Ithaca Energy's first quarter production rises

Ithaca Energy on Monday posted a 51 per cent increase in new export production to 6,475 barrels of oil equivalent per day (boepd) for the first quarter.

Ithaca Energy on Monday posted a 51 per cent increase in new export production to 6,475 barrels of oil equivalent per day (boepd) for the first quarter.

Production met the upper range of the 2013 guidance of 6,000 to 6,700 boepd in the first three months of the year.

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Cashflow from operations jumped 20% to $34.8m from $28.4m the previous year.

Earnings, excluding unrealised losses on financial instruments of $11m, came to $14.6m, compared to $12m a year earlier.

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The company proved resilient to average realised oil prices falling to $114.32 per barrel of oil from $116.42.

In April, the group completed the acquisition of Valiant Petroleum, which is expected to improve production and revenue.

"The integration of Valiant's activities into Ithaca's existing operations is progressing well," the firm said.

"The company has made major steps since completion of the acquisition to realise the substantial cost synergies that are achievable through removal of operational and administrative overlaps."

The acquisition led to a farm-out transaction with Shell UK for exploration assets.

Ithaca has agreed for Shell to farm-out the company's 40% non-operated interest in UK licence P1792, covering blocks 21/30f and 22/26c in the Central North Sea.

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The farm-out is in exchange for a partial carry of Ithaca's 20% share of the costs of a well on the Beverley prospect, with the licence terms requiring the well to be drilled by early 2015.

Since the announcement of the Valiant merger, the company has reduced its net exploration expenditure commitments by over $45m, leaving about $30m.

Shares rose to 4.99% to 110.50p at 13:41 Monday.

RD

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