Star Energy is pleased to provide the following trading update for the six month period to 30 June 2024. The figures have not been audited and are subject to change:
Key highlights:
· Net production average boepd of 2,012 for six months to 30 June 2024; with production on track to achieve our full year forecast of c. 2,000 boepd
· Forensic audit of G&A is underway, with a target to achieve savings of c.£1.5 million per annum that will take effect from 2025
· Cash at 30 June 2024 of £4.2 million and net debt of £1.9 million
· Progress being made on analysis of the technical data from all three secured licences in Croatia to rank the optimal sequencing of their commercial development
· Approvals received for the acquisition of magnetotelluric data across the Sjece and Pcelic geothermal licence blocks in Croatia. Data acquisition will commence imminently
· Seismic data acquisition and analysis for Salisbury hospital project to commence in Q3
Commenting, Ross Glover, Star Energy CEO said:
"My focus since becoming CEO has been twofold: to identify the best ways to optimise our oil and gas business in order to make it as capital efficient as possible; and, by delivering on this goal, generate cashflow that will enable us to build our geothermal business further, having refined and high-graded the opportunities it currently holds. There is much to be done to achieve these goals, but I am pleased to report that we are making progress.
Production remains robust as we focus on quick returning optimisation projects to yield incremental production and, in the longer term, reduce operational expenditure. The oil and gas business for now remains the driver of the Group cashflow and capitalising on near term production opportunities will be important for this.
We have committed to transitioning, over time, to a geothermal business, generating geothermal heat in the UK and power in Croatia. Cashflows from our oil and gas business to provide development funding are key to this transition, as are the skills of our workforce. We will, however, be rationing our capital allocation in this area until we have clarity on government support mechanisms in the UK and have force ranked our Croatian project opportunities.
The new UK Government have a clear mandate to build out clean energy and tackle climate change. The King's Speech set out the government's commitment to a clean energy transition, which aligns with our energy transition strategy. We are heartened by the positive moves to drive forward renewable energy deployment through the establishment of GB Energy and streamlining planning processes. We look forward to continuing positive engagement with this Government as we continue to deliver indigenous oil and gas whilst developing low carbon, geothermal heat for a net zero future.
I look forward to updating the market further and in more detail at our interim results in September."