Stratic Earmarks $10MM for E&P in UK, Syria
Stratic ended 2009 with net debt of $106.5 million, comprising cash (excluding restricted cash) of approximately $6 million, bank debt of $48 million and subordinated convertible loans of $64.5 million.
Under recently agreed amendments to the bank facility, an additional short-term line of credit of approximately $10 million is now available for general corporate purposes, providing increased flexibility to fund the business near-term. This is repayable, together with scheduled repayments under the facility of approximately $25 million which have been deferred from the end of 2009, from the proceeds of sale of the Company's Italian business amounting to an estimated $45 million, expected to complete around the end of the first quarter, 2010.
In 2010, based on a Brent oil price averaging $75 per barrel, Stratic expects to generate approximately $35 million of production revenue after royalties and field operating costs. This includes revenues from our Turkish business up to the mid-year, following which the business is assumed to have been sold. Planned development expenditure in 2010 is forecast to be approximately $20 million, primarily on West Don including the third production well under consideration. No significant development capital expenditure is expected on the Crawford field in 2010, pending project sanction targeted later in the year, at which point additional finance will be required to be in place. Subject to banks' approval, the existing bank loan facility is likely to be available to finance a portion of Stratic's share of development expenditure on the field.
Committed exploration and appraisal expenditure in the UK and Syria for 2010 currently stands at about $10 million, with a further $10 million earmarked for exploration in new areas, subject to available cash flow in the second half of the year. During 2010, based on the current facility projection, Stratic expects to make loan repayments to its banks totaling approximately $35.5 million, substantially reducing the projected loan to an outstanding balance at year end of approximately $12.5 million.
- EnQuest Commences Drilling at West Don Field (Aug 09)
- EnQuest Increases Reserves in North Sea with Stratic Acquisition (Aug 03)
- Stratic Highlights 1Q10 Financial, Operational Results (May 28)