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Bahamas Petroleum Company hails ‘multiple value drivers’ in 2021 portfolio

11:59, 18th March 2021
Francesca Morgan
Vox Newswire
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Bahamas Petroleum Company (BPC FOLLOW) has told investors that it is now looking at “multiple value drivers” via appraisal, infill and well testing campaigns across its portfolio in 2021.

The group provided an update this morning on its portfolio ahead the upcoming drilling of the Saffron #2 appraisal well, which the group anticipates will start on 17 May 2021.

The Company’s 2021 Trinidad drilling program is expected to commence with the drilling of the Saffron #2 appraisal well, as a follow up to the successful Saffron #1 discovery well completed in March 2020. BPC has a 100% working interest in the Saffron discovery.

It said the mobilisation of various services and equipment is scheduled to start in mid-April with the well then expected to spud on or around 17 May for a period of 25-30 days.

Should drilling be successful, the group said the Saffron #2 appraisal well is expected to deliver immediate oil production rates of 200 - 300 barrels of oil per day (bopd). 

On completion of Saffron #2, a further five to nine production wells are planned to be drilled in 2H21 as part of an overall field development which would include up to 30 wells.

Assuming success at Saffron #2 and these further wells, BPC is projecting average daily production from the Initial Program of up to 1,000 - 1,500 bopd by the end of 2021, which could provide $8-12m of annual net incremental cashflows at US$60 / bbl oil price.

BPC noted that the production of its wider Trinidad portfolio has stabilised at 450 - 500 bopd, with an additional 10 workover projects planned during this year’s second quarter.

It highlighted that more than 40 potential infill drilling locations have been evaluated within the existing producing fields, with four infill wells high-graded and selected for drilling in H2 2021. These wells have projected production rates in the range of 50 - 100 bopd per well.

Elsewhere, BPC said workstreams are ongoing for its appraisal well in Suriname within the Weg Naar Zee production sharing contract area which is expected to be spud this July. It said operational challenges arising from Covid-19 have caused a minor delay in well timing.

"Since we acquired our Trinidad and Tobago and Suriname licenses, the team has worked tirelessly to fully understand their significant potential. This has progressed such that we are now looking at multiple value drivers via appraisal, infill and well testing campaigns across our portfolio during 2021,” commented Simon Potter, CEO of Bahamas Petroleum Group.

He reiterated that BPC’s “immediate focus” is with the upcoming drilling of the Saffron #2 appraisal well in Trinidad, which it anticipates will begin on or around 17 May 2021. 

He added, “Saffron #2 will further our understanding of the field and, in a success case, can quickly be put into production at extremely low cost, potentially adding 200-300 bopd.
 
It is our intention that through these actions we can continue to increase production to more than 2,500 bopd across our portfolio which, with a conservative oil price estimate, can generate significant cash flow."

BPC added that discussions are currently ongoing with various parties in relation to a potential prepay facility over the Company's producing asset base in Trinidad and Tobago.

Shares in Bahamas Petroleum Company have increased by nearly 14% since the beginning of 2021. The stock was trading 4.35% higher this morning at 0.6p in anticipation of the drilling of the Saffron #2 well, which the group anticipates will start on or around 17 May 2021.

Should drilling be successful, the Saffron #2 well in Trinidad is expected to deliver immediate oil production rates of 200 - 300 barrels of oil per day (bopd) while upon its completion, a further five to nine production wells are currently planned to be drilled in 2H21.

BPC price chart

Reasons to FOLLOW BPC

BPC is becoming a multi-asset ‘full cycle’ oil and gas company, with a range of exploration, appraisal, development and production assets and licences, located offshore in the waters of The Bahamas and Uruguay, and onshore in Trinidad and Tobago, and Suriname.

Successful Acquisitive Growth

As a result of its merger with Columbus, BPC has been granted access to high-impact exploration wells in The Bahamas, five producing fields, two appraisal / development projects Trinidad, and an expansive frontier exploration acreage offshore Uruguay and Suriname. 
 
BPC believes the merger will allow both groups to provide something different from within that business cycle to the combined entity and that together the asset base is ‘more robust, has broader interests and is, as a consequence, more financeable and thus more valuable.’ 
 
“With the completion of the merger of BPC and Columbus, we today become a single company, in pursuit of a single-minded vision: the creation of a revenue generating, full-cycle, Atlantic margin exploration and production business,”
said Potter in August. 

He added, “Going forward, BPC is an exploration and production business, intent on generating reliable, growing production cash flows capable of supporting exploration activities, and which together will create significant value for all stakeholders.”

2021 Operations

Following the conclusion of the Perseverance #1 drilling programme, BPC is seeking to consolidate and further strengthen its balance sheet, so as to direct maximum effort towards planned value-adding drilling activities in Trinidad and Suriname during the course of 2021.

BPC’s 2021 work programme in Trinidad and Suriname is focused on near term operational activity, targeting exit production of c.2,500 bopd as well as prospect maturation in Uruguay.

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Disclaimer & Declaration of Interest

The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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