Trinity Exploration - Q1 2023 Operational Update
27/04/2023 07:00
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RNS Number : 6135X Trinity Exploration & Production 27 April 2023
This announcement contains inside information as stipulated under the UK
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27 April 2023
Trinity Exploration & Production plc
("Trinity" or "the Group" or "the Company")
Q1 2023 Operational Update
Trinity Exploration & Production plc (AIM: TRIN), the independent E&P
company focused on Trinidad and Tobago, provides an update on operations for
the three-month period ended 31 March 2023 ("Q1 2023" or "the Period").
The information contained herein has not been audited and may be subject to
further review and amendment.
Jeremy Bridglalsingh, Chief Executive Officer of Trinity, commented:
"Trinity is at an inflection point as we prepare to drill the Jacobin well,
testing the first of our nine Hummingbird deeper prospects. The rig has
mobilised and the well will spud in the coming days. The well is designed to
test the extensive deeper onshore play and collect data to calibrate and
define future activity across Trinity's existing onshore acreage and the
Buenos Ayres block, should the Company be successful in the ongoing licence
round.
The ABM-151 well was successfully returned to production in March and, since
this time, has performed consistently above expectations. The well is
currently producing at a managed stabilised rate of around 140 bopd, whilst
producing encouraging well performance data.
As reported, we suffered from two setbacks recently: the cyber incident in
December and then, in April, a generator fire on the Trintes Bravo platform.
I'm pleased to say that we avoided a lengthy disruption from either event and
the team responded in a calm and professional manner. Trintes returned to
production the day following the fire and Bravo itself within eight days. We
are grateful for the help of the Ministry of Energy and Energy Industries,
with whom our excellent working relationship proved invaluable, and I am also
thankful for the team's rapid and level-headed response. We see this focus
and commitment in other operational delivery such as the successful
performance of ABM-151 and look forward to updating shareholders on our
further progress at a very busy and exciting time for Trinity."
Q1 2023 Operational Highlights
· The Company maintained solid production performance over the quarter
with Q1 2023 sales volumes averaging 2,899 bopd (Q4 2022: 2,961 bopd; Q1
2022: 2,929 bopd). This sales performance, which is broadly in line with
the prior period, comes as a result of ongoing well optimisation, drilling,
workovers and recompletion activities.
· During Q1 2023:
- 2 recompletions ("RCPs") (Q4 2022: 1; Q1 2022: 5) were completed.
- 39 workovers (Q4 2022: 27; Q1 2022: 24) were completed.
- swabbing operations continued across onshore and West Coast
assets.
· The ABM-151 well in the Brighton Marine block, offshore the West
Coast of Trinidad, was returned to production on 21 March 2023 following an
extensive refurbishment of surface facilities and the installation of remote
surveillance technology. Between restart and the end of the Period the well
flowed at an average rate of 175 bopd. The well is currently producing at a
managed rate of 140 bopd and Trinity continues to monitor the well closely.
Q4 2022 Financial Highlights
· Average realisation of US$ 67.9/bbl for Q1 2023 (Q4
2022: US$ 75.4/bbl, Q1 2022: US$ 83.1/bbl) reflects lower prevailing oil
prices in the Period.
· EBITDA, pre-hedging(1), in Q1 2023 of US$ 5.3 million (unaudited)
(Q4 2022 US$ 7.9 million (unaudited); Q1 2022 US$ 7.9 million).
· Operating break-even(2), pre-hedging(1), Q1 2023 of US$ 35.4/bbl (Q4
2022 US$ 31.4/bbl; Q1 2022 US$ 31.1/bbl).
(1) The Company has no hedging in place in 2023.
(2) Operating break-even is the realised price/bbl where the
adjusted EBITDA/bbl for the Group is equal to zero.
· Cash balance of US$ 11.4 million (unaudited) as at 31 March 2023
versus US$ 12.1 million (unaudited) as at 31 December 2022 and
US$ 17.5 million as at 31 March 2022.
· The Group had drawn borrowings (overdraft) of US$ 2.3 million as at
31 March 2023 (US$ 2.7 million as at 31 December 2022 and US$ 2.7 million
as at 31 March 2022).
· The Company continued to repurchase its Ordinary Shares in accordance
with the second buyback programme announced on 24 October 2022 and, during the
Period, repurchased an additional 312,000 shares (0.8% of the Company's shares
in issue).
The second buyback programme concluded on 26 April 2023 with a further 48,000
shares repurchased during April 2023 bringing the total number of shares held
in treasury at 26 April 2023 to 1,432,000 (3.6 % of the Company's shares in
issue).
