REG-Genel Energy PLC Genel Energy PLC: Trading and operations update

Genel EnergyAnnouncement

12/05/2022 07:15

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   Genel Energy PLC (GENL)
   Genel Energy PLC: Trading and operations update

   12-May-2022 / 07:00 GMT/BST
   Dissemination of a Regulatory Announcement that contains inside
   information according to REGULATION (EU) No 596/2014 (MAR), transmitted by
   EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   12 May 2022

    

                                Genel Energy plc

                                        

                         Trading and operations update

                                        

   Genel Energy plc ('Genel' or  'the Company') issues the following  trading
   and operations  update  ahead  of the  Company's  Annual  General  Meeting
   ('AGM'), which is being held today.

    

   Bill Higgs, Chief Executive of Genel, said:

   “Our  robust  financial  position  continues  to  strengthen,   supporting
   investment in our organic portfolio  as well as our progressive  dividend.
   Despite the result of Sarta-5, the well delivered useful data that we will
   incorporate together with the results of our next well, Sarta-6, into  our
   forward plans for  the field.  As we look  to add  production and  further
   bolster our progressive  dividend and  create value  for stakeholders,  we
   continue to review both organic and inorganic opportunities.”

    

   FINANCIAL PERFORMANCE

     • $95 million  cash proceeds  received  in Q1  2022 from  the  Kurdistan
       Regional Government
     • Free cash flow of $43 million in Q1 2022

          ◦ Margin of $30/bbl in Q1 2022 (2021: $24/bbl), with Brent
            averaging $102/bbl (2021: $71/bbl)
          ◦ Capital expenditure of $35 million in Q1 2022, of which $19
            million was spent at Tawke, and $12 million at Sarta

          ◦ Of the $35 million total invoiced for December 2021 oil sales,
            $17 million was received in Q1 2022, with $18 million of invoices
            being received after period end

     • Cash of $356  million at 31  March 2022 ($314  million at 31  December
       2021)
     • Net cash of $86 million at 31  March 2022 ($44 million at 31  December
       2021)

    

   PRODUCTION

     • Net production of 30,520 bopd in Q1 2022, in line with guidance
     • Zero lost time injuries or Tier 1 losses of primary containment in  Q1
       2022
     • Tawke PSC (25% working interest)

          ◦ Gross production of 106,470 bopd in Q1 2022, 26,620 net to Genel,
            of which Peshkabir contributed 64,500 bopd and Tawke 41,970 bopd
          ◦ A high level of activity was maintained at Tawke in Q1 2022, with
            five wells spud across the Tawke and Peshkabir fields, with a
            fourth drilling rig set to be added
          ◦ The Peshkabir-Tawke gas project has captured 12 billion cubic
            feet of otherwise flared gas, equivalent to 766,000 tonnes of CO2
            equivalent, since start up in mid-2020 through the first quarter
            of 2022. Phase 2 is a $25 million expansion underway at the Tawke
            field to capture breakthrough gas, set to start in the fourth
            quarter of 2022. The operator, DNO, is also debottlenecking the
            Peshkabir gas plant originally designed for 50,000 bopd to handle
            larger volumes of associated gas from higher field production,
            which is now averaging 65,000 bopd

     • Sarta (30% working interest and operator)

          ◦ Gross production of 5,590 bopd in Q1, 1,670 bopd net to Genel
          ◦ Sarta-1D was brought onto production on 8 March from the Mus and
            Upper Adaiyah reservoirs, the same zone on production at Sarta-2.
            On well test at Sarta-1D the Lower Adaiyah produced at low oil
            rates with a high water cut while oil was discovered in the
            Butmah, achieving flow rates of over 1500 bopd, but again with a
            high water cut. Since coming onstream, production from the Mus
            and Upper Adaiyah reservoirs at Sarta-1D has been choked back in
            order to manage pressure decline between the two adjacent take
            points of Sarta-1D and Sarta-2, and water cut at Sarta-1D
          ◦ Total field production has averaged c.6,150 bopd in May, as we
            continue to work through a programme to optimise production from
            the three producing wells
          ◦ Sarta-5 testing completed on 9 May and the well is now suspended.
            As previously stated, the presence of oil associated with both
            the primary and secondary Jurassic reservoir intervals, 12 km
            southeast of the Sarta pilot EPF, will be subject to further
            investigation and integration into the joint venture’s
            understanding of the Sarta field and future planning
          ◦ Test results from the Sarta-6 well, c.6 km to the west of the
            pilot EPF, are expected in Q3

