Bahamas Petroleum Company (AIM:BPC ) said it has seen a substantial increase in field activities across its assets as it continues to build towards “material, profitable production.”
The Caribbean and Atlantic margin-focused oil and gas firm completed its £25m merger with international oil and gas exploration company, Columbus Energy Resources back in August.
Commenting on recent activity, Simon Potter, CEO, said BPC has since sought to leverage its own proven operating experience and skills in pursuit of a “simply short-term aim”.
He highlighted that the company's main objective was “to deliver cash flow from operations in Trinidad sufficient to cover the local operating costs, and thereafter to ultimately cover the overheads of the enlarged group as we build to material, profitable production.”
Potter said BPC has been “extremely busy” in taking the first steps to realising performance improvements in support of this aim in a short period of time since assuming control.
In Trinidad and Tobago, production decline has ended, with BPC seeing early signs of sustainable overall production increase consistent with its strategy and plan. Its target baseline production rate of 500 barrels of oil per day by the end of 2020 remains unchanged.
To date, plans for enhanced oil recovery (EOR) projects have been submitted for approval to Trinidad and Tobago’s regulatory authorities. Meanwhile, a CO2 injection project production well work program has now been approved with workover to commence imminently.
The company has also defined a work program to appraise its Saffron discovery. This includes developing a drill plan for Saffron #2 which has a target spud date of Q1 2021.
In addition, multiple prospects have been identified across the South West Peninsula portfolio which is estimated by management to each have +10 million barrels of oil per day of recoverable resource potential, each with an equivalent in size to the Saffron discovery.
In Suriname, the company highlighted that a drill plan, work program and environmental studies for the Extended Well Test (EWT) has been submitted for approval to regulatory authorities and has a target spud date for the first well in the first quarter of 2021.
“We are pleased to be seeing the first green shoots of operational improvement, with arrested production decline and, albeit modest, production growth. Collectively, this gives us great optimism in being able to deliver on our value-creating strategy for the future,” said Potter.
In parallel, the group said it is making “rapid progress” to the commencement of drilling the Perseverance #1 well in the Bahamas which is expected to occur before the end of the year.
Potter highlighted that a separate and distinct operational management and execution group remains entirely focussed on the successful delivery of the drilling at Perseverance #1.
Shares in Bahamas Petroleum Company have increased by over 10% in the past month to open 10.64% higher at 2.6p this morning following the announcement.
3 Reasons to Follow Bahamas Petroleum Company
MultiAsset Company
BPC is becoming a multi-asset ‘full cycle’ oil and gas company, with a range of exploration, appraisal, development and production assets and licences, located offshore in the waters of The Bahamas and Uruguay, and onshore in Trinidad and Tobago, and Suriname.
Positive Newsflow Imminent
The company is currently on-track for drilling an initial exploration well in The Bahamas, Perseverance #1, in late 2020 / early 2021, with the well targeting recoverable P50 prospective oil resources of 0.77 billion barrels, with an upside of 1.44 billion barrels.
Successful Acquisitive Growth
As a result of its merger with Columbus, BPC has been granted access to high-impact exploration wells in The Bahamas, five producing fields, two appraisal / development projects Trinidad, and an expansive frontier exploration acreage offshore Uruguay and Suriname.
BPC believes the merger will allow both groups to provide something different from within that business cycle to the combined entity and that together the asset base is ‘more robust, has broader interests and is, as a consequence, more financeable and thus more valuable.’
“With the completion of the merger of BPC and Columbus, we today become a single company, in pursuit of a single-minded vision: the creation of a revenue generating, full-cycle, Atlantic margin exploration and production business,” said Potter in August.
He added, “Going forward, BPC is an exploration and production business, intent on generating reliable, growing production cash flows capable of supporting exploration activities, and which together will create significant value for all stakeholders.”
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