In a news release, Pan Orient Energy Corp. (POE:TSX.V) announced that it experienced solid growth of its Thailand reserves and strong oil production in 2019.
"We anticipate this to continue through 2020 despite the current low oil price environment," President and CEO Jeff Chisholm said in the release.
"With a very strong balance sheet, an active 2020 drilling program funded entirely through after tax cash flow from low cost high netback onshore Thailand Production, the company possesses the financial and operational strength to withstand and grow in an environment of low oil prices and take advantage of any opportunities that may present themselves during this challenging time," Chisholm stated.
Pan Orient started 2020 in a strong financial position with $32.7 million in working capital and deposits in Canada and Thailand. Thailand oil production is expected to fund the 2020 capital program, even at current oil prices.
Looking back at Pan Orient's operations in 2019, at the Thailand concession, two new producing wells came online at the L53-DD field: L53-DD3 and L53-DD4. Production began from the new L53-B1 appraisal well. Discovery was made of the L53-AA South field with the L53-DD5ST1 exploration well. These four wells contributed 447 barrels of oil per day to average oil sales last year.
Net to Pan Orient's 50.01% equity interest, Proven and Probable crude oil reserves grew 34% in 2019 to 1.8 million barrels. Their net present value (NPV) increased 11% to $43.7 million.
Operating expenses in 2019 were 55% lower than in 2018, averaging $6.16 per barrel.
In Indonesia, following drilling of the Anggun-1X exploration well in Q4/19, Pan Orient withdrew from operations in that country.
As for the Sawn Lake asset in Canada, upon evaluation in 2019 with a steam assisted gravity drainage of the oil sands, they were given an 85% chance of development and risked best estimate contingent resources were calculated at 139 million barrels of bitumen recoverable net to Pan Orient's 71.8% interest in Andora, the owner and operator. The risked best estimate of after-tax NPV for Pan Orient's interest was $143 million.
On a corporate level, Pan Orient experienced a loss in 2019 of $25.3 million, or $0.46 per share. The loss in Q4/19 alone was $26.9 million, or $0.49 per share, due to a net $27 million impairment charge for the East Jabung exploration and evaluation assets.
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