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UK: Hurricane Energy announces full-year results 2022


26 May 2023

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Hurricane Energy, the UK based oil and gas company, announces its full-year results for the period ended 31 December 2022.

Highlights

Financial results

  • Revenues of $310.8 million from six liftings of Lancaster crude (2021: $240.5 million from seven liftings)
  • Cash production costs of $37.4/bbl (2021: $28.2/bbl)
  • Generated $175.9 million of free cash flow†, equivalent to $56.9/bbl (2021: $135.7 million, $36.2bbl)
  • Profit after tax for the period of $108.7 million (2021: $18.2 million)
  • Net free cash† of $121.4 million (31 December 2021: $51.5 million)
  • Full bond repayment made in July 2022 of outstanding Convertible Bonds leaving the Company debt free

Operations

  • Production within guidance with average daily rate of 8,500 bopd (2021: 10,300 bopd)
  • Excellent operational uptime of 97%, covering planned and unplanned events
  • Crude oil sales of 3.2 Mbbls sold across six cargoes in 2022
  • Agreement reached in March 2022 with Bluewater for an extension to the Bareboat Charter for the Aoka Mizu FPSO
  • Following technical reassessment, the Greater Warwick Area (GWA) was relinquished in July 2022 by the GWA Joint Venture

Corporate

  • In February 2022, Philip Wolfe took over from John Wright as Chairman, followed by Juan Morera being appointed as a shareholder nominated Non-Executive Director in March 2022
  • In May and July 2022, Linda Beal and Robin Allan respectively were appointed to the board as Independent Non-Executive Directors
  • In November 2022, following receipt of an unsolicited bid for the Company valuing each share at 7.7p which the Board concluded should not be recommended to shareholders, the Company launched a Formal Sale Process , the results of which were announced post period

Post Period

  • In March, following the FSP process, the Board recommended an acquisition of the entire issued, and to be issued, share capital of the Company by Prax Exploration & Production PLC, to be effected by means of a Scheme of Arrangement under Part 26 of the Companies Act 2006 (the Scheme), valuing each share at up to 12.5 pence in total
  • Shareholder and applicable regulatory approvals for the recommended acquisition were received in May 2023
  • The Court Sanction Hearing to consider the Scheme is scheduled for 7 June 2023. The Scheme remains subject to certain other conditions, including sanction by the Court at the Court Sanction Hearing and the delivery of a copy of the Court Order to the Registrar of Companies. Subject to the Scheme receiving the sanction of the Court, the delivery of a copy of the Court Order to the Registrar of Companies and the satisfaction (or, where applicable, the waiver) of the other Conditions set out in Part III of the Scheme Document, the Scheme is expected to become effective on 8 June 2023.

Antony Maris, CEO of Hurricane, commented:

'2022 has been both very challenging and a highly successful year for Hurricane, whilst also an extraordinarily volatile period for our sector.  During the year, the importance of domestic energy security was exacerbated by the terrible events in Ukraine and by the subsequent concerns over energy supplies across Europe resulting in surging commodity prices. 

The resulting high oil price early in the year, combined with outstanding operational performance at the Company's Lancaster field, significantly strengthened Hurricane's finances. Alongside this, working closely with our FPSO operator, we delivered superb uptime performance and produced towards the upper end of our annual production guidance. The field has now produced more than 15 million barrels.

The delivery of a technically skilled and commercially efficient, debt-free Company enhanced our industry reputation and attracted outside investor interest.

All this is a great credit to the team's ability and commitment which, given the challenges of the last few years in particular, have delivered full value and a great return for Shareholders.'

†Designates a non-IFRS measure. See Appendix B to this announcement for definition and reconciliation to nearest equivalent statutory IFRS measures.

Original article link

Source: Hurricane Energy





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