Our previous look at the investment case behind oil and gas play President Energy (PPC:AIM) was based on planned activity in Argentina. Now the story takes another turn with a new deal in the US.
Its shares rise 5.5% to 7.44p after announcing the acquisition of incremental production of 150 barrels of oil equivalent per day (boepd) in Louisiana for a cash consideration of $2.25m and a further $0.4m based on future production.
KEEPING THE LIGHTS ON
This adds to the existing Louisiana output which helps cover general and administration costs, meaning the company’s other funds can go directly into creating value via the drill-bit rather than paying salaries and keeping the lights on.
President is targeting production of 1,200 boepd by the end of September.
Factoring in this acquired production, President has already hit 1,100 boepd and we believe there is a good chance of exceeding this guidance as its Argentinian work programme ramps up.
