Rockrose Energy (LON:RRE) have told shareholders that they are set to meet their 2019 production guidance in an optimistic update to shareholders.
RockRose Energy is an independent oil and gas production and infrastructure company.
A Rockrose is a plant that grows in harsh environments with minimal external support. Creating an energy company that is equipped to do business in the harsh environment of sub $50 oil with a minimal cost base was the strategy behind the establishment of Rockrose Energy in 2015.
The firm said that in 2019, a pro forma production was in line with guidance of roughly 19,200 barrels of oil equivalent per day.
Excluding shutdowns and other variables, annual pro forma production was about 20,500 boepd, with about 21,000 boepd produced in December.
Pro Forma production increased by 78%, the company noted as this included a contribution from Marathon Oil (NYSE:MRO).
Average production for 2020 is expected to be around 21,000 which shareholders will be thoroughly impressed with.
This figure reflects a 9.4% rise year on year, and this accounts for planned shutdowns including the Forties pipeline system in mid-June for three weeks.
The company has guided for a dividend of 25 pence per share, giving a total dividend of 85 pence across 2019.
Expenditure in 2019 was $80 million, which was below previous guidance. Another impressive stat for shareholders to be excited about.
For 2020, capital expenditure is guided at about $200 million – which the company said will lead to higher production.
At the year end, total cash was $370.7 million, of which $54.9 million is restricted. Cashflows have been underpinned by enhanced production following completion of the Marathon acquisition and the Company remains debt-free.
Comments
“RockRose is well placed to continue to offer substantial returns to shareholders. We delivered a strong increase in production in 2019, which resulted in significant cash generation. In turn, this enabled us to implement a regular dividend policy to return cash to investors while continuing to invest in projects designed to drive additional future returns,” Executive Chair Andrew Austin said.
Austin added: “We have a busy schedule in 2020, which will see organic growth in our production, and we continue to look at opportunities to deploy our balance sheet strength to make acquisitions that meet our criteria. We look forward to reporting on further progress as the year unfolds.”
North Sea Operations
Fellow operators in the North Sea have been busy as have Rockrose.
This morning, headlines hit that Premier Oil PLC (LON:PMO) have announced that they will be purchasing two North Sea assets from BP PLC (LON:BP).
Premier have said that they will be buying the Andrew Area and Shearwater assets from oil major BP for $625 million.
Andrew Area includes five fields which produce 18,000 barrels of oil equivalent per day. Shearwater in comparison accounts for 25 million barrels of oil equivalent of reserves.
Premier further updated shareholders by saying that it had taken a further 25% more of Tolmount off Dana Petroleum PLC (LON:DNX) for $191 million, and a potential $55 million more.
Although the North Sea exploration market is competitive, it seems that Rockrose are onto a winner here and the firm will hope that trading can continue to be strong across 2020
Shares in Rockrose trade at 1,920p. (+3.82%). 7/1/20 12:30BST.