EASTLEIGH, UK / ACCESSWIRE / June 7, 2023 / i3 Energy plc (AIM:I3E) (TSX:ITE), an independent oil and gas company with assets and operations in the UK and Canada, is pleased to announce the audited results for the year ended 31 December 2022. A copy of the Company's financial statements will be posted to shareholders and made available shortly on the Company's website at https://i3.energy. The Notice of Annual General Meeting ("AGM") will be posted in due course. The AGM will be held at 11:00 am BST on 30th June 2023 at the offices of WH Ireland Limited at 24 Martin Lane, London, EC4R 0DR.
2022 FINANCIAL, RESERVES & PRODUCTION HIGHLIGHTS
UK AND CORPORATE
Average daily production (BOE/d)
Group Revenue (£m)
2P reserves (MMBOE)
Group Profit / (loss) after tax (£m)
PDP reserves (MMBOE)
Group NOI (£m) (1)
2P reserves Before-tax NPV 10 (USDm)
Group Adjusted EBITDA (£m) (1)
Dividends declared (£m)
(1) Non-IFRS measure. Refer to Appendix B
Organic Production Growth Delivering Record Production
- Four quarters of production growth with peak daily rates exceeding 24,000 barrels of oil equivalent per day ("boepd").
- Increased dividends declared from £3.4 million in 2021 to £17.4 million in 2022 and announced 2023 dividend guidance of £24.5 million (2.052 pence / share).
- £75.8 million capital expenditure in 2022 delivered 31 gross (20.1 net) wells.
- Increased the Group's leasehold position to 628,000 net acres.
- Aggregate well productivity met or exceeded management expectation and key wells drilled in strategic Simonette and Clearwater acreage.
- Through participation in land sale auctions, farm-ins and joint ventures, and partner consolidation, i3 has grown its acreage in the strategic Clearwater play to greater than 69,600 acres (109 sections) with an average working interest of 76%
- Farmed out 25% of the Serenity licence to Europa who paid 46.25% of the Serenity 13/23c-12 appraisal well costs. The well was drilled in October 2022. The company is evaluating one well development options.
- Our 2022 capital program helped to increase Proved plus Probable reserves ("2P") by 18% to 182 Million Barrels of Oil Equivalent ("mmboe"), resulting in reserves replacement of 479% on a 2P basis.
- The Group now has 376 gross booked drilling locations in its audited reserves and 940 including un-booked locations.
- Published inaugural annual ESG Report.
- Eliminated all high-bleed pressure controllers and commenced installation of solar powered pumps. These initiatives when complete will eliminate 71,450 tonnes CO2e methane emissions equivalent to taking circa 16,000 cars off the road.
- Completed the electrification of 7 pumpjacks in Carmangay and Retlaw to reduce use of diesel and propane for power generation, with a further 29 electrifications underway.
- Implemented efficient disposal of oil based drilling fluid, avoiding 2,500 tonnes of CO2e emissions.
- Ongoing annual abandonment and reclamation program abandoned 69 wells and decommissioned 37 well sites, representing approximately 14% of operated non-producing wells.
A summary of key events which occurred after the reporting period are presented in note 24 to the financial statements and includes the announcement on 31 May 2023 of the successful redemption of the Company's outstanding £22 million H1-2019 Loan Notes (the "Loan Notes"), due 31 May 2023, and the establishment of a CAD 100 million debt facility, which will provide i3 greater financial flexibility and enhanced credit capacity to further execute its ongoing business plan. The Company's focus for the remainder of 2023 will be on three key areas:
- The growth of i3's Canadian business through the deployment of capital into its large proven undeveloped reserves base, operational excellence to improve uptime and field performance, and strategic upsizing in core areas;
- Maintaining flexibility to adapt to economic challenges while maximizing total shareholder return; and
- Conducting its operations safely and in an environmentally secure manner.
The Company continuously evaluates opportunities to strengthen its balance sheet whilst maintaining tight control of its costs and working capital position.
