Trading and Operations Update July 2024

Pharos Energy PLC

18 July 2024

 

Pharos Energy plc

("Pharos" or the "Company" or, together with its subsidiaries, the "Group")

Trading and Operations Update July 2024

Pharos Energy plc, an independent energy company, issues the following Trading and Operations Update in advance of the Company's Interim Results on 18 September 2024. The information contained herein is not audited and may be subject to further review and amendment.

Katherine Roe, Chief Executive Officer, commented:

"We are delighted to report a solid first half, both operationally and financially. Production remains within previously set guidance underpinning our strong net cash position and our commitment to sustainable shareholder returns through the Company's dividend policy and share buyback programme.

"The positive macro environment in Egypt has seen a significant improvement in our receivables position with c. $19 million received to date, substantially reducing our receivables balance. Further discussions continue regarding outstanding payments. The recent ratification of five petroleum agreements for onshore and offshore acreage further demonstrates the new Government's commitment to our sector.

"In parallel, we remain focused on near-term drilling and finalisation of the licence extensions for TGT and CNV in Vietnam to enable us to prioritise future investment to deliver additional volumes. We also continue to progress rig and farm-out discussions for Blocks 125 and 126, our significant exploration prospects."   

Operational Highlights

·      Group working interest 1H production was 5,851 boepd net. Group working interest 2024 production guidance of 5,200 - 6,500 boepd net remains unchanged:

o  Vietnam 1H production 4,456 boepd. Vietnam 2024 production guidance 3,900 - 5,000 boepd net

o  Egypt 1H production 1,395 bopd. Egypt 2024 production guidance 1,300 - 1,500 bopd net

·      In Vietnam:

o  TGT Revised Field Development Plan (RFDP) was approved by the Ministry of Industry and Trade (MOIT) on 9 January, enabling the two-well drilling programme to commence in 3Q

o  CNV RFDP agreed by all Partners and awaiting formal approval

o  Positive progress towards obtaining TGT and CNV licence extensions  

o  Discussions continue with several interested parties in preparation for the drilling programme on Block 125

·      In Egypt:

o  Preparation underway to drill an exploration commitment well on El Fayum in 3Q

o  Processing and interpretation of c.130km² of 3D seismic data on NBS underway and expected to complete in 4Q

o  Multi-well development drilling programme in the NBS SW field planned to commence during 2H

o  Discussions on Egypt consolidation proposal held between Pharos, our partner IPR, and EGPC

Financial Highlights

·      Group 1H revenue of $65m

·      Cash balances at 30 June of c.$31m (31 Dec 2023: $32.6m)

·      Debt as at 30 June of c.$13m (31 Dec 2023: $39.2m)

·      Net cash position as at 30 June of c.$18m (31 Dec 2023: net debt $6.6m)

·      Egypt receivable position at 30 June of $31.3m (31 Dec 2023: $37.4m), having received $14.8m in 1H 2024 with an additional $4m received from EGPC on 1 July

·      Forecast cash capex for the Group for full year remains unchanged at $32m ($27m after Egyptian carry by IPR), with costs in Egypt mainly settled in EGP

Corporate Highlights

·      Recent changes to the Board and senior management:

o  Appointment of Katherine Roe as the new Chief Executive Officer, effective 1 July 2024, and as member of the Board and the ESG Committee

o  Appointment of Mohamed Sayed as the new Chief Operating Officer, effective 1 July 2024

·      Continuation of current phase of share buyback programme

·      Approval by shareholders at the 2024 AGM of a final dividend in respect of the year ended 31 December 2023 of 0.77 pence per share, amounting to $4.1m and to be paid on 19 July 2024. Including the payment of the interim dividend of 0.33 pence per share on 24 January 2024, the full year 2023 dividend was 1.10 pence per share, amounting to $5.9m in total

·      Appointment of Ernst & Young LLP to succeed Deloitte LLP as external auditor to the Company with effect from the financial year commencing 1 January 2024, following approval by shareholders at the 2024 AGM

Enquiries

Pharos Energy plc                                                                                                                                   Tel: [phone]

Katherine Roe, Chief Executive Officer 

Sue Rivett, Chief Financial Officer

Mohamed Sayed, Chief Operating Officer 

Camarco                                                                                                                                                 Tel: [phone]

Billy Clegg | Andrew Turner | Violet Wilson | Rebecca Waterworth | Kirsty Duff

Notes to editors

Pharos Energy plc is an independent energy company with a focus on sustainable growth and returns to stakeholders, which is listed on the London Stock Exchange. Pharos has production, development and/or exploration interests in Egypt and Vietnam. In Egypt, Pharos holds a 45% working interest share in the El Fayum Concession in the Western Desert, with IPR Lake Qarun, part of the international integrated energy business IPR Energy Group, holding the remaining 55% working interest. The El Fayum Concession produces oil from 10 fields and is located 80 km southwest of Cairo. It is operated by Petrosilah, a 50/50 joint stock company between the contractor parties (being IPR Lake Qarun and Pharos) and the Egyptian General Petroleum Corporation (EGPC). Pharos also holds a 45% working interest share in the North Beni Suef (NBS) Concession in Egypt, which is located immediately south of the El Fayum Concession. The first development lease on the NBS Concession was awarded in September 2023 and production started in December 2023. IPR Lake Qarun operates and holds the remaining 55% working interest in the NBS Concession. In Vietnam, Pharos has a 30.5% working interest in Block 16-1 which contains 97% of the Te Giac Trang (TGT) field and is operated by the Hoang Long Joint Operating Company. Pharos' unitised interest in the TGT field is 29.7%. Pharos also has a 25% working interest in the Ca Ngu Vang (CNV) field located in Block 9-2, which is operated by the Hoan Vu Joint Operating Company. Blocks 16-1 and 9-2 are located in the shallow water Cuu Long Basin, offshore southern Vietnam. Pharos also holds a 70% interest in, and is designated operator of, Blocks 125 & 126, located in the moderate to deep water Phu Khanh Basin, north east of the Cuu Long Basin, offshore central Vietnam.

 

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