Challenger Energy (CEG ) has provided Q1 oil production, sales, and revenue figures for its Trinidad and Tobago business unit today.
Production in Q1 was 358 barrels per day (bopd) or 32,183 for the quarter, hovering around 400 bopd near the end the quarter, and representing a 12% increase compared to Q1 2021. A week ago the company announced successful recompletion work undertaken in March and April 2022 that is largely to credit for the production increase. Further enhancements over the coming months are expected to result in another 10% increase.
Challenger delivered the increase despite grid supply issues in Trinidad and Tobago in February, causing facilities and equipment to go offline. The company has announced upcoming power infrastructure upgrades to mitigate against potential future blackouts, to complement aforementioned enhancements.
Sales figures for Q1 are up as well at a gross realised average price per sold barrel of $83.37 and a total of 29,727 barrels sold during the quarter. The average price reached $97.13 in March due to the substantial increase in global oil prices during the month.
Revenue in Q1 was $39.29 per barrel sold or a total of $1.17m. Again, net revenue rose in March by 17% to $46.20, reflecting the increase in global oil prices.
Challenger's Trinidad operations generated an unaudited pre-tax cash surplus of $0.2m in Q1. The figure takes into account all expenses except tax. However, due to large carry-forward tax losses in Trinidad and Tobago, the company is mostly shielded from corporate tax at the moment. Also, Challenger does not currently utilise any hedging instruments, thus it is receiving full gain of current prices.
Eytan Uliel, CEO, commented:
"This encouraging first quarter result reflects a renewed focus on routine operations, stringent cost control, and the committed efforts of everyone in the Challenger Energy team. I'd also note that both average production and realised prices achieved in the first quarter of 2022 are considerably below the levels we are seeing as we start the second quarter, where the Company is benefitting from continued strong oil prices globally and higher production. The increased and more stable base line production we are currently enjoying has been gained through a targeted work programme aimed at production enhancement, made possible due to the successful completion of our restructuring and recapitalisation in March 2022.
We have more production accretive work being planned for the coming quarters and I look forward to reporting on further improvements as the year progresses".
The news was well-received by investors this morning.
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