Andy Morrison, CEO, Silvermere Energy interviewed by Drake Lawhead from the Oil Council.
This interview appeared in the April 2012 issue of Drillers and Dealers - the magazine of the Oil Council.
DL: Tell us about Silvermere Energy – what kind of company is it and how would you describe your business model to a potential investor?
AM: Silvermere Energy PLC was established in 2011 with the acquisition of our first near-production asset in the shallow waters of the Gulf of Mexico. The Mustang Island 818-L field in which we participate is a substantial gas and condensate asset which was part-produced in the 1980s. We have a 16.66% working interest in the I-1 well that was re-entered in 2011 and 33.33% in all future wells. Together with the Operator, with whom we work closely, we are engaged in a field rehabilitation project to recover the remaining reserves.
As a Company, we are young and small, but we have big ambitions. We see ourselves focusing on appraisal and production in order to build a company that can sustain itself day-to-day through production revenues and can build value through the development of a significant reserve position. We expect to stay in the US for the time being, and to focus on conventional oil and gas on-shore or in shallow off-shore waters. We will look to take significant minority positions and over time we expect to build our resources to enable us to take on operatorships.
DL: You bought your Mustang Island asset in the Gulf of Mexico last summer. Have you faced challenges raising money to develop it?
AM: We have been fortunate to have a loyal band of shareholders who supported the Company before and during the re-admission last year. They have done so because they can see the value in the asset. With their help we have now developed the asset ready for initial production. We have not been active in capital markets since admission, but we have started to raise awareness amongst investors which we believe is important.
DL: Do you see the capital markets improving at all for small E&P investment companies like yourself?
AM: In short, yes, conditions have improved this year to date compared to last year, but the markets remain somewhat nervous and fragile. I would expect the trend to continue, but it is unlikely to be in a straight line. It helps that the…
