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Friday, May 29, 2020

EnQuest confident of meeting targets

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EnQuest said today it had “responded well” and that its operations were “materially unaffected” by the Covid-19 pandemic.

The published operations update showed group production was just under 66,000 barrels of oil equivalent (boe) per day in the first four months of the year, above full-year guidance of 57-63,000 boe per day.

Output from the UK North Sea Kraken field was 38,000 boe per day, up 36% year-on-year, thanks partly to improved FPSO performance.

Net debt was reduced to £1.12 billion at the end of April, from £1.16bn at the end of 2019, while cash and available facilities total £237m.

Production in the four months to end April averaged 21,106 Boepd, 39% lower than the same period in 2019.

The decrease was put down to the decision not to restart production at the Heather/Broom and Thistle/Deveron fields, which contributed c.9,000 Boepd in the same period in 2019.

Amjad Bseisu, EnQuest chief executive, said:  “EnQuest has responded well to the challenges of COVID-19 and the downturn in oil prices.

“Our continued focus on operational excellence has ensured our operations remain unaffected by the ongoing COVID-19 pandemic.

“Performance at Kraken and Scolty/Crathes has been ahead of expectations, while production at Magnus and PM8/Seligi has also been good, with the two new wells drilled on Magnus coming onstream in March.

“We also took decisive, early action to reduce costs and the implementation of our cost reduction programme is progressing well.

“With the strong performance in the year to date and continued focus on delivering our cost programme, we expect that for the remainder of the year we need to realise an average oil price of around $25/Boe to achieve free cash flow break even, and remain confident in meeting our targets.”

Last month, London-listed EnQuest said it would reduce operating expenditure by £155 million to £270m and lower capex by almost 50% to £97m in response to the slump in crude prices.

It also confirmed it would be shedding around 530 jobs.


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