Financial highlights:
- Loss from operations for the 6 months period is £2,361,721 ((£599,789 for the 6 months period ended 30 June 2022).
- Cash balance, at period end of £1,000,006 (2022 year end: £3,323,161).
- A further £1,188,863 (US$1,500,000) held as restricted cash and £630,575 (2022 year end: 659,504) by way of a loan to FRAM Exploration Trinidad Ltd. for the investment in the Pilot CO2 EOR Project.
- £1,139,950 (before expenses) raised through two placings. Issuing 14,174,056 new ordinary shares at a placing price of £0.055 and 6,322,410 new ordinary shares at a placing price of £0.057.
- 1,000,000, 15,710,972 and 3,401,077 share options exercised at £0.05, £0.08 and £0.10 respectively to raise £1,646,986 with the issue of 20,112,049 new ordinary shares
- 1,875,000 and 160,714 warrants exercised at £0.04 and £0.028 respectively to raise £79,500 with the issue of 2,035,714 new ordinary shares.
- 6,401,077 and 15,710,972 share options issued exercisable at £0.10 and £0.08 respectively.
- Directors' loans advanced through sale of 22,189,580 existing shares at £0.055 to raise £1,220,427; 18,000,000 existing shares at £0.105 to raise £1,890,000; and 15,710,972 and 3,401,077 exercised share options at £0.08 and £0.10 respectively and sold at £0.057, compensated for by a loan of £507,999.
- No debt.
- Issued share capital 426,403,418 (31 December 2022: 383,759,189)
Operational highlights:
- MOU-2 drilled to 1260 metres and suspended for operational reasons with an option to re-enter
- MOU-3 drilled to 1509 metres and completed for rigless testing.
- MOU-3 encountered formation gas shows and shallow higher pressure gas.
- Gas charge from deeper source rocks confirmed via major fault conduits
- MOU-4 drilling at the end of the period under review.
- Rigless testing programme being planned using ECS Sandjet perforating tool.
- Compressed Natural Gas "Proof of Concept" development model established.
- Potential Jurassic upside within 126 km2 structure being evaluated by MOU-4
- Entry into a binding term sheet with Challenger Energy Group Plc for the acquisition of the under-
developed Cory Moruga field subject to regulatory consent for an agreed new work programme.
- Company approached by a potential partner for Corrib South offshore Ireland in the event of the award of a successor authorisation.
Post reporting date:
- On the 11 July 2023 the Company announced that the MOU-4 had been drilled to 1199 metres. The edge of the Jurassic structure had been penetrated and the well had been completed for rigless testing.
- On the 13 July 2023 the Company announced that the NuTech petrophysical interpretation of the MOU-4 well had highlighted a number of intervals for rigless testing.
- On the 1 August 2023 the Company announced that the placing announced on 31 July 2023 had been over-subscribed and had raised gross proceeds of £10 million through the issue of 90,909,090 new ordinary shares at £0.11.
In connection with the placing 8,318,181 broker warrants were issued at an exercise price of £0.11.
- On 10 August 2023 the Company published a Secondary Prospectus (project "Allosaurus") including a Competent Persons Report by Tracs International Limited.
- On the 30 August 2023 the Company announced an operations update including the extension of the Cory Moruga long-stop date from 31 August 2023 to 30 November 2023 to facilitate completion of the Cory Moruga transaction.
Predator Oil & Gas Holdings Plc (PRD), the Jersey-based Oil and Gas Company ("Predator" or "the Company") focussed on near-term, high impact drilling for gas in Morocco is pleased to announce its unaudited interim results for the six-month period ended 30 June 2023.
Executive Chairman's 's Report
Dear Shareholder,
The first six months of 2023 has seen the Company successfully plan and implement a three-well drilling programme onshore Morocco in line with its strategy of focussing on high impact drilling for gas in Morocco.
Results from the MOU-3 well completed for rigless testing in June were particularly encouraging and helped to de-risk the Compressed Natural Gas ("CNG") development case. This is the Company's preferred scenario for supplying the industrial gas market in Morocco to help reduce reliance on carbon intensive Liquified Petroleum Gas imports. Importantly MOU-3 confirmed the interpretation of the results of the MOU-1 well completed in July 2021 and established a new gas basin covering up to 240 km² in the northwest corner of the Guercif Licence. This has created the opportunity to re-assess a previously unexplored part of the Guercif Licence from the perspective of developing new gas prospects at several different geological levels.
