OilVoice - Valiant Petroleum Announces 2010 Interim Results

Valiant Petroleum Announces 2010 Interim Results

Wednesday, September 08, 2010

Valiant Petroleum plc announces its interim financial results for the period to 30 June 2010. All amounts are quoted in US dollars unless otherwise noted.

Financial Highlights
• Revenue of $64.5 million and operating cash flow of $44.8 million, average price of $79.4/bbl
• Cash balances of $67.5 million and drawn debt of $169.3 million; mezzanine debt restructured
• Profit before tax for H1 2010 increased to $23.1 million (H1 2009: $1.2 million)
• Bank debt refinancing process launched with target close during Q4 2010

Operational Highlights
• Completion of Don Fields Phase I, first half average net production of 6,033 barrels of oil per day ('bopd')
• Don Fields Phase II well advanced with development drilling complete ahead of schedule, delivering gross stabilised flow rates of 17,000 bopd from Don Southwest 'Horst' well
• Successful discovery at Tybalt with internally estimated stock tank oil initially in-place ('STOIIP') range of 30-100 million barrels of oil ('mmbbls')
• Successful farm-out to Apache North Sea Limited of the Viola prospect in March, paying 75% of well costs for a 50% equity interest; subsequent spud of Viola North exploration well on 31 August

Outlook
• Production guidance for 2010 reiterated at between 6,500 and 7,500 bopd (average net)
• Don Fields Phase II ahead of schedule, hook-up of third West Don production well anticipated Q3 and Don Southwest 'H' Panel appraisal well in Q4
• Don Fields Phase III planning underway for 2011 including further development, appraisal and exploration
• Viola North exploration well result expected during Q4, potential side-track on success Tybalt subsurface analysis ongoing to identify optimal drilling location(s) for appraisal programme in 2011
• Expanding UKCS exploration portfolio - 26th UK Offshore Licensing Round results anticipated in Q4 2010

Peter Buchanan, CEO, commented:
'Completion of the first phase of the Don development during the period has been a major milestone for Valiant and the financial performance in the first half of the year reflects this increase in production from the Don Fields. Valiant is also delivering on its 2010 exploration campaign with a discovery at Tybalt and the recent spud of the Viola North exploration well. Valiant will build on this production foundation by pushing forward further development phases on the Don Fields as well as progressing its other assets through the development cycle.

Valiant remains focused on creating value through the drill bit and planning has begun on our 2011 exploration and appraisal campaign which will include the appraisal programme on Tybalt. Valiant will continue to seek exploration opportunities through both the UK 26th Offshore Licensing Round and via potential farm-in or acquisition of other exploration interests.'

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