Ruspetro narrows losses as it scrabbles for bank financing

RUSSIAN-focused oil and gas firm Ruspetro narrowed its full-year losses yesterday, as its chief executive admitted it had faced “significant challenges” over the year, and said talks were ongoing with its major lender over financing.

Ruspetro’s losses narrowed to $27.3m (£18m) over the year, down from $85.1m in 2011 on revenues of $76.2m, up 97 per cent from $38.7m the previous year.

Management is still in talks with its lender over funding of its field development plan, the Siberia-based company said yesterday. If additional financing is not forthcoming, Ruspetro doubts could be cast on the firm’s ability to continue as a going concern.

Despite the bleak note, Ruspetro’s proven reserves increased 35 per cent over the year to 234m barrels, including a 32m barrel increase in oil and 29m barrel jump in gas reserves.

Production jumped 81 per cent over the year to 4,639 barrels of oil equivalent a day, although it fell way short of its 10,400 barrels a day target.

Chief executive Don Wolcott said yesterday that Ruspetro, which listed on the London Stock Exchange in January 2012, would continue to focus on growing cash generation and developing the gas play in the north of the Western Siberian field.

“With these aims in mind we are currently working with our lender to arrange the required financing,” he added.

Shares closed down 9.09 per cent yesterday at 20p each as investors were spooked by the update.