Higher gas prices are achievable in the private sector and CNG offers a simpler solution to deliver gas to dispersed industrial users compared to investing in pipeline infrastructure, which requires more fixed capital investment; takes longer to construct due to requirements for environmental approvals and land permitting; and necessitates initially deploying more risk capital for drilling to underpin a minimum medium term gas production profile to fix the required amount of pipeline capacity. By contrast CNG is a flexible and scalable development where additional capital expenditure can be funded organically and proportionally out of productions revenues given Morocco's very favourable fiscal regime.
Gas-to-power developments are longer term and will likely attract a lower gas sales price as the State is the only permitted buyer of the gas for electricity generation.
The Company's drilling programme is being targeted at defining the minimal, relatively modest, flow rates required for a scalable CNG development to create a revenue-generating business, whilst maintaining the impetus to discover larger volumes of gas for which future markets might include gas-to-power and export to Europe via the Maghreb gas pipeline, which runs through the area drilled to date by the Company.
2023 thus far continues to be dominated by the ramifications of the Ukraine-Russia crisis which has led to an Energy Crisis. Inflation has increased to levels that are beginning to impact the global economy. The Company is pleased to report that despite sharply rising costs it has re-structured its Moroccan operations, by availing of management's extensive historical and present relationships with suppliers of well services in many different jurisdictions, to maintain drilling costs in line with actual 2021 costs.
Identification and development of CO2 EOR projects in Trinidad remains a key objective of the Company. CO2 EOR is compatible with promoting a stable period of Energy Transition for those countries where the economies are heavily reliant on revenues and taxes from the oil and gas sector. It's a practical short-term measure that contributes positively to assisting to achieve the longer term solution of greener energy supply, storage for anthropogenic CO2 and promoting economic stability.
As with all projects that involve an element of seeking to stabilise and ultimately reduce CO2 emissions the project economics have to demonstrate a commercial return to investors within a relatively short timescale. Larger projects would require State funding to underpin the investment model in order to generate acceptable returns for investors. This is how market dynamics work in practice to contribute towards maintaining healthy economies.
In Ireland the Company's shorter-term emphasis has shifted so far in 2023 to attempting to secure a successor authorisation for Corrib South. Energy security, gas storage and preserving EU gas infrastructure to maintain diversification of entry points into the European gas grid independent of Russian gas supplies is becoming of increasing strategic significance. Maintaining the longevity of the Corrib gas field infrastructure during the Energy Transition for blended gas and hydrogen storage and possible LNG imports contributes to this strategic objective.
The Company is working with a potential strategic partner in the event a successor authorisation for Corrib South is awarded.
The Mag Mell FSRU project and the application for a successor authorisation for Ram Head focussed on the development of a gas storage facility remain on the table for consideration by the Irish regulatory authorities but are not expected to advance further during 2023.
The Energy Transition and "Security of Energy Supply" have become critical issues in 2023 for the well-being of the global economy. The informed narrative in relation to the "Energy Crisis" and the dawning of the practical realisation that net zero CO2 emissions cannot be achieved without a period of transition has resulted in an increased willingness to invest in the gas and, to a lesser extent, oil sectors during the period under review.
The Company has always maintained focus on and operatorship of its three core areas of Morocco, Trinidad and Ireland. It has not diluted project equity in that time on the basis that any future monetisation of assets has a greater chance of attracting entities of substance if the opportunity is material to them.
The outlook for the remainder of 2023 will see the rigless testing programme in Morocco initiated and completed and, subject to results, the CNG development plan being progressed targeting "First Gas" in 2024.
Additional high impact drilling opportunities in Morocco will be evaluated and potentially progressed in 2023 and 2024.
Subject to completion of the acquisition of TRex Holdings Trinidad Limited and regulatory approvals, a high impact appraisal well in the under-developed Cory Moruga licence may be scheduled for 2024.
The Corrib South successor authorisation will be progressed as far as possible with the potential for a strategic partner to become involved in any future licence award.
Market dynamics are cyclical and currently the appetite is for near-term, value creating, drilling success. The Company's portfolio is aligned with investor sentiment for near-term activity with the prospects of material results in a success case.
