VPC Venture Prod.

 

TIDMVPC 
 
RNS Number : 8749P 
Venture Production plc 
01 April 2009 
 

1 April 2009 
 
 
Venture Production plc 
 
 
 
 
Interim Management Statement 
 
 
 
 
In accordance with the UK Listing Authority's Disclosure and Transparency Rules, 
Venture Production plc ('Venture' or the 'Company'), the Aberdeen-based UK 
independent oil and gas company, is today publishing its Interim Management 
Statement in respect of the period from 1 January 2009 to 1 April 2009. 
 
As at 1 April 2009, Group average production for the year to date has 
been approximately 51,300 (1) barrels of oil equivalent per day ('boepd'), 
around 15% higher than the same period last year.  Key contributors to 
production growth are the Chestnut, Grouse and Stamford fields, which were 
brought into production in the second half of 2008. Following the recent 
start-up of stabilised production from the second Chestnut production well, 
group production has averaged approximately 60,000 boepd, highlighting the 
Company's strong well stock to deliver year on year production growth, as 
previously indicated. 
 
The first quarter of 2009 has been an active period of drilling and field 
development activity. Highlights include: 
 
 
  *  A successful first appraisal well on fault block two of the Cygnus gas field 
  (Venture: 48.75%), which has confirmed the presence of gas in both the primary 
  Leman and secondary Carboniferous reservoir intervals. The well encountered a 
  gas water contact consistent with fault block one thereby confirming pre-drill 
  estimates of gas in place volumes. The quality of the Leman reservoir was as per 
  pre-drill expectations while the Carboniferous reservoir interval substantially 
  exceeded expectations, with an equipment-constrained gross flow rate of 32 
  million standard cubic feet per day (MMscfpd). The likely gross incremental 
  reserves in the Carboniferous section of this fault block alone are expected to 
  be in excess of 100 billion cubic feet (Bcf). 
  *  Good progress has been made drilling a second Cygnus appraisal well, which is 
  testing a further fault block in the north eastern part of the field, which has 
  now reached a final total measured depth of approximately 12,000 feet. Wire line 
  logs have been run and are being evaluated, prior to testing the flow potential 
  of the well. 
  *  The second Chestnut production well (Venture: 69.875%) has been connected to the 
  subsea infrastructure and has increased production from the field to just less 
  than 12,000 boepd net to Venture. 
  *  The successful Carna exploration gas discovery (Venture: 56% unitised interest) 
  which is a commercial gas discovery in its own right, and brings expectations of 
  estimated net gas in place ranging from 95 to 185 Bcf. Additionally the 
  confirmation of productive reservoir sands increases the attractiveness of 
  five potential follow-on prospects in the surrounding Greater Carna Area. These 
  other prospects, whilst as yet undrilled, are expected to contain an additional 
  aggregate net gas in place ranging from 104 Bcf to 390 Bcf. 
  *  Following the outperformance of the Chiswick field to date (Venture: 100%), the 
  second phase of the development of the field has been sanctioned, with two 
  additional wells to be drilled during late 2009 and 2010. Separately the F3-FA 
  development (Venture: estimated 58%) is moving ahead, with the fabrication of 
  the self-installing platform already underway. 
 
 
 
Further drilling news is anticipated in the near future, with the results of the 
test of the second Cygnus appraisal well and the results of the Kew appraisal 
well (Venture: 100%). 
 
 
The combination of the successful drilling results on the first Cygnus appraisal 
well and the Carna exploration discovery, together with further subsurface 
evaluation of the Chiswick field performed for the sanctioning of the next phase 
of the development of the Chiswick field, have already increased Venture's 
proved and probable reserves from 214 million barrels of oil equivalent 
('MMboe') at year end 2008 to around 240 MMboe at the end of the first quarter. 
 
 
Venture's balance sheet remains strong, with a current cash and cash equivalents 
balance of approximately US$275 million and a fully committed GBP365 million 
five year syndicated corporate bank facility, which is undrawn other than 
letters of credit. There has been no significant change to the financial 
position of the Company since the publication of its financial statements in 
respect of the year ended 31 December 2008. 
 
 
In summary, Venture has made an excellent start to 2009 across all areas of its 
business, with strong production performance and a great start to an exciting 
and busy drilling programme, which is aiming to prove up significant reserves 
additions during 2009 and the first half of 2010. Whilst short term gas prices 
have weakened somewhat as we enter the summer gas season, prices for winter 
2009/2010 and beyond remain strong. Venture is continuing to benefit from the 
cash flow generation from its growing production base, underpinned by a 
commodity hedging position that protects a material proportion of the near-term 
production, and with strong financial resources the Board remains confident in 
the outlook for Venture's business. 
 
(1) Provisional data 
 
 
 
END 
 
 
 
 
Contact 
 
 
Mike Wagstaff, Chief Executive 
Rod Begbie, Corporate Development Director 
Jon Murphy, Chief Operating Officer 
Peter Turner, Finance Director 01224 619 000 
 
 
Patrick Handley, Brunswick 0207 404 5959 
 
 
John MacDonald (Scottish Press)     07770 886 912 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 IMSBRGDXSDXGGCB 
 

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