Interim Results for the Six Months Ended 31 January 2021

27 April 2021

Egdon Resources plc (AIM: EDR), a UK-based exploration and production company primarily focused on the hydrocarbon-producing basins of onshore UK, today announces its unaudited results for the six months ended 31 January 2021 (“the period”). 

Overview and Highlights

Operational and Corporate

  • Production during the period was 92 barrels of oil equivalent per day (“boepd”) (H1 2020: 178 boepd) in-line with guidance of 90-100 boepd
  • Completion of the farm-outs for the Resolution and Endeavour gas discoveries (P1929 and P2304) to Shell Oil U.K. Limited
  • Deferral of the Resolution 3-D seismic survey to February 2022
  • Planning consent extended to 31 December 2021 for the drilling of North Kelsey-1 (PEDL241)
  • PEDL143 Licence was relinquished
  • Commencement of free-flow test production at Wressle following safe and successful operations to recomplete and reperforate the Ashover Grit reservoir interval

Financial Performance

  • Oil and gas revenues during the period of £0.424 million (H1 2020: £0.675 million) as a result of declining production and weaker prices
  • Loss of £0.763 million (H1 2020: £1.044 million) before impairments
  • Overall loss for the period of £1.039 million including £0.276 million of impairments (H1 2020: loss of £3.235 million, £2.191 of impairments)
  • Cash and cash equivalents of £2.422 million (H1 2020: £0.781 million)
  • Net current liabilities as at 31 January 2021 of £0.126 million, which includes liability for £0.962 million convertible loan (H1 2020: £Nil) and £0.417 million deferred consideration for Wressle (H1 2020: net current assets of £0.370 million; including liability for Wressle deferred consideration of £0.417 million)
  • Net Assets at 31 January 2021 of £25.658 million (H1 2020: £27.812 million)
  • £1 million loan facility secured with Union Jack Oil plc
  • £1.051 million convertible loan notes issued following approval at a General Meeting in January 2021

Subsequent Events

  • On 26 February 2021, Egdon submitted a planning application for a side-track drilling operation, associated testing and long-term oil production at the Biscathorpe-2 well site 
  • On 23 April 2021, a memorandum of understanding was executed with Creative Geothermal Solutions Limited (“CGS”) to progress geothermal projects within Egdon’s existing portfolio and to look at wider opportunities

Outlook

  • Production guidance for the full year of 110-130 boepd.(2020: 145 boepd)

Our key operational focus for the coming period will be:

  • Progressing the proppant squeeze at the Wressle oil field to attain target production of 150 boepd net to Egdon
  • Securing planning consent for the Biscathrope-2Z side-track, testing and long-term production
  • Progressing a farm-out of North Kelsey-1 and Biscathorpe-2Z with a view to drilling during 2021-22
  • Progressing the acquisition of the planned 3-D seismic survey over the Resolution and Endeavour gas discoveries in February 2022
  • Progressing drilling plans to target incremental oil production / near field exploration opportunities at the Keddington oil field and field redevelopment at Waddock Cross
  • Developing a detailed plan for geothermal repurposing of either or both of the Dukes Wood and Kirklington wells.
  • Subject to lifting of the current moratorium on hydraulic fracturing operations for shale-gas, progressing plans for further testing of our extensive Gainsborough Trough unconventional resources assets

Online Presentation

The Interim Results and Business Update presentation is available on the Egdon website: www.egdon-resources.com

Commenting on the results, Philip Stephens, Chairman of Egdon said;

“The most significant event during the period was the completion of site and recompletion works and commencement of oil flows at Wressle. We continue to await consent to proceed with the proppant squeeze in order to bring production up to the expected level of 500 bopd which will have a meaningful impact on our production and cash flow.  Additionally during the period, the Company completed refinancing arrangements providing working capital to pursue our key objectives.  We continue to proactively screen new low carbon Energy Transition opportunities, and are pleased to have announced an initial MoU to explore the possibilities for geothermal repurposing of some of our existing assets.    We look forward to pursuing our revised strategy in the context of an improving operating backdrop compared to the last 12 months.”

View or Download Jan 2021 Interim Results

View or Download 2021 Interim Results Presentation and Business Update