Oil and gas producer Parkmead today said it was looking to take advantage of the depressed market by searching out more acquisition opportunities.
The Aberdeen-based firm, led by executive chairman Tom Cross, recently upped its stake in two North Sea oil fields – Dolphin and Perth – in a move that lifted its reserves by 19 per cent to 27.9 million barrels of oil equivalent.
Parkmead maintains its appetite for acquisitionsTom Cross
Cross said: “Parkmead is well positioned to take advantage of the ongoing lower oil price environment, and the opportunities that are arising from this.
“We have excellent regional expertise, significant cash resources, and a growing, low-cost gas portfolio. The group will continue to build upon the inherent value in its existing interests with a licensing and acquisition-led growth strategy, securing opportunities that maximise long-term value for our shareholders.”
His comments came as Parkmead reported dramatically lower pre-tax losses of £6.4 million for the year to the end of June, down from £30.8m a year earlier, as lower operating costs helped to offset a decline in revenues, which fell to £10.4m from £18.6m the previous year.
“During the financial year the price of Brent crude oil averaged $43 per barrel and fell to a 13-year low of $26 per barrel in January 2016,” the firm said.
“This is a significant reduction from the previous year’s average oil price of $74 per barrel and has therefore severely impacted the revenues and cash flows of oil and gas producers globally. Parkmead and its co-venturers have worked tirelessly to reduce operating costs across the entire asset portfolio to reflect the considerably altered macro environment.”
Despite the challenges of the low oil price environment, Cross said the group had turned in an “excellent year of progress”, with output from its Diever West field – discovered and brought onstream in just 14 months – helping its net gas production in the Netherlands jump more than six fold.
He added: “A number of enhanced production opportunities have been identified within Parkmead’s existing Netherlands portfolio, which the group intends to capitalise on with the aim of further increasing its gas production.
“As we move towards 2017, Parkmead maintains its appetite for acquisitions. We will also seek to add shareholder value through a dynamic work programme to maximise the inherent value in our existing assets.”