Valeura Energy, the upstream oil and gas company with assets in the Gulf of Thailand and the Thrace Basin of Turkey, reports its unaudited financial and operating results for the three month period ended March 31, 2023 and changes to its executive leadership team.
Q1 2023 Operational Highlights of the Mubadala Acquisition Assets(1)
- Q1 2023 oil production of 20,475 bbls/d;
- Eight development wells drilled on the Jasmine oil field, including seven which are now on production;
- Excellent safety performance, with no recorded lost time incidents, injuries or spills;
- Capital spending of approximately US$34 million; and
- Operating costs of US$38.0 million, equating to approximately US$21/bbl.
(1) Mubadala Acquisition Assets means the upstream oil producing portfolio of Busrakham Oil and Gas Limited acquired by Valeura from Mubadala Petroleum (Thailand) Holdings Limited on March 22, 2023 (the “Mubadala Acquisition”). These metrics relate to the assets’ operational performance during the period January 1, 2023 through March 31, 2023 and are presented for future comparative purposes. Valeura was the operator of the Mubadala Acquisition Assets for the nine-day period from March 22, 2023 through March 31, 2023, and accordingly, only a portion of these results are included along with the balance of Valeura’s operations during the quarter.
Q1 2023 Valeura Financial Highlights(2)
- Cash and cash equivalent resources of US$268.5 million;
- Working capital of US$103.8 million;
- Completion of the Mubadala Acquisition on March 22, 2023 including a bargain purchase gain amount of US$207.6 million; and
- Acquisition of the remaining 12.5% interest in the special purpose vehicle subsidiary company, Valeura Energy Asia Pte. Ltd (the “SPV”) on March 21, 2023, increasing Valeura’s effective interest in its entire Thailand portfolio (including all reserves) by 14.3% for a consideration of 9.5 million shares in Valeura.
(2) These metrics refer to Valeura’s reported performance for Q1 2023, of which, results from the Mubadala Acquisition Assets are included for the period March 22, 2023 through March 31, 2023, in addition to the balance of Valeura’s activities for the entire quarter. These figures are as of March 31, 2023.
Subsequent Development Highlights
- Restart of production from the Wassana oil field on April 28, 2023;
- Increase in working interest to 100% in Licence G10/48, containing the Wassana oil field;
- Divestment of Valeura’s interest in Licence G6/48, containing the undeveloped Rossukon oil field for contingent cash consideration of US$5 million, payable at first oil and a further overriding royalty; and
- Average oil production above 23,000 bbls/d in recent days.
Sean Guest, President and CEO Commented
'I am delighted to present our first quarterly report which includes the producing assets acquired through the Mubadala Acquisition. While the operating results only include the nine-day portion during which Valeura was the operator, the financial impact of having completed the transaction speaks volumes about the magnitude of the transformation our Company has undergone.
Our aggregate cash position at March 31 has increased to US$268.5 million and, even after accounting for the impact of upcoming tax liabilities, this equates to working capital of US$103.8 million. We are relatively unlevered, with just US$49.9 million in debt at quarter end, leaving us with the capacity to do much more with our financial resources to add value for shareholders as we continue to pursue our growth-oriented strategy.
Aggregate oil production from the Mubadala Acquisition Assets averaged 20,475 bbls/d during the quarter. Due to the timing of liftings, no oil was sold during Valeura’s nine days of operatorship, however, at the end of the quarter, we were carrying total inventory of US$95.6 million, approximately 2/3 of which is crude oil in storage prior to sale.
Meanwhile, our combined team of more than 200 people has continued their strong safety performance, with no lost time incidents or other injuries. The entire organisation is invigorated by the combined operational and financial scale and prospects for our Gulf of Thailand businesses and we are continuing to oversee operations in our customary professional manner. To date, drilling operations have focused on the Jasmine oil field where four months of infill drilling and workovers resulted in seven new oil producers and the field’s production has increased approximately 30% relative to the average rate prior to the commencement of drilling. Production at the Wassana oil field was restarted on April 28 and the team is gradually bringing that field back to the expected levels of production. Our focus on growth from these two assets has contributed to average production above 23,000 bbls/d in recent days. Elsewhere, preparations are underway for continued infill drilling at the Nong Yao, Manora, and Wassana oil fields, prior to the expanded development of the Nong Yao oil field in Q4 2023.
As we press forward with integration activities, we are continuing to focus on our governance and leadership priorities, and I am pleased to announce certain changes to our executive leadership team. Kelvin Tang has joined Valeura as Executive Vice President of Corporate, General Counsel, and Corporate Secretary, bringing with him a wealth of knowledge from his many years in executive roles within the Southeast Asia upstream industry. Yacine Ben-Meriem has joined Valeura as Chief Financial Officer, contributing deep financial acumen garnered through the international investment banking sector around the Southeast Asia region. Ian Warrilow has joined Valeura as Thailand Country Manager, a welcome addition back to the Thailand organisation, after having spent much of his career with Mubadala in various international positions including a previous management role with the team in Thailand. All of these executives have deep experience with the assets we have acquired in Thailand.
While Valeura remains a Canadian company, the executive team, including myself, will be based in Southeast Asia so as to remain closely connected to the Thailand business unit and central to the ongoing growth opportunity suite within Southeast Asia. Heather Campbell, our incumbent CFO has opted to leave Valeura rather than re-locate to Southeast Asia and I want to thank her for her long service and contribution toward structuring our business and transforming our portfolio through acquisitions. We have come to rely on her financial rigour and sound advice throughout her career at Valeura, and we wish her well.'
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Source: Valeura Energy
