Hurricane Energy's loss widens but it hails fundraise as "significant endorsement"

 
Courtney Goldsmith
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Cabinets From Both UK And Scottish Governments Meet In North East Scotland
Hurricane Energy's Lancaster field is on track for first oil in the first half of 2019 (Source: Getty)

Hurricane Energy's loss widened in the first half of the year, but the company said it was an "exciting period in Hurricane's history" as it moved towards production.

The figures

The North Sea oil explorer's loss before tax widened to $4.2m (£3.1m) for the six months to the end of June from $2.6m the previous year.

The firm announced financing of $547m during the period, primarily to fund its Lancaster early production system (EPS) as it works to produce first oil in the first half of 2019.

Operating expenses were $6m for the period, up from $4.2m the pervious year.

Shares in the Aim-listed company edged up 1.44 per cent to 27.9p.

Why it's interesting

Hurricane's main focus for the first half of the year has been progressing with plans for the Lancaster EPS.

The Lancaster field holds estimated recoverable volumes of 523m barrels of oil, and planned production is set at 17,000 barrels of oil per day.

The company said the success of the capital raise against a backdrop of low oil prices and a challenging equity market was a "significant endorsement" of Hurricane's fractured basement reservoirs located west of Shetland.

Malcolm Graham-Wood, analyst at Hydrocarbon Capital, has said shares in the company are poised to shoot up in the long term.

What Hurricane Energy said

Robert Trice, chief executive of Hurricane, said:

The first half of 2017 saw the conclusion of a highly successful 265-day drilling campaign that completed the well stock required for the Lancaster EPS, provided further invaluable reservoir data and increased the company's resource estimates exponentially.

We look forward over the coming months to announcing further key milestones in the EPS progression; and to publishing the revised CPR [competent person's report] on Halifax, Lincoln and Warwick. We remain on track for first oil in 1H 2019 and look forward to updating our shareholders as this exciting development progresses.

Read more: Hurricane Energy storms towards "transformational" first oil in 2019

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