Europa Oil & Gas (Holdings) PLC (AIM:EOG) marked £2.2mln of first-half revenue as its part-owned Wressle field continued to perform “from strength to strength”.
In what the company described as its “strongest interim financial performance since H1 2014” the company reported a £700,000 pre-tax profit and noted £900,000 of net cash from operations.
Europa has in recent years focussed on developing Wressle and partnering for offshore exploration ventures, and, with these latest financial results now sees those effort begin to show in its bottom line.
Wressle has continued to exceed its initial production projections of 500 barrels of oil per day, instead yielding rates of 884 bopd plus 480,000 cubic feet of gas. As a result, Wressle more than doubled Europa’s production volumes to 208 bopd through the six months ended January 31.
Moreover, according to analysis conducted by consultant ERCE Equipoise, higher rates are possible at Wressle – up to 1,543 bopd – if facility constraints on gas production can be alleviated. Europa also noted that additional resources at Wressle, in the Wingfield Flags and Penistone Flags reservoirs, are to be reviewed also to potentially open up further reserves and development possibilities.
"We are delighted to bring you our outstanding financial results for the first half, which saw revenue quadruple to £2.2 million and a swing back to profitability from recent years,” said chief executive Simon Oddie.
“Europa's positive H1 performance was driven by excellent production result at our Wressle oil field in North Lincolnshire, which saw our average daily production more than double compared to H1 2021 and coupled with elevated oil prices, which are now exceeding US$100 a barrel.”
Europa, meanwhile, launched a farm-out process for its project offshore Morocco during the period and continued an ongoing farm-out process for its gas project offshore Ireland.
Elsewhere, more recently, in March, the company struck a deal to farm-in to a 25% stake in i3 Energy’s Serenity gas discovery in the North Sea where an appraisal will aim to unlock a field development. The deal, which will see Europa carry a portion of i3’s well costs, was supported by a £7mln equity raise.
Oddie highlighted: “we have now put in place the third leg of the business, the acquisition of a near-term appraisal and development opportunity.
“The year is shaping up to be transformational for both our diversified energy portfolio and our financial position."