Stratic Highlights 1Q10 Financial, Operational Results

Stratic filed its Interim Financial Statements and accompanying Management's Discussion and Analysis for the quarter ended March 31, 2010. All amounts below are US dollars, unless otherwise stated.

Operations and West Don Development

  • Production from continuing operations of 731 bopd (2009: nil) with increase due to commencement of West Don production in late April 2009. Production from discontinued operations in Turkey of 293 boepd (2009: 240 boepd)
  • Northern Producer floating production facility on West Don successfully connected by pipeline in March 2010 to Brent oil export system, substantially reducing exposure to weather downtime; further work underway to optimize production
  • Plans under discussion for drilling a third production well in the southern part of the West Don field, potentially later in 2010
  • Revised operator mid case production forecast for remaining three quarters of the year of 6,000 bopd (Stratic share: 1,035 bopd)

Exploration/Appraisal and Pre-Development Assets

  • Crawford oil field development plan – new development concept utilizing multilateral wells to reduce risk and improve recovery; preliminary partner approval expected in third quarter 2010 with final development sanction expected in late 2010
  • Bugle North appraisal well drilled to total depth of 15,145ft and plugged and abandoned after encountering minor quantities of hydrocarbons; Bowmore appraisal well drilled last year also to be plugged and abandoned
  • Farm-out agreement signed in respect of F Quad licenses in Holland


  • Oil sales revenues from continuing operations in the UK of $4.3 million (2009: nil) with increase due to commencement of West Don. Gas revenues from discontinued operations in Turkey of $1.3 million (2009: $1.4 million)
  • Net loss of $10.8 million (2009: $6.8 million). Net loss from continuing operations of $10.0 million (2009: loss $5.7 million). Net loss from discontinued operations of $0.8 million (2009: $1.1 million)
  • Capital expenditure of $5.5 million (2009: $16.1 million), mainly on West Don and the Bugle North well in the UK, and on the block 17 exploration well in Syria
  • Cash and cash equivalents (including restricted cash) of $2.2 million at quarter end (December 31, 2009: $7.4 million); bank debt (excluding letters of credit) of $49.0 million and convertible notes of $64.5 million totaling $113.5 million at quarter end (December 31, 2009: $112.5 million), making net debt at quarter end of $111.3 million (December 31, 2009: $105.1 million)
  • Net debt at May 21, 2010 reduced to $70.6 million following receipt of proceeds from the sale of our Italian and Turkish businesses

Disposal Program

  • • Sale of the Company's Turkish business agreed and completed in May 2010
  • • FirstEnergy Capital appointed to advise on the sale of all or part of the Company's interest in the Crawford field with a target completion date before year end

Kevin Watts, Stratic's President and Chief Executive Officer, commented, "As outlined in our annual results issued last month, we are continuing our disposal program in order to eliminate bank debt and balance future capital commitments. We continue to manage our capital extremely carefully, as we shift the strategy of the company away from existing high cost areas to lower cost areas in which we can acquire and exploit new growth opportunities."