TIDMPXEN
RNS Number : 3513U
Prospex Energy PLC
01 August 2022
Prospex Energy PLC / Index: AIM / Epic: PXEN / Sector: Oil and
Gas
1 August 2022
Prospex Energy PLC
('Prospex' or the 'Company')
El Romeral: Income and Production Update
Prospex Energy PLC (AIM: PXEN), the AIM quoted investment
company focused on European gas and power projects, is pleased to
provide an update on the production and income from the El Romeral
power plant in southern Spain ('El Romeral'). El Romeral continues
to provide a very healthy income stream from selling electricity
into the spot market in Spain. The Company holds a 49.9% working
interest in El Romeral through its interest in Tarba Energía S.L.
('Tarba').
Highlights:
-- El Romeral revenue for the quarter April to June 2022 was
EUR925,134 (gross), down 12% compared with the previous quarter to
March 2022 (EUR1,046,485)
-- Peak electricity spot prices have levelled off when compared
to the extreme prices experienced in March when gross income
exceeded EUR500,000 in a single month
-- Gas price cap imposed by the Spanish Government from mid-June
has had a knock-on effect to electricity prices resulting in
reduced volatility and peak prices seen in the electricity spot
market
-- Electricity spot prices averaged more than EUR180/MWhr in the quarter to April to June 2022
-- Transition to full automation completed and since mid-March
2022 the power plant has been operating 24/7
-- The plant is at 30% capacity with potential to increase
output to up to 100% when infill wells are approved and drilled
successfully
-- Project Apollo, the installation of solar panels on the roof
of the El Romeral facility to power ancillary services is underway
and due to be fully commissioned in early August
-- Project Helios, the renewable co-generation via a proposed 5
MW solar farm adjacent to El Romeral is at FEED stage
-- Connection to the power grid at El Romeral is pre-existing
and the grid network has ample capacity to export increased
electricity output from the new photovoltaic generation, subject to
permitting
Further information - Generation
The high income from electricity generation at the plant has
been augmented by the ability of the plant to run 24-hour
operations, 7 days a week. The operational and subsurface technical
teams at Tarba have been working together closely to monitor the
performance of the plant and the gas production with input from
reservoir modelling. Electricity generation can be suspended if
needed when electricity pool prices drop below breakeven prices.
Tarba has cash in hand of more than EUR1,100,000. Gross electricity
sales revenue for the quarter ended 30 June 2022 was EUR925,134
(gross).
Further information - Project Apollo
Project Apollo will result in increased sales of electricity.
The cost of installation is less than EUR50,000 and has been
financed from existing funds held by Tarba. Payback from this
investment is estimated to be shorter than previously estimated at
approximately two and a half years on account of higher electricity
prices. A total of 83 photo-voltaic panels have been installed in
three separate zones on the power plant roof giving a total
installed peak capacity of 41.5 kWh. With the sunny climate of
Andalusia, this is expected to generate 66 MWh in the first year.
Energy generated from Project Apollo will feed the plant's
ancillary services thus covering part of the plant's electricity
demand during daylight hours allowing increased electricity
sales.
Mark Routh, Prospex's CEO, commented:
"El Romeral continues to generate very healthy revenues with
daily electricity spot prices averaging more than EUR180/MWhr in
the quarter to 30 June 2022. The gas price cap imposed by the
Spanish Government from mid-June has had a knock-on effect to
electricity prices. Since Tarba produces its own gas from the El
Romeral production concessions, it is not directly affected by the
gas price cap, but that cap has reduced the number of extremely
high within day prices and has limited the volatility and peak
electricity spot prices seen in the previous quarter.
"Tarba remains ready to increase its gas to power generation
capacity at El Romeral as soon as the permits to drill a portfolio
of infill wells on the El Romeral concessions are received.
Achieving 100% output capacity could be realised from the first two
infill wells. A further increase of the plant's generation capacity
by recommissioning the mothballed third generator would be possible
in parallel with the drilling programme.
"I am extremely pleased to report that the first of our
photovoltaic projects is about to be commissioned. Project Apollo
will cover part of the plant's ancillary electricity usage, thus
allowing increased income from the sale of power."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR") and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
* * ENDS * *
For further information visit www.prospex.energy or contact the
following:
Mark Routh Prospex Energy PLC Tel: +44 (0) 20
7236 1177
Ritchie Balmer Strand Hanson Limited Tel: +44 (0) 20
Rory Murphy 7409 3494
Andrew Monk (Corporate Broking) VSA Capital Limited Tel: +44 (0) 20
Andrew Raca/Alex Cabral (Corporate 3005 5000
Finance)
Colin Rowbury Novum Securities Tel: +44 (0) 20
Jon Belliss Limited 7399 9427
Susie Geliher St Brides Partners Tel: +44 (0) 20
Ana Ribeiro Limited 7236 1177
Notes
Prospex Energy PLC is an AIM quoted investment company focussed
on high impact onshore and shallow offshore European opportunities
with short timelines to production. The Company's strategy is to
acquire undervalued projects with multiple, tangible value trigger
points that can be realised within 12 months of acquisition and
then applying low-cost re-evaluation techniques to identify and
de-risk prospects. The Company will rapidly scale up gas production
in the short term to generate internal revenues that can then be
deployed to develop the asset base and increase production
further.
About El Romeral and Tarba
The El Romeral gas and power project in Spain, with gas
production wells supplying gas to an 8.1MW power plant near Carmona
in Southern Spain is owned and operated by Tarba. It is currently
operating at about 30% of its full capacity because Tarba is
waiting on permits to drill further infill wells on the concessions
to increase production. Prospex owns a 49.9% working interest in
the El Romeral project via Tarba. The remaining 51.1% working
interest is owned by Warrego Energy Limited (ASX:WGO). Tarba sells
electricity generated from the plant on the spot market in Spain.
The El Romeral licences comprise three contiguous production
concessions.
The updated Corporate Presentation for Q3-2022 is available on
the Company's website at
https://www.prospex.energy/home
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END
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