President Petroleum on the hunt for strategic acquisitions

Junior oil and gas exploration and production company, President Petroleum (AIM: PPC) reaffirmed its commitment to securing additional reserves and production through acquisitions this morning.  2009 was difficult year for the company, which underwent a significant restructuring, completed a substantial fundraising and shook up its board of directors.

The company is now focused on advancing its current portfolio of assets in Australia and the United States, and has restated its interest in either bolt-on acquisitions or a larger, transformational deal.

This morning the company also released a brief update on its current trading, ahead of preliminary results which are expected to be released in April.  Net production for the 12 month period ended 31 December 2009 was approximately 280 barrels of oil equivalent per day (boepd), while January 2010 net production averaged around 144 boepd.

While production continued to generate cash flow for the company, President Petroleum also reported on progress with the drill bit.  A two well program at East White Lake, a producing oil and gas field in Louisiana, USA, is underway.  President Petroleum acquired a 25% working interest in the field earlier this year from Peak Energy, who are operator and still retain a 41% interest. Results from both wells are expected before the end of March 2010.  A third well, A-29, which is currently shut-in, is expected to come back online in the first quarter after new tubing is installed and new perforations are added.

Meanwhile in Australia, the company has agreed a revised work programme “in principle” South Australia’s state authorities for PEL 132, which hosts the Delores Project. The revised program includes a significant airborne gravity and magnetic survey to evaluate the potential of the project “before committing further resources.”

Negotiations at PEL 82 are also continuing, where the company is trying to secure a drilling rig to drill up to three exploration wells.

"At the end of 2009 we completed a fundamental re-structuring of the Company which positioned us to grow to mid-cap status through acquisitions and the development of existing and new assets,” Stephen Gutteridge, Chairman of President Petroleum said. “Already this year we have enhanced our US production, reserves and cash-flow, and we expect to have drilled two development wells at the recently acquired EWL field before the end of Q1. We are looking forward to further progress in 2010."  http://www.proactiveinvestors.co.uk/companies/news/13286/president-petroleum-on-the-hunt-for-strategic-acquisitions-13286.html