RockRose Energy Plc’ management has taken action to reduce expenditures and now expects to participate in three wells this year rather than seven.
With a capital expenditure budget for 2020 cut by 40% since mid-March (USD 80 mill cut), the total expenditure for 2020 is now expected to be over $100 million lower than originally budgeted.
However, these deferrals are not expected to have a material impact on reserves.
This was stated in a notice to shareholders prior to the Annual General Meeting to be held later this morning.
RockRose is operator of the West Brae field in the Central North Sea (40% working interest) and the Cotton gas field in the Southern North Sea (100% interest since 2019).
UK output has averaged 14,900 barrels of oil equivalents per day (boepd) and Netherlands output has averaged 5,900 boepd.
The deferral of certain activity combined with recent well results means that the Company now expects average production in 2020 to be about 20,000 boepd rather than 21,000 boepd.
“Following a successful 2019, I am very pleased with the continued progress made by RockRose in the first quarter of 2020. Of course, the COVID-19 pandemic combined with low oil and gas prices have created a difficult environment and this is likely to persist for some months. However, the Company continues to deliver operationally and is well-placed to face these twin challenges thanks to its strong balance sheet and to the actions taken to reduce expenditure”, Andrew Austin, Executive Chairman of RockRose Energy, says.