Zephyr Energy PLC (AIM:ZPHR, OTCQB:ZPHRF) chief executive Colin Harrington described the first six months of 2022 as “another transformational time” for the company, which has both expanded its production and also advanced it primary project in Utah’s Paradox basin.
The oil and gas company generated some US$25.9mln of revenue from its portfolio of non-operated production wells in the Williston Basin, with earnings (adjusted EBITDA) coming in at around US$19mln and net profit after tax reported at US$17.4mln.
It had some US$12.8mln of cash and equivalents, as of 3 September.
At its flagship Paradox project, the AIM-quoted company is advancing towards the start of an extended well test – during the reporting period the project was boosted by a new competent persons report, whilst preparation began for the State 16-2 LN-CC well’s production test, meanwhile, volumes produced in the prior test were sold.
Zephyr is at the same time planning a new ‘high impact’ three-well drill campaign in Utah, with drilling operations planned to start later this year. The new programme of wells will be designed to help delineate the full potential of the Paradox project, Zephyr said.
Recapping the first half, Harrington highlighted: "This year started with our major acquisition in the Williston Basin, which we expect will enable Zephyr to generate revenues of between US$35-40mln over the course of 2022, with sufficient cash flow generated to fuel all envisioned upcoming development activity.
Adding: “We continued to make significant in-roads across both our Williston assets and the Paradox project, serving to grow the group and deliver on our self-sustaining strategy of using our non-operated, cash generative portfolio to enable development of the Paradox and, by extension, to open up the next prolific onshore U.S. oil and gas play,” Harrington said.
"The rest of this year promises to be an equally important time for our shareholders as we commence the extended production test on our State 16-2LN-CC well and kick off the proposed three well drill programme on the Paradox project.”
Zephyr’s plans for Paradox were further supported by a recent acquisition in which, along with some well bores, saw the company take ownership of nearby infrastructure.