Saffron Energy PLC Saffron 104% production increase in June quarter (5211K)

TIDMSRON

RNS Number : 5211K

Saffron Energy PLC

10 July 2017

10 July 2017

Saffron Energy Plc

("Saffron" or "Saffron Energy" or the "Company")

Saffron Energy 104% gas production increase in June quarter

Saffron Energy (LON:SRON), the AIM quoted European natural gas company is pleased to announce its quarterly production update for the three months ended 30 June 2017.

Q2 Gas Production

Production from the Saffron Energy operated gas fields, Sillaro (100%) and Bezzecca (90%), has increased by 104% from 862,000 standard cubic metres (30.4 mmcf) in the quarter ended 31 March 2017 to 1.762 million standard cubic metres (62.2 mmscf) in the quarter ended 30 June. This increase was driven primarily by the commencement of production from the Bezzecca field in mid-April 2017.

Revenue from gas sales to Shell Energy Italia has also increased by 93%; in line with the increase in production. Saffron attained a gas price of approximately EUR0.21 per cubic metre in Q2 compared to EUR0.226 in the previous winter months' quarter.

Gas Production and Sales

 
                                  Q1        Q2   Change       YTD 
                                  17        17      (%)        17 
--------------------------  --------  --------  -------  -------- 
 Total production ('000 
  cubic metres)                  862     1,762     104%     2,624 
 Total production ('000 
  cubic feet)                 30,441    62,224     104%    92,665 
 
 Daily production (cubic 
  metres per day)              9,370    19,368     104% 
 Daily production ('000 
  cubic feet per day)            331       684     104% 
 Daily production (boepd)         57       118     104% 
 
 Revenue (EUR)               195,000   376,000      93%   571,000 
 Average gas price (EUR 
  per cubic metre)             0.226     0.213     - 6% 
--------------------------  --------  --------  -------  -------- 
 

Current activity

Saffron expects that gas production and revenue will increase further in the third quarter ending 30 September 2017, driven by a full three months contribution of production from the Bezzecca field.

The Bezzecca gas field was completed and commissioned in Q2 with first gas flows on 18 April and full commercial production commencing at a steady state from Level A interval in mid-May 2017.

Over the first two weeks of July, the Company will install a downhole choke at Bezzecca and production from the field will recommence immediately afterwards from several levels, namely Level A, S and possibly R. Production rates in Level A will be adjusted down to allow for increased aggregate production from multiple levels.

Chief Executive Officer of Saffron Energy, Michael Masterman commented: "After a successful IPO in February 2017 and first gas achieved at Bezzecca in April, I am pleased to announce the significant increase in our natural gas production, which translates into higher revenues. We have been able to deliver Bezzecca on time and despite the short delay on the production concession grant we are making good progress of Sant'Alberto. We are at the beginning of a journey to make Saffron a mid-cap European natural gas production company".

About Saffron Energy PLC

Saffron Energy is a natural gas producer with interests in Northern Italy. Its portfolio includes two gas production fields; Sillaro (100%) and Bezzecca (90%) and an application for a near gas production field called Sant'Alberto. All of Saffron's assets are located near Milan and Bologna. Saffron Energy commenced trading on the London AIM Market under the ticker of SRON on 24 February 2017.

For more information, please visit www.saffronenergy.co.uk or contact the following:

 
 Saffron Energy plc                  [phone] 
 Michael Masterman, CEO              [e-mail] 
 
 Grant Thornton UK LLP (Financial    [phone] 
  & Nominated Adviser)                5100 
 Colin Aaronson 
 Samantha Harrison 
 Harrison J Clarke 
 
 Turner Pope Investments (TPI) 
  Ltd (Broker)                       [phone] 
 Ben Turner                          [e-mail] 
 James Pope 
 
 Cassiopeia Services (PR/IR)         [phone] 
 Stefania Barbaglio                  [e-mail] 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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July 10, 2017 02:00 ET (06:00 GMT)