The Board will consider a further share buyback programme.
Outlook
Jacobin Update
Preparation of the site for the upcoming Jacobin well to test the deep Miocene
play fairway in Licence PS-4 is complete. Well Services' Rig 60 mobilisation
is underway currently with the first elements of the rig arriving on site and
are being assembled. The well is expected to spud in the coming days.
2022 Onshore and Nearshore Competitive Bid Round
On 9 January 2023, Trinity submitted a bid for the Buenos Ayres block in the
2022 Onshore and Nearshore Competitive Bid Round conducted by the Government
of Trinidad and Tobago Ministry of Energy and Energy Industries.
Buenos Ayres is located immediately to the west of Trinity's existing Palo
Seco area interests comprising Blocks WD-5/6, WD-2 and PS-4 and, at its
closest, is only around 500 metres from the Company's existing sub-licences.
If awarded, Trinity would seek to take advantage of its unique understanding
of the stratigraphy in this area onshore Trinidad, where there are strong
analogues to the Company's existing acreage, and quickly progress from the
drilling phase to production.
Award of licences from the Bid Round is now anticipated in May.
Cyber Incident
Following the sophisticated cyber incident in December 2022, Trinity's IT team
and its external advisers have successfully returned its administrative
systems to full capacity incorporating learnings from the incident and
embedding more resilient IT infrastructure, cyber security systems and
procedures.
This work to high-grade IT and associated security systems has delayed the
normal year-end financial close process. However, the external financial
audit is underway and the Company still expects to issue its audited 2022
financial statements before 30 June 2023, in line with its legal and
regulatory requirements.
Trintes Field Incident
On the evening of 10 April 2023, a fire occurred in one of the two generators
on the Trintes Bravo platform. Production across the field was halted and
the fire was contained. Production restarted from Alpha and Delta platforms
on 11 April 2023.
Four operators, all Trinity staff, were on Bravo at the time of the incident
and, having suffered some burns and from smoke inhalation, all are now
recovering well and expect to resume work imminently.
Following approval from the Ministry of Energy and Energy Industries, received
on 17 April 2023, the Company successfully restored oil production from all
previously producing wells on the Bravo platform on 18 April 2023.
Production from the field is in-line with pre-incident levels at approximately
1,010 bopd.
Enquiries:
Trinity Exploration & Production plc Via Vigo Consulting (mailto:trinity@vigoconsulting.com)
Nick Clayton, Non- Executive Chairman
Jeremy Bridglalsingh, Chief Executive Officer
Julian Kennedy, Chief Financial Officer
SPARK Advisory Partners Limited +44 (0)20 3368 3550
(Nominated Adviser and Financial Adviser)
Mark Brady
James Keeshan
Cenkos Securities PLC (Broker) +44 (0)20 7397 8900
Leif Powis +44 (0)131 220 6939
Neil McDonald
Vigo Consulting Limited trinity@vigoconsulting.com
Finlay Thomson / Patrick d'Ancona +44 (0)20 7390 0230
About Trinity (www.trinityexploration.com (http://www.trinityexploration.com)
)
Trinity is an independent oil production company focused solely on Trinidad
and Tobago. Trinity operates producing and development assets both onshore
and offshore, in the shallow water West and East Coasts of Trinidad. Trinity's
portfolio includes current production, significant near-term production growth
opportunities from low-risk developments and multiple exploration prospects
with the potential to deliver meaningful reserves/resources growth. The
Company operates all of its ten licences and, across all of the Group's
assets, management's estimate of the Group's 2P reserves as at the end of 2021
was 19.73 mmbbls. Group 2C contingent resources are estimated to be 47.22
mmbbls. The Group's overall 2P plus 2C volumes are therefore 66.95 mmbbls.
Trinity is quoted on AIM, a market operated and regulated by the London Stock
Exchange Plc, under the ticker TRIN.
Competent Person's Statement
All reserves and resources related information contained in this announcement
has been reviewed and approved by Dr. Ryan Ramsook, Trinity's Executive
Manager, Exploration. Dr. Ramsook is also a Senior Lecturer at the University
of the West Indies and Fellow of the Geological Society (FGS) of London. He is
a Geologist by background with 18+ years' experience.
Disclaimer
This document contains certain forward-looking statements that are subject to
the usual risk factors and uncertainties associated with the oil exploration
and production business. Whilst the Group believes the expectation reflected
herein to be reasonable in light of the information available to it at this
time, the actual outcome may be materially different owing to macroeconomic
factors either beyond the Group's control or otherwise within the Group's
control.
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