Oil and Gas Corporate News

Max Petroleum (LON:MXP) plc (BUY Target Price: 50p) (MXP, 12.3p, ? 4.3%) announced an operational update of its activities in the Blocks A&E Licence area. Drilling has commenced at the SAGW-1 exploration well on the Sagiz West prospect in Block E, which has estimated unrisked mean resource potential of 26 million barrels of oil ("mmbo") in a four-way, Triassic rim structure. Total depth of the well will be approximately 1,600 metres. The Company has executed a drilling contract with PM Lucas for a ZJ-50 rig capable of drilling to 5,000 metres, to drill the ASK-2 exploration well in the Asanketken Field in Block E. The rig is on location and is expected to commence drilling operations before 31 August 2011. The ASK-2 well is designed to test the field's deep Triassic potential, as well as further evaluate potential reservoirs in the shallower Jurassic section found to be productive in the ASK-1 discovery well. The Company expects to commence drilling operations for the NUR-1 pre-salt exploration well in the Emba B Prospect on Block E in October 2011, based on the Company's latest discussions with the drilling contractor, Saipem. The deep rig is currently completing a well for another operator and is expected to begin mobilization to NUR-1 location by the end of the month. The Company has matured two additional prospects into the post-salt inventory, including the Uytas North and Karasai South prospects, both of which are four-way, Triassic rim prospects on Block A. Uytas North has unrisked mean resource potential of 11 mmbo with a 38% geological chance of success ("COS"), while Karasai South has unrisked mean resource potential of 12 mmbo and a 34% COS. The Company also announced the publication of its annual report and accounts for the year ended 31 March 2011. Financial highlights: Revenue of US$55.3 million, up 28% from US$43.3 million in 2010; Total sales volumes of 760,000 bbls, up from 756,000 bbls sold in 2010; Average realised price of US$72.78 per bbl, up 27% from US$57.35 per bbl in 2010; Net cash flow from operating activities of US$14.4 million, compared to US$10.1 million in 2010; Loss of US$18.2 million, compared to a loss of US$253.4 million in 2010. The prior year loss included US$116.2 million of impairment charges and US$101.9 million of non-cash debt restructuring charges; Raised US$85.2 million, before expenses, through…

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