Business
Operational Review Update
Operational Review Update.
About this update from Cadogan Energy Solutions Plc
[{"type":"text","content":"\n RNS Number : 3532K Cadogan Petroleum PLC 18 December 2008 \n \n18 December 2008\n\nCadogan Petroleum\n\nOperational Review Update\n\nThe Board of Cadogan Petroleum plc ('Cadogan' or the 'Company') today provides an update on its operational review, which we announced in our Interim Management Statement on 19 November.\n\nINTRODUCTION\n\nSince the Company's IPO in June 2008, Cadogan has continued to invest in the appraisal and development of its assets in Ukraine. For various operational reasons, first production from Pirkovskoe and Zagoryanska is not now expected until Q1 2009. In view of this deferral of revenue, and taking account of future production risks and external factors, the Board has undertaken a review of the Company's planned operations to ensure that it retains appropriate financial headroom going forward. Under the revised operational plan, the Company remains able to finance itself independently during 2009 and 2010, by which time it expects to be generating significant revenues from production. \n\nThe objective of the revised operational plan is to focus the Company's available resources in the most cost efficient manner on those assets which are most likely to produce near term cash flow benefits, with the longer term objective of adjusting the capital expenditure profile to be consistent with internal cash flow generation. In this way we are confident of our ability maintain a viable stand-alone funding strategy. As a result of these measures, the Board is confident that we will maintain a positive net cash position for the foreseeable future, with the near-term low point of in excess of $20 million expected in September 2009.\n\nCadogan's revised operational plan incorporates the following key components:\n\n\ncomplete a total of 8 exploration and development wells in 2009 and 2010;\n\n\ninvest some $76.2million (£50.8 million) in capital expenditure in 2009 and some $56.7 million (£37.8 million) in 2010 thereby deferring some $179.0 million (£119.3 million) of capital expenditure in total over those two years ;\n\n\nmonthly ...