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Friday, 9 November 2012
Xcite Energy generates £13.3 mln from oil sales
Xcite Energy (LON:XEL, CVE:XEL) has confirmed that £13.3 million (C$21.2 million) was generated through the sale of crude oil and diluents produced in Phase 1A of the Bentley oil field development.
It also told investors that the proposed farm-out process will move forward with the ‘initial engagement process’ starting before the end of this year.
According to the company there is significant amount of work ahead and 2013 will be an important year.
The immediate priority, it says, is to analyse the information garnered through Phase 1A to update reservoir models and production profiles. This process will also incorporate the new acreage that was awarded to the company last month.
These reports, along with newly acquired 3D seismic, will form part of an updated reserves report and will be used in the bank’s review process for the agreed reserves based lending.
Among the other key milestones for 2013 are a possible farm-out deal, the submission of an updated field development plan to the DECC, and the start of the Phase 1B development programme.
Reporting on the accomplishments of the past quarter Xcite said Phase 1A’s findings had exceeded management expectations.
It said the information regarding the water breakthrough was better than expected, which put simply meant less water was produced.
Also the understanding of the oil, gas and water behaviour has been significantly improved, Xcite said.
A total of 149,000 barrels of crude and 58,000 barrels of diluent was produced during the Phase 1A production testing.
This was sold via a marketing arrangement with BP which generated £13.3 million of revenue. Xcite reported a £0.57 million (C$910,000) loss for the third quarter, and it ended the period with £54.6 million (C$87.2 million) of cash.