Q4 2017 operations update and 2018 outlook victoria oil and gas gas prices going up in michigan

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* After reaching a cost recovery milestone on Logbaba during Q2 2016, GDC received 60% of revenue from Logbaba in accordance with its participating interest. electricity edison Prior to this date GDC received 100% of revenues as a recovery of exploration costs. m gasol In June 2017, Société Nationale des Hydrocarbures (“SNH”) executed its right to a 5% participation in Logbaba resulting in GDC’s participating interest decreasing to 57% and the figures from the effective date onwards have been adjusted accordingly.

La-107 is now a production well and a well plan is being finalised on La-108 to complete the clean-up and testing of the Lower Logbaba Sands. electricity laws in pakistan This includes recovery of the spent perforation gun. k electric bill Once this is done, the Upper Logbaba Sands in La-108 can be tested, if required, as gas flows from the Lower Logbaba Sands were ahead of expectations. Preliminary internal reserve estimates for La-107 and La-108 based on well logs and flow tests are material and will be published in due course.

The final cost of the well programme was $87 million against an original budget of $40 million. gas smoker ribs This overrun was the result of a combination of many factors and a detailed analysis will be completed. electricity in costa rica However, the well control event during the drilling of La-108 was the main cause of the delay and cost overruns. electricity examples An insurance claim has been lodged with the Company’s insurers to cover the substantial and material costs associated with this event and the consequential schedule and cost overrun. As is normal in these situations, the outcome of our claim is not certain.

Unaudited net revenue for Q4 was $4.4 million (Q4 2016: $4.6 million) and unaudited net revenue for 2017 was $23.9 million (2016: $32.8 million). The loss of revenue from ENEO, which accounted for approximately 53% of the Projects revenue in 2017, should a resolution with the parties involved not be found, would be significant for the Group in 2018.

GDC is the single onshore gas supplier in Cameroon; management estimates that with Logbaba and Matanda, GDC has potentially recoverable gas of at least 1.3 TCF and 50km of gas pipeline and support infrastructure to deliver gas to customers. GDC has a diverse customer base and whilst ENEO is our largest customer, we are connected to over 30 customer sites and believe that there is considerable expansion potential in Douala.

The Company is still in discussions with current and potential power providers Dibamba Power Development Company (“DPDC”) and Grenor S.A. (“Grenor”) aimed at concluding gas supply contracts with these companies for future grid power. Given the current environment, it is prudent to expect delays to the roll-out of investment into power generation, and therefore the Company has adopted a strategy of less reliance on grid power customers.

Management is expediting its support to manufacturers and producers in Douala, which are facing regular power disruptions, by providing bespoke gas fired power generation for individual customers or groups of customers. As most of these proposed power customers are already connected to the gas pipeline network, adding a gas to power generation solution will increase gas consumption with minimal additional capital costs for GDC. Furthermore, we are actively pursuing a Compressed Natural Gas (CNG) solution which will afford GDC the opportunity to reach some larger customers beyond the current pipeline infrastructure.

Ahmet Dik, CEO said, “Annual gross production figures for 2017 were a record for the Company, with 3.65 BCF of gas sold compared to 3.56 BCF in 2016. We estimate a considerable gross reserve base 200 BCF (2P) at Logbaba and over 1.3TCF of unrisked gas in place in the onshore Matanda, which the Company intends to develop following Government approval. electricity was invented We successfully completed two production wells and secured over $23 million of new financing via a share placing.