TIDMSQZ
RNS Number : 2891E
Serica Energy PLC
29 June 2023
Serica Energy plc
("Serica" or "the Company")
Corporate Presentations for Annual General Meeting
London , 29 June 2023 - Serica Energy plc (AIM: SQZ), announces
that at the Annual General Meeting today, presentations will be
made by both the Chair, Tony Craven Walker, and the Chief
Executive, Mitch Flegg. Copies of the presentations will be
available on the Company website www.serica-energy.com under
Investors/Presentations.
Production
2023 group production remains strong. The monthly net production
(in boe/d) for each of the assets in the portfolio is as
follows:
Jan Feb 23 Mar Apr 23 May Jun 23
23 23 23
(to date)
Bittern 7,403 4,982 6,593 3,650 5,101 6,339
Bruce 5,558 5,385 8,187 7,574 8,645 7,963
Columbus 2,785 2,155 2,661 2,147 1,540 2,480
Erskine 1,846 1,700 1,369 1,425 1,815 1,930
Evelyn 5,844 3,589 5,373 3,937 4,357 6,074
Gannet E 4,387 4,416 11,934 7,421 9,201 10,649
Guillemot W&NW 167 151 328 102 232 279
Orlando 2,265 4,102 4,024 3,899 3,367 3,343
Rhum 14,581 12,980 15,228 18,389 18,791 17,525
Total 44,836 39,460 55,697 48,544 53,049 56,582
Net production for the combined Serica and Tailwind portfolios
has averaged over 49,000 boe/d YTD (to 24 June). There will be
several planned maintenance programmes on our assets this summer.
Some of these outages have just commenced and some will occur
during the second half of the year so full year 2023 production
guidance remains unchanged at 40,000 - 47,000 boe/d.
Costs
Unaudited production costs for the group are running at
approximately US$17/boe YTD on a proforma basis including Tailwind
assets from 1 January 2023. This in line with our expectations for
the period as inflationary pressures continue within the UK North
Sea.
Commodity Prices
Year to date realised commodity prices of approximately
100p/therm for gas and US$64/bbl for oil on a proforma basis
incorporating Tailwind assets from 1 January 2023. This includes a
mix of volumes sold at spot prices and volumes sold at fixed
prices. The remaining fixed price volumes are:
Gas: 50,000 therms/day at 41p for Q3 2023
Oil: 11,000 bbls/day at US$61 for 2H 2023
5,000 bbls/day at US$70 for 1H 2024
2,700 bbls/day at US$80 for 2H 2024
Capital Expenditure
Serica has a strong balance sheet with significant net cash
enabling it to continue its onging programme of investing in the
portfolio to add value. Serica is also a current UK Ring Fence
Corporation Tax and EPL payer. The costs of our 2023/4 Capital
Expenditure programme can be offset against our taxable revenues
and will further qualify for the EPL investment incentives designed
to encourage companies to invest.
The acquisition of the former Tailwind assets has added a range
of opportunities to Serica's hopper of potential future organic
investments.
Serica's planned 2023/24 investment programme includes two Light
Well Intervention Vessel campaigns (2023 & 2024) on the Bruce
and Keith fields and a four-well drilling campaign in the Triton
Area (Bittern B1z, Gannet GE-05, Evelyn Phase 2 and a Guillemot NW
infill well).
Following detailed interpretation of the North Eigg exploration
well results, Serica has decided that there is an insufficient
accessible volume of oil to justify re-entering the suspended well
and drilling a sidetrack. Following consultation with the NSTA, we
have elected to go into the second term of the P2501 Licence for
the purpose of completing the abandonment of the North Eigg well.
Only the area immediately around the well necessary for the
abandonment is being retained with the remainder of the block being
relinquished.
Mitch Flegg, Chief Executive, commented:
"Serica has established a diverse and balanced portfolio in the
UKCS. The acquisition of Tailwind has provided an additional
independent production hub and has resulted in a more balanced
split between oil and gas. The benefits of this are already
becoming apparent with production remaining at consistently high
levels since completion of the deal.
In 2022 the reserves added to the combined Serica and Tailwind
portfolios were more than three times the volume of oil and gas
produced. This is an outstanding reserves replacement record and we
are already working on an exciting programme of value-adding
investment opportunities across the enlarged company in
2023/24.
We are disappointed that we have been unable to identify a
viable sidetrack target for the North Eigg exploration well.
Especially given the current licencing and fiscal uncertainties for
UK North Sea activities, we believe that a disciplined approach to
investment is important. In the near term, this means maturing
better short-cycle investment opportunities within our
portfolio.
As previously announced, Serica is proposing a final dividend of
14 pence per share, bringing the total dividend in respect of the
last financial year to 22 pence per share. We are aiming to
maintain or increase the dividend in future years."
Regulatory
This announcement is inside information for the purposes of
Article 7 of Regulation 596/2014 as retained in the UK pursuant to
S3 of the European Union (Withdrawal) Act 2018.
The technical information contained in the announcement has been
reviewed and approved by Fergus Jenkins, VP Technical at Serica
Energy plc. Mr. Jenkins (MEng in Petroleum Engineering from
Heriot-Watt University, Edinburgh) is a Chartered Engineer with
over 25 years of experience in oil & gas exploration,
development and production and is a member of the Institute of
Materials, Minerals and Mining (IOM3) and the Society of Petroleum
Engineers (SPE).
Enquiries:
+44 (0)20 7390
Serica Energy plc 0230
Mitch Flegg, CEO / Andy Bell, CFO
+44 (0)20 7418
Peel Hunt (Nomad & Joint Broker) 8900
Richard Crichton / David McKeown
+44 (0)20 7029
Jefferies (Joint Broker) 8000
Tony White / Will Soutar
+44 (0)20 7390
Vigo Consulting (IR/PR) 0230
Patrick d'Ancona / Finlay Thomson serica@vigoconsulting.com
NOTES TO EDITORS
Serica Energy is a British independent oil and gas exploration
and production company with a portfolio of UKCS assets.
On 20 December 2022, Serica announced that it had entered into
an agreement to acquire the entire issued share capital of Tailwind
Energy Investments Ltd from Tailwind Energy Holdings LLP. The
transaction completed on 23 March 2023.
Following the addition of the Tailwind assets to its portfolio,
Serica has a balance of gas and oil production. The Company is
responsible for about 5% of the natural gas produced in the UK, a
key element in the UK's energy transition.
Serica's producing assets are focused around two main hubs: the
Bruce, Keith and Rhum fields in the UK Northern North Sea, which it
operates, and a mix of operated and non-operated fields tied back
to the Triton FPSO. Serica also has operated interests in the
producing Columbus (UK Central North Sea) and Orlando (UK Northern
North Sea) fields and a non-operated interest in the producing
Erskine field in the UK Central North Sea.
Serica's portfolio of assets includes several organic investment
opportunities which are currently being pursued or are under
consideration.
Further information on the Company can be found at
www.serica-energy.com . The Company's shares are traded on the AIM
market of the London Stock Exchange under the ticker SQZ and the
Company is a designated foreign issuer on the TSX. To receive
Company news releases via email, please subscribe via the Company
website.
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