JKX boosts hydrocarbon production 1.5% yoy in 1H18

Date 2018/7/6 10:06:18 | Topic: Bus./Industry

Analyst: “So far, we see the company’s new tactics in Ukraine - focusing on low-cost workover of old state wells and developing its own wells in most historically successful area - is paying off.”


 

 

 

 

 

 

 

 

KYIV, June 6, 2018 - JKX Oil & Gas (JKX LN) produced 8,728 boepd of hydrocarbons in 1H18, or 1.5% more yoy, Concorde Capital informed its clients based on JKX’s July 5 trading update. The increase was fueled by 10.6% higher output in Russia (to 5,146 boepd), while production in Ukraine fell 7.3% yoy to 3,491 boepd. Improved performance in Russia was due to a low comparison base (as one of the wells was idle a year ago).

 

In 2Q18, the company produced 8,707 boepd of hydrocarbons, which is 0.5% less qoq but 12.1% more yoy. Importantly, JKX managed to boost production in Ukraine by 5.6% qoq to 3,585 boepd, which is a result of its newly commissioned well M158 in late March, as well as the successful workover of three wells leased from the state (R22, EM52 and R3). Nevertheless, JKX’s Ukrainian output decreased 0.9% yoy in 2Q18. The company is going to commission another state-leased well (NN10) shortly. On top of that, the company nearly completed drilling of its E308 well at its most successful Elizavetivske field.

 

In Russia, JKX mined 5,030 bopepd in 2Q18, which is 4.4% less qoq (due to a natural decline of output at existing wells) but 26% more yoy (due to a low comparison base).

 

Concorde analyst Alexander Paraschiy added: “Providing its new wells will be successful, JKX has a high chance to further improve hydrocarbon output in Ukraine in 3Q18 and boost total Ukrainian output by about 2% yoy in full year 2018. So far, we see the company’s new tactics in Ukraine - focusing on low-cost workover of old state wells and developing its own wells in most historically successful area - is paying off. That improves chances for the company to sustain itself in the mid-term, while we warn that the issue of large tax claims in Ukraine remains the core risk for JKX.”

 

###

 

For more information, link here: www.concorde.ua 

 





This article comes from Ukraine Business Online
http://www.ukrainebusiness.com.ua

The URL for this story is:
http://www.ukrainebusiness.com.ua/modules/news/article.php?storyid=20488