OFFSHORE oil explorer and producer Heritage Oil’s share price fell yesterday after its full-year results revealed that production at its newly-acquired Nigerian oil field was lower than expected.
The FTSE 250-listed firm said gross output at the OML 30 oil field had been at 20,350 barrels of oil per day (bopd) since the acquisition last year.
“The thing that surprised us was the production number from the OML 30 asset since acquisition which is lower than expected due to a faulty manifold and a local workers’ strike,” Tim Hurst-Brown, research analyst at Mirabaud Securities, told City A.M. Heritage has resolved the strike and is repairing the equipment by the end of May, so production is expected to go back up to 35,000 bopd.
“Although the majority of the fields are now back on-stream, these issues serve as a reminder of the challenges involved in operating in the Niger Delta region and are the main reason for today’s share price weakness,” said Hurst-Brown.
Heritage Oil also said yesterday that exploration in Tanzania would continue after “initial promising results” and that drilling would start next year.
The company’s share price closed down six per cent at 160p.