revenue, including US$1.4mln of oil sales – with the average realised oil price marked at US$51.52 per barrel. It had US$3.1mln of operational costs and spent US$600,000 on exploration.
It reported a £10mln loss from continuing operations, practically in line with the US$9.7mln loss for 2018.
The company ended December 2019 with £1.69mln of cash and equivalents.