Echo Energy PLC - Operational Update
("Echo" or "the Company")
Argentina Operational Update
Production and Operational Update
Daily production and operations in the field continue with delivery of produced gas to customers continuing without interruption. Production over the period from
As a response to prevailing oil prices and the Company's expectation of achieving higher gas prices moving into the southern hemisphere autumn and winter, the Company and its partners in
To further preserve value, and as a result of progress made in reducing operating costs at Santa Cruz Sur, the Company confirms that of the 25,813 bbls of oil (net to Echo) currently held in storage, it now intends to sell only approximately 13,200 bbls of oil (net to Echo) in the mid-April cargo, holding the remaining 12,613 bbls of oil in field storage tanks with the intention of selling these barrels at a later date.
Cost Reduction and Cash Management
Substantial progress has been made with cost reduction initiatives in the Santa Cruz Sur assets as a response to prevailing commodity prices. At the end of
Additionally, the Company and its partners are pleased to confirm an agreement to extend an existing gas contract, for further two months until
At a corporate level, in accordance with our previously stated aim of preserving cash, defferals and cost reductions are being rigorously pursued. Through a combination of contract renegotiation, cost cutting and expense deferrals which started to come into effect from
Campo Limite Test Update
Due to the ongoing international travel restrictions as a result of the COVID-19 pandemic, key personnel and equipment required to continue testing of the Campo Limite well from outside of
As a result of the decision to temporarily suspend the completion and testing of the Campo Limite well, the Eagle workover rig, owned by Echo and its partners in the Santa Cruz Sur assets, has accordingly been temporarily redeployed to commence a standard programme of well interventions and maintenance. The first well intervention being undertaken, in the Chorillos block, is assessing the production potential of bringing a historical well back online in a small field that currently produces around 20 bopd. The new production potential of the currently non-producing well is now estimated at 41 bopd when brought into production, following a swab test that produced a cumulative 280 bbls of oil over 48-hour period.
As recently announced by the Company, progress in relation to the restructuring of the Company's existing debt is ongoing and the Company looks forward to updating shareholder on progress in due course.
"We have moved quickly to materially reduce our expenditure during this period of low oil prices and uncertainty arising from the COVID-19 pandemic. I am pleased with progress made, in collaboration with Echo's partners, to prioritise higher margin gas sales and focus our workover rig on the potential near term upside of rehabilitating existing wells, whilst deferring non essential activities and maintaining critical operations. Combined with continuing progress in the restructuring of Echo's debt, these efforts provide the Board with significant confidence for the future."
For further information, please contact:
+44 (0) 20 7390 0230
Cenkos Securities (Nominated Adviser)
+44 (0) 20 7397 8900
Shore Capital (Corporate Broker)
+44 (0) 20 7408 4090
The assignment of Echo's 70% non-operated participation in the Santa Cruz Sur licences is subject to the authorisation of the Executive Branch of
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
This information is provided by RNS, the news service of the
Quick facts: Echo Energy PLC
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