Ithaca Production on Target for 2013

North Sea-focused Ithaca Energy said Tuesday that it is looking forward to an active second half of the year, after reporting a boost in production to 9,138 barrels of oil equivalent per day from 4,132 boepd in 1H 2012.

Ithaca's production benefited from its acquisition of Valiant Petroleum in April. The company confirmed that the inclusion of Valiant's production means that it full-year 2013 production is expected to be at the lower end of its pro-form annual guidance range of between 14,000 and 16,000 boepd.

Ithaca said that its production is expected to benefit from recent operational activities and planned work programs. These include an additional production well on the Don Southwest field, which was drilled and brought online in late June 2013, and the drilling of a water-injection well in the same area of the field, which is nearing completion.

The company added that good progress continued to be made on a work program that is required to enable the start-up of the electrical submersible pump on the Causeway field. However, Ithaca also noted that achieving the ESP start-up on the Causeway field in 4Q 2013 is subject to TAQA Bratani delivering an on-time turnaround of six weeks on the North Cormorant platform to supply power to the Causeway well ESP package.

Meanwhile, production from the Athena field has been improved after a repair was successfully completed on a well in July 2013.

At the Greater Stella Area Development, Ithaca noted that the first development well is progressing as planned with drilling currently ongoing in the horizontal reservoir section of the well, while "excellent progress" is being made on the subsea infrastructure installation work program.

Analysts at London-based investment bank Cenkos Securities commented that "the transformational developments in the Stella area" will potentially add "significant value" to the company from 2014.

Ithaca reported revenue of $188 million for 1H 2013 (1H 2012: $76.3 million), producing a pre-tax profit of $55.7 million (1H 2012: $43.2 million).

Ithaca CEO Iain McKendrick commented in a company statement Tuesday:

"In the first half of the year we have both doubled production and operating cashflow and importantly diversified our producing asset base to 11 fields.  The Greater Stella Area development is moving forward rapidly and with the integration of the Valiant acquisition now completed, including restructuring of the UK exploration portfolio, we look forward to an active second half of the year."


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