Ophir Energy reports large increase in net contingent resources

published 5 March 2013

Shares in Ophir Energy made strong gains on Tuesday, as the reported a 100 per cent operational success rate for 2012.

The company increased net contingent resources by 896m barrels of oil equivalent (boe), from 210m boe to 1.106m boe.

Despite these successes, the loss from continuing operations before taxation doubled to $40.9m (2011: $19.1m) on revenue of $1.0m, down from $14.7m in 2011.

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General and administration expenses rose to $36.4m from $16.2m the previous year, while exploration expenses dropped to $4.5m from $15.7m in 2011.

During the period, ten seismic programmes were acquired and two new country entries were completed, into Kenya and Ghana.

Chief Executive Officer Nick Cooper said: "2012 has been a successful year for Ophir Energy. The group achieved a 100% success rate with the drill bit across six exploration and two appraisal wells, reaffirming Ophir's reputation as a leading explorer in Africa.

"The group's strategy is to focus on significant, operated equity positions in plays with substantial running room, to fund extensive 3D seismic acquisition, and to partner with leading oil companies to deliver high impact, deepwater drilling programmes.

"We have made good progress over the past year. Ophir is now the sixth largest net acreage holder offshore Africa and has acquired ten 3D seismic programmes in 2012. The Group's 2012 drilling discovered around 896m barrels of oil equivalent (boe) of net contingent resources during the year and the group's total discovered resources increased 377% in 2012 to an estimate 1.106bn boe at year end.

"2013 has the potential to be another exciting year for Ophir, with a 10+ well drilling programme that has the potential to transform the portfolio again."

The group also announced the successful placing of 19.85m shares at 460p each, raising in the region of £91.3m, equal to 5.0% of the current issued share capital.

The proceeds will be used to add value across the company's portfolio through a combination of a high impact pan-African drilling programme, maintaining the pace of commercialisation of the group's gas assets in Tanzania and making strategic additions to its portfolio.

The share price rose 5.28% to 486.10p by 09:40 Tuesday.