Bahamas Petroleum posts a total operating loss of $2.159 million for the six months to the end of June, down 8% on last time and 11% on the 2015 full year result on an annualised basis.
The company says that on a true cash basis, considerably greater savings have been achieved as a result of measures implemented over the last few years and, in particular, over the 6-month period to June 2016.
In particular, as previously announced, the board elected to increase its fee deferral from 1 April 2016 to 50% of contracted entitlements (up from the 20% deferral implemented in the fourth quarter of 2014).
Additionally, chief executive Simon Potter took the decision to increase the deferral of his contracted salary to 90%, also effective 1 April 2016, and similar deferrals were agreed to by other executive employees of the company. These deferrals are only repayable once a successful farm-out or other financing arrangement has been concluded such that the Company's forward programme is secured.
- Final passage of the new Petroleum Act by the Bahamian legislature, with the new law formally enacted as at 31 March 2016
- Gazettal and implementation of the attendant Petroleum Regulations took place during the summer
- Process of updating the legal and regulatory environment of The Bahamas in anticipation of future exploration activities completed
- Anticipated drilling rig rates now at a quarter of where they were in 2012
- Independent analysis by Wood Mackenzie shows that the anticipated well ranks in the top 10 "Drilling and Future Wells by Prospect Size" in estimate of pre-drill volumes
- Meaningful farm-out discussions have continued with a number of suitably qualified potential partners
- Cost cutting has continued apace - Board elected to increase its fee deferral from 1 April 2016 to 50% of contracted entitlements, 90% for CEO
- Company has saved a total of $678k in cash fees / salary outgoings since the deferrals commenced in 4Q 2014
- As at 30 June 2016 the Company had a total cash balance of approx. $2.5m
Potter said: "Significant 'above ground' progress has been made this year with the passage of the Petroleum Act and implementation of the associated Petroleum Regulations. This has further facilitated farm-out discussion activity and we are in meaningful discussions with a number of parties. At the same time we have significantly cut costs.
"The company's core assets are compelling as they offer multi-billion barrel potential, competitive metrics, robust profitability at today's oil price, and advantaged location adjacent to the largest offshore operating environment and energy market in the world. Consequently, we remain confident that we will conclude a partnership agreement within the required timeframes."
At 8:09am: (LON:BPC) Bahamas Petroleum Company PLC share price was +0.11p at 1.41p