Cadogan Petroleum interims confirm solid and robust financial position


Cadogan Petroleum interims confirm solid and robust financial position

Cadogan Petroleum PLC (LON:CAD) has confirmed a solid balance sheet and robust, cash-generative operations in Ukraine, despite a number of shut-ins and suspensions, in its interim results.

The group ended June, 2020, with US$11.6mln of cash, which it confirmed is sufficient to continue operations for the foreseeable future.

Production for the six month period averaged 230 barrels of oil per day (bopd), down from 297 bopd in the comparative period last year due to the Blazhiv-3 and Blazhiv-Monastyrets-3 wells being offline for over five months.

READ: Cadogan restarts two production wells in Ukraine

At the same time, the company has been impacted by a sharp drop in realised prices over the period – for the six months the average realised oil price was down 33%, gas prices fell further though gas sales were previously halted to preserve reserves until prices improve.

Cadogan noted that it completed the half-year without any lost time incidents and had no cases of coronavirus (COVID-19) among its employees.

The company said it has continued to monitor the protection of its interests in Proger Ingegneria, an Italian services firm, and plans to convert a loan into a direct 33% equity interest. It recently received and is presently analysing legal and financial information communicated by Proger relating to its activities in 2019.

The group said its intended investment strategy was constrained and partly postponed due to market conditions, though in today’s outlook statement it struck a more upbeat tone.

“Looking ahead, the company is confident that strong management and competent staff will ensure a positive outcome for the company in such uncertain and challenging environment,” Cadogan said in the results statement.

It added: “The company will continue to actively pursue opportunities outside of Ukraine, to leverage its competence and low-cost structure in order to create long term value for its shareholders.”

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