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Share Name Share Symbol Market Type Share ISIN Share Description
Jkx Oil & Gas Plc LSE:JKX London Ordinary Share GB0004697420 ORD 10P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.25 -0.65% 38.25 37.50 39.00 39.00 38.25 38.25 11,900 08:00:27
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 50.9 18.2 8.5 4.4 66

JKX Oil & Gas PLC Quarterly Operations Update

13/10/2021 12:52pm

UK Regulatory (RNS & others)


Jkx Oil & Gas (LSE:JKX)
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From Oct 2021 to Dec 2021

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TIDMJKX

RNS Number : 9799O

JKX Oil & Gas PLC

13 October 2021

13 October 2021

JKX Oil & Gas plc

("JKX", the "Company" or the "Group")

Quarterly Operations Update

Highlights

 
   --   Ukraine average production of 4,499 boepd for Q3 2021, 
         10% higher than during Q2 2021. 
   --   Net $51.5m of cash and cash equivalents, and oil and 
         gas inventory of approximately $4.1m in value, held at 
         30 September 2021. 
   --   Gas and oil prices in Ukraine have significantly improved 
         by almost 150% and 60% respectively in comparison with 
         the first 9 months of 2020. 
   --   R110, a new well in the Rudenkivske license, was spudded 
         on the 14(th) September and on the 6(th) October was 
         drilling ahead at 2,642m MD RT. 
   --   The Board made a decision to dispose of the Group's 100% 
         interest in its Russian operating subsidiary 
 

Production

 
                                  Q3      Q2      Q on     9 months   9 months    Y on 
                                                    Q                               Y 
                                                    %                               % 
                                                  Change                          Change 
                                 2021    2021                2021       2020 
 Total production, boepd         8,575   9,332    (8)%      9,026      10,378     (13)% 
 Ukraine, boepd                  4,499   4,101     10%      4,150      5,016      (17)% 
 - Average gas production, 
  Mcmd                            586     521      12%       542        673       (19)% 
 - Average oil and condensate 
  production, boepd              1,051   1,032     2%        962       1,054      (9)% 
 Russia, boepd                   4,076   5,231    (22)%     4,876      5,362      (9)% 
 - Average gas production, 
  Mcmd                            685     879     (22)%      819        901       (9)% 
 - Average condensate 
  production, boepd               46      58      (21)%       54         62       (13)% 
 Hungary, boepd                    0       0       0%         0          0         0% 
 Prices realised 
 Ukraine 
 - Average gas price, 
  $/Mcm                           431     250      72%       305        123       148% 
 - Average oil and condensate 
  price ($/bbl)                   72      65       11%        67         42        60% 
 Russia 
 - Average gas price, 
  $/Mcm                           65      52       25%        56         53        6% 
 

In Ukraine:

 
   --   R110, a new well in the Rudenkivske license, was spudded 
         on the 14(th) September and on the 6(th) October was 
         drilling ahead at 2,642m MD RT with an expected TD of 
         3,319m MD RT. 
   --   IG149, a new well in the Ignativske field, had 12m of 
         perforations added in August which has increased the 
         gas rate from 55 Mcmd to an average of 72 Mcmd since 
         perforating. The wellhead pressure has increased from 
         722 psi to an average of 1,504 psi since the additional 
         perforations and a choke reduction. 
   --   IG103 sidetrack gas rate has increased from 46 Mcmd to 
         71 Mcmd following a recent choke increase and 3m of perforations 
         added. 
 

In Russia:

 
   --   YGE commenced a new gas sales contract in Q3 2021 with 
         gas sales prices 25% higher than under the previous gas 
         sales contract. 
   --   Essential maintenance was carried out in a 3 week plant 
         shutdown for the transition to the new gas sales contract. 
   --   The negotiations for contracting the workover of Well 
         20 are in process and they should be completed in the 
         coming weeks with the rig to be immediately mobilised 
         to the wellsite. The drilling contractor is the same 
         as was used to successfully workover Well 18. 
 

