TIDMZPHR
RNS Number : 7266H
Zephyr Energy PLC
08 April 2022
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the UK Market Abuse Regulation.
With the publication of this announcement, this information is now
considered to be in the public domain.
8 April 2022
Zephyr Energy plc
("Zephyr" or the "Company")
Production update from non-operated Williston Basin
portfolio;
Record quarterly production and monthly revenue, and
recent acquisition fully integrated
Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the Rocky Mountain
oil and gas company focused on responsible resource development
from carbon-neutral operations, is pleased to provide an update on
hydrocarbon production from its non-operated asset portfolio in the
Williston Basin, North Dakota, U.S.
Highlights
-- Assets purchased in the recent US$36 million Williston Basin
acquisition (the "Acquisition"), which completed on 17 February
2022, are now fully integrated into Zephyr's portfolio and first
monthly revenues from the Acquisition have been paid to Zephyr from
Whiting Petroleum Corporation, the operator of the assets.
-- At the end of March 2022, Zephyr had 185 wells available for
production, including 7 wells which came online during the first
quarter of the year.
o An additional 16 wells are expected to be brought online and
be available for production over the next six months.
-- Q1 operational production rates from the Company's Williston
Basin portfolio averaged 1,643 barrels of oil equivalent per day
("boepd") net to Zephyr, ahead of previous expectations and
representing a record-breaking production quarter for the
Company.
o 80% of produced volumes were oil
-- In total, Zephyr received circa US$6 million in cash flow
(net to Zephyr) from its non-operated portfolio in March 2022, the
first month in which revenues from the Acquisition were paid in
conjunction with Zephyr's existing portfolio.
Colin Harrington, Chief Executive of Zephyr, said : "It is
almost exactly twelve months since we announced Zephyr's first
non-operated acquisition in the Williston Basin, and I'm absolutely
delighted with the rapid growth and strong cash flows generated by
the five portfolio acquisitions completed to date. Our non-operated
portfolio is now an excellent balance of 185 low-risk, high margin
working-interests ("WIs") alongside strong operators, with another
16 wells expected to come online over the next six months.
"This highly attractive portfolio, assembled prior to the
current increase in the commodity price environment, is now
delivering substantial cashflows which will enable the ongoing
development of our flagship Paradox project - at a time when we are
in the midst of planning a three well drilling programme for the
second half of this year.
"I am thrilled that we received circa US$6 million of cashflow
in March, the first full month of integrated revenues, and I'd like
to thank our management team and the Operator of the wells for
their efforts in completing the Acquisition integration so
quickly."
"It's an exciting time for Zephyr and we look forward to keeping
Shareholders regularly updated on progress in the near term and, in
particular, we look forward to receiving and releasing the results
from our Paradox Basin Competent Persons Report in the coming days.
As always, we will continue to strive to be responsible stewards of
our investors' capital and responsible stewards of the environment
in which we work."
Q1 2022 production update
Q1 2022 operational production rates from the Company's
Williston Basin portfolio averaged 1,643 boepd net to Zephyr,
according to field estimate data.
Further volume and price data is expected to be published
quarterly once detailed production and sales information becomes
available.
Net cash receipts to Zephyr in March 2022 were circa US$6
million. This reflects production revenues accrued to Zephyr from
its existing portfolio as well as from the Acquisition.
The Company has not currently hedged any production to date but
is planning to hedge a substantial portion of its forecast
non-operated production in the near future.
Background
Zephyr began the 2022 calendar year with WIs in 15 non-operated
wells on production. Following completion of the Acquisition, which
completed on 17 February 2022, the Company acquired additional WIs
in 163 producing wells. 7 additional wells came online during the
first quarter of 2022, giving the Company WIs in 185 wells on or
available for production.
Contacts:
Zephyr Energy plc Tel: +44 (0)20 7225
Colin Harrington (CEO) 4590
Chris Eadie (CFO)
Allenby Capital Limited - AIM Nominated Tel: +44 (0)20 3328
Adviser 5656
Jeremy Porter / Liz Kirchner / Vivek
Bhardwaj
Turner Pope Investments - Broker Tel: +44 (0)20 3657
James Pope / Andy Thacker 0050
Flagstaff Strategic and Investor Communications Tel: +44 (0)20 7129 1474
Tim Thompson / Mark Edwards / Fergus
Mellon
Dr Gregor Maxwell, BSc Hons. Geology and Petroleum Geology, PhD,
Technical Adviser to the Board of Zephyr Energy plc, who meets the
criteria of a qualified person under the AIM Note for Mining and
Oil & Gas Companies - June 2009, has reviewed and approved the
technical information contained within this announcement.
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