     • Taq Taq PSC (44% working interest and joint operator)

          ◦ Gross production of 5,070 bopd, 2,230 bopd net to Genel
          ◦ As the margins at Taq Taq have increased, planning is underway
            for the resumption of drilling, with a well expected to spud
            around the end of 2022

    

   PRE-PRODUCTION

     • Qara Dagh (40% working interest and operator)

          ◦ The evaluation of the QD-2 well and its results is underway, with
            a decision on licence next steps to be taken later this year

     • Somaliland (51% working interest and operator)

          ◦ Following the successful farm-out in December 2021, preparation
            is under way for the drilling of a well on the highly prospective
            SL10B13 block around the end of 2023

     • Morocco (75% working interest and operator)

          ◦ Petroleum Agreement and Association Contract expected to be
            signed with ONHYM in Q2 2022, with a farm-out programme scheduled
            to begin later this year

    

   ESG

     • Genel’s 2021 Sustainability  Report has been  issued today,  detailing
       our environmental performance and the  positive impact that we  strive
       to have  on  the communities  in  which we  operate.  2021  highlights
       include:

          ◦ 11 social investment and community projects funded and delivered
            in 2021
          ◦ Zero waste to landfill from operations at Sarta, with 92%
            recycled
          ◦ Renewable energy feasibility study progressing at Sarta

     • Genel is marking twenty years of operating in the KRI with its Genel20
       programme, increasing the scope of our social activities, including  a
       new education initiative set to be  launched next week at an event  in
       Dohuk

    

   2022 OUTLOOK AND GUIDANCE

     • Guidance reiterated, with production for 2022 at around the same level
       as the 2021 average
     • The Board is recommending the approval of a final dividend of 12¢  per
       share (2021: 10¢ per  share) at today’s AGM,  a distribution of  $33.5
       million, as we  continue to  fulfil our  aim of  paying a  progressive
       dividend

    

                                     -ends-

    

   For further information, please contact:

    

   Genel Energy
                                         +44 20 7659 5100
   Andrew Benbow, Head of Communications
                                          
   Vigo Consulting
                                         +44 20 7390 0230
   Patrick d’Ancona 

    

   This announcement includes inside information.

    

   Notes to editors:

   Genel Energy is  a socially responsible  oil producer listed  on the  main
   market   of    the    London    Stock   Exchange    (LSE:    GENL,    LEI:
   549300IVCJDWC3LR8F94). The  Company is  one of  the largest  London-listed
   independent hydrocarbon producers, with an asset portfolio that  positions
   us well for a future of fewer and better natural resources projects. Genel
   has low-cost and low-carbon production from the Sarta, Taq Taq, and  Tawke
   licences in the Kurdistan Region  of Iraq, providing financial  resilience
   that allows  investment  in growth  and  the  payment of  a  material  and
   progressive dividend.  Genel  also  continues  to  pursue  further  growth
   opportunities.    For    further    information,    please    refer     to
    1 www.genelenergy.com

    

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   ISIN:          JE00B55Q3P39, NO0010894330
   Category Code: MSCH
   TIDM:          GENL
   LEI Code:      549300IVCJDWC3LR8F94
   Sequence No.:  161114
   EQS News ID:   1350333


    
   End of Announcement EQS News Service

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