Igas posts $50mn turnover for 2021
London-listed energy producer Igas said on April 6 it had significantly reduced its post-tax loss in 2021 to £6mn ($7.8mn), from £42.1mn year/year.
The company saw revenues climb from $21.6mn in 2020 to £37.9mn last year, while earnings before interest, tax depreciation and amortisation rose 47.5% to £5.9mn in 2021. Due to COVID-19, Igas's average net output was reduced to 1,962 barrels of oil equivalent/day, from around 2,100 boe/d under normal circumstances. However its turnover increased due to better oil and gas prices, and improved production year/year.
Igas' debt load remained fixed at £12.2mn, but its cash holdings were marginally higher at £3.3mn from £2.4mn in 2020. It has relinquished £268mn in ring fenced corporate taxes related to its upstream activities, and said its operating costs averaged around $37/boe in 2021.
Igas' upstream portfolio contains over 90 UK assets that principally produce oil. It held 2P reserves estimated at 17.1mn boe as of 2020.
In addition to its core activities, Igas is diversifying to satisfy UK heating demand. It is developing deep geothermal reservoirs that could receive state funding through the country's Green Heat Network Fund, a £288mn grant award scheme designed to foster low and zero-carbon heating infrastructure.
Igas is expanding its oil output with two UK onshore prospects projected to deliver around 300 barrels/day in total. But it also has significant exposure to shale gas through its licensing portfolio of 292,100 net acres and a single inactive shale well in north Nottinghamshire.
While England banned the use of hydraulic fracturing in late 2019, Whitehall announced on March 5 that the British Geological Survey would undertake a scientific review of the technique, with the study due to report back in June.
Igas said the debate on energy security in light of the Ukraine war must focus on the contribution of natural gas, which currently satisfies 40% of the nation's total energy requirements. It believes reversing the ban on UK shale would help lower gas prices and limit the need for energy imports, which often lead to more carbon emissions than gas domestically extracted.
The British economy would be a major beneficiary of new shale developments, Igas argued, as the country's trade balance of payments would improve and industrial jobs could be created away from the financial services epicentre in London. Bolstering regional development outside the capital was a core part of the government's manifesto.
Igas said: "Comparing UK spot gas prices with US spot gas prices at a fraction of the cost, demonstrates how a domestic gas supply can decouple gas prices from expensive LNG prices."