Ithaca Energy Inc, a Canadian independent oil and gas company with exploration and development assets in the UK North Sea, announced its results for the first quarter which ended March 31, 2008.
In the three months to March 31, 2008 total assets increased to US$ 150.9m (US$ 117.0m as at December 31, 2007) representing the two wells drilled and ongoing capital expenditure on the Jacky platform. Cash balance at quarter end stood at US$ 58.6m (US$ 96.2m as December 31, 2007).
Net loss for the quarter increased to US$ 5.5m (loss US$ 0.1m for 3 months to March 31, 2007), due to increases in general and administrative expenses, increased depreciation and amortisation on a significantly greater asset base and a foreign exchange loss resulting from a 4.2% appreciation of the US dollar versus the Canadian dollar on the 2007 equity proceeds. Future funding and revenues are expected to be largely denominated in US dollars, thereby mitigating this foreign exchange exposure.
There is a strengthened operational management team with the appointment of Iain McKendrick as Chief Operations Officer and Steven Turner as Chief Financial Officer and additional main Board appointments of Jack C. Lee and Mr. Bradley Hurtubise as Non-executive Directors.
Operationally, the Polly prospect well was drilled and interpreted to have intersected 14.5ft of net hydrocarbon-bearing sand. Manuel prospect well was drilled and encountered hydrocarbons throughout the section but the sands were not of reservoir quality and the well was abandoned.
Events following March 31, 2008 include those in April 2008, Athena 14/18-17 well was drilled to test a possible southern extension of the accumulation. The well penetrated the Lower Cretaceous Leek sands and although the Leek formation was found to be oil-bearing, it was of lower quality than is found in the main Athena Reservoir and the well has been suspended for later use in the wider Athena development scheme. A 66.67% interest was acquired in the Stella and Harrier Shallow discoveries. This new core asset will be added to the borrowing base facility being negotiated with a group of leading UK North Sea sector banks. Appraisal and development drilling is contemplated for early 2009. A US$ 60m pre-development plan credit facility was signed with Royal Bank of Scotland.
Lawrie H. Payne, Chief Executive Officer said, "Ithaca Energy continues to see strong growth in its asset base. The Company has an active drilling program for the rest of the year, including a further well on Athena due to spud in early June and the completion of Jacky to bring this key element of the wider Beatrice project onstream by year end. Ithaca Energy remains on track to deliver its development program as previously announced."
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