Europa Oil & Gas swings into profit in first half

Europa Oil and Gas swung into a pre-tax profit of 0.2m pounds for the six months to the end of January compared to a loss of 5.6m pounds the previous year.

Europa Oil and Gas swung into a pre-tax profit of 0.2m pounds for the six months to the end of January compared to a loss of 5.6m pounds the previous year.

Cash generated from operations rose 25% to £1.0m in the first half from £0.8m the year earlier.

More than 2.0bn barrels of oil were identified in the Irish Atlantic along with four new leads in North East Lincolnshire.

The company recovered 177 barrels of oil equivalent per day (boepd) from UK onshore producing fields which produced £2.2m revenues, down from the prior year's £2.4m.

The 177 boepd was slightly below target due to two workovers on the West Firsby wells in Lincolnshire.

The workovers, which pushed costs higher, were completed in January and the group expects full-year production to be in line with expectations.

"The year to date has illustrated the benefits of having a multi-asset, multi-stage portfolio of licences," said Chief Executive Officer, Hugh Mackay.

"Our UK production has generated increased cash flow over the period that has allowed us to fund in-house technical work on our highly prospective exploration licences in Ireland, the UK and France. As a result, several new prospects have been identified."

He said in the next six months the company expects a renewal of French onshore permits before reactivating a farm-out programme with drilling to commence in 2014.

Europa aims to reach 180 boepd this year, less than last year's 200 boepd, due to a "natural decline in production".

The group also announced it has successfully farmed out its two Irish licences to Kosmos Energy, a US oil and gas exploration and production company.

RD

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