Majid Shafiq, CEO of i3 Energy plc, commented:
"Following an active period of acquisitions over the course of 2020 and 2021, 2022 was a period of consolidation and organic growth. Our most recent significant acquisition in Q3 2021 of circa 8,400 boepd in our core Central Alberta area from Cenovus Energy, was integrated into our Canadian business and operational and organisational efficiencies implemented across our entire portfolio. Commodity price strength in the second half of 2021 led us to pivot from growth via acquisitions to organic growth through the exploitation of our extensive inventory of drilling locations and in January 2022 we commenced our inaugural operated drilling program with an announced USD47 million budget. Based on the positive results from the wells drilled in Q1 2022, the Canadian capex program was expanded to circa USD90 million and during the course of the year we drilled a total of 20.1 net wells in Canada. The program was very successful with all wells meeting or exceeding management expectations in terms of production performance and costs versus budget. In conjunction with an extensive workover program the new wells contributed to the achievement of our stated goal of reaching 24,000 boepd before the end of the year and also to a very positive year end reserves audit which resulted in an 18% increase in our booked 2P reserves and a 479% increase in our reserves replacement ratio on a 2P basis. In the UK, a farmout of the Serenity appraisal well allowed the company to significantly reduce its capital exposure and the well was successfully drilled to complete the appraisal of the field. The potential for a single well development is being evaluated.
2022 also saw the publication of our maiden ESG report and we are very pleased that activities throughout the year saw significant reductions in CO2e emissions as we began to implement methane emission reduction initiatives. We continued to deliver on our total shareholder return model, as we balanced our production growth with increased cash returns to investors with an expanded dividend program which saw over £17.4 million in dividends being declared during the year.
The first half of 2023 has seen continued operational and commercial activity. Our 2023 capital program has commenced with the pre-spring break component completed and we are very pleased to have repaid our outstanding debt and established a new CAD100 million loan facility, which validates the quality and scale of our reserves base in Canada.
All of this was possible due to the expertise and commitment of our staff in Canada and the UK and I would like to thank them for their continued efforts and all our investors and shareholders for their continued support. We look forward to another successful year as we navigate the operational and business challenges that lay ahead with continued dedication and hard work".
AIM Application - Correction
i3 also announces that, further to the announcement on 17 May 2021, 5,277,045 ordinary shares ("Ordinary Shares") were issued to Baker Hughes, a GE company (GE Oil & Gas UK Limited and Baker Hughes collectively referred to hereafter as "BHGE") in relation to warrants exercised and these were not admitted to trading on AIM at that time. An application will be made for the Ordinary Shares to be admitted to trading on AIM and are expected to be admitted on 13 June 2023.
The Ordinary Shares rank pari passu with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared after the date of issue.
Following Admission of the Ordinary Shares, the Company's issued share capital will though remain the same as previously reported at 1,201,874,464 Ordinary Shares with a nominal value of £0.0001 each. Shareholders may use this figure of ordinary shares as the denominator by which they are required to notify their interest in, or change their interest in, the Company under the Disclosure Guidance and Transparency Rules.
Qualified Person's Statement
In accordance with the AIM Note for Mining and Oil and Gas Companies, i3 discloses that Majid Shafiq is the qualified person who has reviewed the technical information contained in this document. He has a Master's Degree in Petroleum Engineering from Heriot-Watt University and is a member of the Society of Petroleum Engineers. Majid Shafiq consents to the inclusion of the information in the form and context in which it appears.
i3 Energy plc
Majid Shafiq (CEO)
Tel: +44 (0) 203 781 8338
WH Ireland Limited (Nomad and Joint Broker)
James Joyce, Darshan Patel
Tel: +44 (0) 207 220 1666
Tennyson Securities (Joint Broker)
Tel: +44 (0) 207 186 9030
Stifel Nicolaus Europe Limited (Joint Broker)
Ashton Clanfield, Callum Stewart
Tel: +44 (0) 20 7710 7600
Georgia Edmonds, Violet Wilson, Sam Morris
Tel: +44 (0) 203 781 8338
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SOURCE: i3 Energy PLC