LGO Energy plc has been notified by the Petroleum Company of Trinidad and Tobago Limited that overriding royalty rate reductions for the company's production at the Goudron Field in Trinidad have been approved.
The reductions will come in to effect from March 16, and will apply to sales made from February 1. These new royalty rates, which apply to production at oil prices below $50 per barrel, will see the royalty rate on the majority of barrels produced cut by over 40 percent to rates below 10 percent. This will have a net revenue benefit at current oil prices and production levels of approximately 10 percent to Goudron E&P Limited, LGO's wholly owned Trinidadian subsidiary which operates the Goudron Field.
LGO's Chief Executive Neil Ritson commented in a company statement:
"We are delighted that the mutual benefits of encouraging investment by reducing royalty rates at this time of lower oil prices have been recognized. LGO has responded by increasing the level of ongoing investment, as recently reported, and this will be good for the company, its investors and for Trinidad generally."
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