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Bahamas Petroleum Company PLC adds former BP Trinidad chief to board as Saffron well spud date approaches

Trinidad is becoming increasingly important to the company, not least because of the imminent spudding of the Saffron well

() – soon to be renamed as Challenger Energy Group – has appointed BP’s former country manager for Trinidad to its board.

Robert Riley will join the company as a non-executive director.

The appointment of Riley comes as the company is putting its focus on production-led growth, primarily in Trinidad. He brings significant in-country experience as he was previously BP’s chief executive and chairman for Trinidad.

“We are focussed on resetting the company and positioning it for future value growth, consistent with a simple strategy: increasing production and generating cashflow,” said BPC chair Bill Schrader. “Robert brings a wealth of industry, legal and commercial experience, and specifically in regards to the oil and gas sector in Trinidad and Tobago.”

READ: BPC to reset and rebrand as Challenger Energy

“We expect that Robert, together with Stephen Bizzell who as previously advised will also be joining the board subject to completion of normal onboarding processes, will be able to make immediate and extremely valuable contributions to the effectiveness of our operations going forward.”

The company also highlighted that preparations for the Saffron-2 appraisal and development well in Trinidad continue to “advance at pace”.

Rig mobilisation to the Saffron-2 well site has now been completed, it noted.

The rig is now being assembled and the programme remains on schedule for a May 23 spud-date.

Once underway is it expected that the drill programme will last for 25 to 30 days.

Saffron well kicks off production growth

Success at Saffron-2 promises to unlock a phase of production growth for the company.

Saffron-2 itself is predicted to flow at rates of 200 to 300 barrels of oil per day (bopd), which by the company’s projections would equate to more than US$1.8mln of cashflow per year. The company expects the well will achieve payback in 12 to 18 months and deliver a better than 200% return on investment.

A further five to nine further production wells are then planned to follow in Trinidad this year as part of a phase of field development which could comprise a total of 30 wells.

The company aims to establish some 1,000 to 1,500 bopd of new production from the 2021 wells, to generate US$8mln to US$12mln of annual cashflow (based on a US$60 per barrel crude price).

Beyond that, a fuller development programme could see production peak at around 4,000 bopd, to generate around US$25mln of cashflow per year.

Director share buying

In a separate statement on Thursday the company told investors that a number of its directors are participating in an open offer share sale which accompanied the recently announced equity placing.

Eytan Uliel, who becomes chief executive later this month, is increasing his existing shareholding (of some 59.1mln shares) by taking up a further 24mln open-offer shares, whilst outgoing chief executive and soon-to-be non executive director Simon Potter is subscribing for 33mln shares open offer shares to take his holding to around 114mln shares.

Chairman Bill Schrader the company’s continuing and retiring non-executive directors also intend to subscribe for shares.

In aggregate, some 85mln new shares will be bought by members of the management team, representing around £300,000 of the raise.

“I am pleased to confirm that in addition to my own contribution, all continuing and retiring directors, as well as key members of the company’s executive management team, have indicated a meaningful contribution to the current fundraising.

“I am grateful for this vote of support in me as I assume the role as CEO, as well as the strong confirmation it represents of the collective team’s commitment to the task at hand, and our firmly held belief that the assets will deliver in the way we intend.”

The company announced its £6.9mln equity funding in April alongside its plans to relaunch as Challenger Energy Group.

Read More: Bahamas Petroleum Company PLC adds former BP Trinidad chief to board as Saffron well spud date approaches

2021-05-13 01:31:00

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