In Hungary:

 
   --   JKX agreed the terms for the sale of the entire share 
         capital of its wholly owned Dutch subsidiary JKX (Nederland) 
         B.V. to Mr Gabor Lujas Dudinsky and Mr Laszlo Arpad Barbuty 
         for a total cash consideration of $3m. 
   --   JKX (Nederland) B.V. holds, via its wholly owned Hungarian 
         subsidiary, Folyopart Energia KFT, a number of Hungarian 
         mining plots and a production facility that are not currently 
         producing hydrocarbons. Folyopart Energia KFT had gross 
         assets of tHUF 1,074,232 ($3.6m) as at 31 December 2020 
         and reported loss of tHUF 2,718 ($9.1K) according to 
         Hungarian GAAP. 
 

Liquidity

 
 In $m                              30 Sep   30 June   31 Dec   30 Jun   31 Dec 
                                      2021      2021     2020     2020     2019 
 
 Total cash and cash equivalents      51.5      36.5     24.3     14.5     20.6 
 Bond liability (principal 
  and interest accrued)                  -         -        -        -    (5.7) 
 Net cash                             51.5      36.5     24.3     14.5     14.9 
 
 Approximate sales value 
  of gas and oil inventory             4.1       4.4      2.2      1.7      4.1 
 

Our Ukrainian subsidiary held 3.2 million cubic metres of gas and 33.6 thousand barrels of oil inventory available for immediate sale at 30 September 2021. Approximate sales value of gas and oil inventory is calculated using average sales prices for September 2021.

Rental fee claims

Claims issued by the Ukrainian tax authorities for additional rental fees for 2010 and 2015 are still being contested through the Ukrainian court process as explained in the 2021 Half-yearly Report. In July 2021 the Supreme Court satisfied demands of Poltava Petroleum Company (PPC) in respect of the case No. 816/844/16 and left the decisions of first and appellate instance courts in force. Also PPC has received the final judgement of the Supreme Court of Ukraine in Case No.816/4476/14 relating to the Poltava Tax Authorities appeal against lower court judgments in this case. This case relates to a claim for 2010 royalty payments and a judgment has been made in favour of the Poltava Tax Authorities. PPC is under no immediate obligation to pay the judgement as the Ukrainian tax authorities have to obtain approval of the Supreme Court of Ukraine before the payment can be collected from PPC. This hearing is expected to be heard in late 2021.

International arbitration award

The international arbitration award, directing the State of Ukraine to pay $11.8m plus interest and $0.3m costs to JKX as described in the 2020 Annual Report, was successfully legally recognised in Ukraine and JKX filed for collection. No possible future benefit that may result from this award will be reflected in the accounts until there is further clarity on the process for, and likely success of, enforcing collection.

Covid-19

The Group has all necessary arrangements in place to ensure the safe conduct of its business. We have implemented a number of policies recommended by Governments in the countries of our assets for the protection of our employees, as well as to help minimization of the spread of coronavirus (Covid-19). Our first priority is the safety and wellbeing of our staff. Our next priority is supporting the local communities, especially where there is a lack of medical assistance, and we have directed our corporate and social responsibility projects helping to fight further spread of Covid-19. We continue to monitor the impact of Covid-19 developments on our industry, operations, staff and contractors and are confident about the safety measures we put in place.

boepd - Barrels of oil equivalent per day

bopd - Barrels of oil per day

Mboe - Thousand barrels of oil equivalent

Mcm - Thousand cubic metres

MMcm- Million cubic metres

Mcmd - Thousand cubic metres per day

psi - pounds per square inch

tHUF - Thousand Hungarian Forint

This announcement contains inside information as defined in EU Regulation No. 596/2014 and is in accordance with the Company's obligations under Article 17 of that Regulation.

ENDS

   JKX Oil & Gas plc                              +44 (0) 20 7323 4464 

Dmytro Piddubnyy, CFO

   EM Communications                         +44 (0) 20 7002 7860, +44 (0) 7887 946719 

Jeroen van de Crommenacker

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