Relentless

At

the

Focus

VAS

field,

proposed

planning

VED

new

area

prospect

well to

fo

has

within

explor

the

gas

continued,

the

VAS

network

processing

and

upgrad

underway

and

other

facilities,

Overall

flo

.

infrastructure

upward

production

continued

record

trend

its

levels

during the

approximately for the

year,

achiev

2019,

6

with

.

and

2020,

a

5%

higher

being

when

than

-

production

boost

in

.

the SV

54

in

Production

well

May

came on

The

average

daily

condensate

production

GOL

and

of

gas,

Enwell Energy plc Annual Report and Financial Statements for the year ended 31 December 2020

Contents

Strategic report

Highlights

02

Where We Operate

04

Our Marketplace - Ukraine

05

Chairman's Statement

06

Chief Executive's Statement

08

Focus for Growth

11

Business Model

12

Our Strategic Priorities

13

Statement Under S172(1)

Companies Act 2006

14

Overview of Assets

16

Overview of Reserves

19

Finance Review

20

COVID-19 Pandemic

22

Corporate Social Responsibility Overview

23

Principal Risks and Uncertainties

24

Governance

Board of Directors

32

Corporate Governance Statement

34

Directors' Report

37

Independent Auditors' Report

39

Financials

Consolidated Income Statement

45

Consolidated Statement of

Comprehensive Income

46

Company Statement of

Comprehensive Income

46

Consolidated Balance Sheet

47

Consolidated Statement of

Changes in Equity

48

Consolidated Cash Flow Statement

49

Company Balance Sheet

50

Company Statement of

Changes in Equity

51

Company Cash Flow Statement

52

Notes forming part of the financial

statements

53

Advisers

83

Glossary

84

We are an oil and gas business focused on careful, disciplined growth in our operations in Ukraine. Our success is founded on rigorous planning, careful use of cutting-edge technology, responsible resource stewardship, and a highly experienced team. Meet an energy business that's listening to its stakeholders.

Rigorous control of our production processes and costs

Operating

expenditure

per boe

$9.50

STRATEGIC REPORT

Capital structure to implement our near-term strategy

Cash year-end

$61

million

Reserves growth increase since 2013 by a factor of four

2P reserves

49

MMboe

01

Highlights

Production

Revenue

Cash generated from

operations

Up 6.5%

Down 15%

Down 4%

4,541boepd

$47.3m

$23.8m

(2019: 4,263 boepd)

(2019: $55.9 million)

(2019: $24.7 million)

Operational

  • Aggregate average daily production of 4,541 boepd (2019: 4,263 boepd), an increase of approximately 6.5%
  • SV-54development well successfully completed and brought on production in May 2020
  • Drilling of SV-25 appraisal well successfully completed and hooked up for production in Q1 2021
  • MEX-GOLand SV production licences each extended to 2040, enabling full economic development of remaining reserves
  • No operational disruption to the Group's operations linked to the COVID-19 pandemic

Financial

  • Revenue of $47.3 million (2019: $55.9 million), down 15% as a function of weakened gas prices in the year
  • Gross profit of $15.7 million (2019: $23.5 million), down 33%
  • Cash generated from operations of $23.8 million (2019: $24.7 million), remained steady, predominantly due to record production increasing non-cash DD&A
  • Net profit of $3.2 million (2019: $12.2 million)
  • Cash and cash equivalents were steady at $61.0 million at 31 December 2020 (2019: $62.5 million)
  • Average realised gas, condensate and LPG prices in Ukraine were lower, particularly gas prices, at $136/Mm3 (UAH3,618/Mm3), $46/bbl and $46/bbl respectively (2019: $219/Mm3 (UAH5,729/Mm3) gas, $58/bbl condensate and $55/bbl LPG)

02

Enwell Energy plc // Annual Report and Financial Statements 2020

Outlook

  • Development work planned for 2021 at the MEX-GOL and SV fields includes: completing drilling operations of the SV-29 well; planning for a further new well or sidetracking of an existing well in the SV field; and upgrading of the gas processing facilities
  • Development work planned for 2021 at the VAS field includes: planning for a new well to explore the VED prospect within the VAS licence area; and upgrading of the gas processing facilities
  • Development work planned for 2021 at the SC field includes: planning for the drilling of the SVIST-4 well; and acquisition of 150 km2 of 3D seismic
  • 2021 development programme expected to be funded from existing cash resources and operational cash flow

Why we have a strong future:

  • We see a growth market ahead in Ukraine as domestic demand expands
  • We have a significant reserves base
  • We aim for a production to reserves ratio of 7% (currently at 3%)
  • We apply our skills and technology to enable us to produce at low cost
  • We place great emphasis on safety and environmental awareness, and we design our processes to achieve accident-free operations
  • We have no debt and sufficient funding resources and contingency plans to deliver our near-term plans
  • We apply rigorous selection criteria when investigating new business opportunities

STRATEGIC REPORT

03

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Enwell Energy plc published this content on 21 May 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 May 2021 07:14:06 UTC.