UK-based Europa Oil & Gas said that it was "poised to see an increase in production, revenue and cash flow" in spite of the current oil price challenges as the firm released Wednesday its financial results for the six-month period to January 31, 2015.
Europa said that it had been through a period of increase activity in recent months, with the drilling of two wells that targeted up to 5 million barrels of gross prospective resources. This drilling resulted in flow test rates of 710 barrels of oil equivalent per day (boepd) from the Wressle discovery and the indication of a working petroleum system in the PEDL181 onshore block.
The firm has also seen the interpretation and evaluation of seismic surveys over the Porcupine Basin licenses, offshore Ireland, in which Europa has a 15-percent interest. Europa's partner, Kosmos Exploration, estimates that these licenses contain gross prospective resources approaching 1.5 billion barrels.
Meanwhile, Europa completed the farm-out of one of its French licenses to the leader onshore operator in the country, Vermillion. The French firm is providing a carry of exploration costs of up to EUR 4.65 million ($4.9 million) in exchange for an 80-percent stake in the license.
Europa CEO Hugh Mackay said in a company statement:
"We are confident the momentum that has been established across our portfolio of multistage projects will be maintained in the second half of 2015 and beyond: a CPR [competent person's report] on our Irish and UK licenses; an extended well test on the Wressle discovery that may lead to a fast-track development; and the results of our applications in the 14th UK onshore licensing round are anticipated following the general election. In addition, we are working with our new farm-in partner and operator Vermilion Energy to advance our Tarbes permit in onshore France and the farm-out of our Bearn des Gaves permit onshore France is ongoing.
"Outside our existing portfolio, we are evaluating a number of new opportunities, as we look to leverage our proven technical expertise to generate significant value for shareholders. This is precisely what we have done with our Irish licenses, which our partner Kosmos Energy estimates have gross mean un-risked prospective resources of up to 1.5 billion barrels of oil. We are intent on building the very high reward component of our portfolio. Our recent technical work indicates that there is substantial exploration upside in the Porcupine Basin and we will be bidding for new licenses in the 2015 Irish Atlantic Margin licensing round."
Europa reported revenue of GBP 1.3 million ($1.9 million) for its first half of its 2015 financial year compared with GBP 2.1 million ($3.1 million) for 1H 2014. The firm also registered a pre-tax loss of GBP 1.4 million ($2.1 million) for 1H 2015, compared to a profit of GBP 0.5 million ($735,000) for 1H 2014.
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