JKX's Ukrainian Output Soars in 2019
London-listed junior JKX Oil & Gas, which operates in Ukraine and Russia, has reported a 20% growth in production in 2019 to 10,748 barrels of oil equivalent/day.
In an operations update on January 9, the London-listed junior said it had produced 5,584 boe/day at its fields in northeastern Ukraine, up 52% yr/yr. Production at the company’s Koshekhablskoye field in southern Russia was flat, at 5,158 boe/day.
Its number for Ukraine included 769,000 m3/day of gas, up 55% yr/yr, and 1,058 boe/day of oil and condensate, up 41%. The growth was the result of an ongoing workover and drilling campaign.
JKX noted it had completed a new well at the West Mashivska field in Ukraine in December that was now flowing gas at a rate of 100 boe/day from the deepest of three hydrocarbon-bearing intervals. Production from the other two intervals should start later.
It also completed a new well this month at the Novomykolaivske field, NN82, which is slated to start flowing shortly.
The drilling of the R101 sidetrack well at the Rudenkivske field is underway, JKX said, and should be completed in the first quarter. A rig is also being moved to drill IG143, a follow-up well to the successful IG103 sidetrack and IG142 wells at the Ignativske deposit, it said.
JKX has seen higher earnings this year on the back of its rising production, which has more than offset lower gas prices in Ukraine. The company’s net cash reserves totalled $14.8mn at the end of December, up from $7.9mn a year earlier, and it expects to be debt free after making a final $5.8mn bond payment in February.
“Access to undrawn credit facilities is maintained, although management is confident that execution of field development plans in Ukraine can continue to be financed from operational cash flow,” it said.
JKX typically publishes its full annual financial results in April.
The company remains locked in a legal dispute with Ukrainian tax authorities, which are claiming extra rental fees from the company from 2010 and 2015. JKX said it expected a final resolution of its remaining court cases in 2020 and 2021.