Page 18 - LatAmOil Week 21 2020

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NEWS IN BRIEF
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Each is equipped with electrical driven cargo pumps for enhanced fuel efficiency, high power thrusters and are fully capable of operating in weather conditions expected for their class.
On taking delivery, AET President & CEO Rajalingam Subramanian said: “Constructing and delivering Eagle Petrolina safely amid the COVID-19 outbreak is a big accomplishment and testament to the commitment of all parties involved. I would like to thank everyone from Samsung Heavy Industries, Eaglestar, DNV-GL, Petrobras and AET for the excellent collaboura- tion and management to deliver this milestone. The safe delivery of Eagle Petrolina is a prime tes- tament of such collabouration showcasing what can be achieved when everyone works together to be part of a solution.
“For AET, seeing the agreement we reached with Petrobras two years ago now coming into operation is another important step in grow- ing our specialist DP activities in the Brazilian Basin and our partnership with Petrobras. The Eagle Petrolina further demonstrates our contin- ued commitment to high-quality, safe and eco responsible operations. As a second generation DPST, she is more environmentally-friendly than current average DPST assets operating in the Brazilian basin.”
AET currently operates seven DP shuttle tankers (including Eagle Petrolina) and has a further 10 shuttle tankers under construction to be delivered between 2020 and 2022.
AET, May 26 2020
PERORMANCE
Maha Energy updates
production guidance and
capital plan for 2020
Due to the effects of the COVID-19 pandemic currently sweeping across Brazil, Maha Energy has reduced its average annual production guid- ance from 5,000-5,500 boepd to 4,000-5,000 boepd.
“The COVID-19 pandemic is now taking a toll on our operations. The domino effect of bor- der closures, deliveries of vital equipment and services and lower end user gas demand, to name a few, has required us to revise our 2020 produc- tion guidance. These factors, which are outside our control, have indirectly led to an unforeseen reduction in oil production. At this time, we continue to be uncertain on the future impact of COVID-19 to our production volumes, but like most companies we are working hard to offset the reduction in production volumes with a corresponding reduction in expenditures. At current oil prices, the Company’s financial
condition is robust and we expect to continue to fulfill all our future financial obligations, including the full repayment of the SEK 300mn bond next year, despite the production guidance reduction,” stated Jonas Lindvall, CEO of Maha Energy AB.
Natural gas is a by-product of the produced oil, and if the gas cannot be disposed of, the oil production must be curtailed accordingly. The Brazilian Government has granted a tempo- rary flaring easement to ensure continuous oil production during the COVID-19 pandemic, which is reducing the impact of the curtailment. And even though the Tie oil processing plant is capable of handling oil and gas mixtures of up to 4,850 bpd, the plant is not designed to flare 100% of the liberated gas on a continuous basis.
As a result of the annual average production guidance revision, the Company continues to revise and optimise its 2020 Capital Plan. The previously announced reduction in the Capital Plan for 2020 has now been amended to include rephasing of the Tie wells (TS-1 & TS-2) and the inclusion of a new Compression Project at Tie along with some work on the newly acquired Illinois Basin assets.
Total capital expenditures for 2020 is now estimated at $15.5mn, down 25% from the orig- inal $20.7mn.
Maha Energy, May 22 2020
FINANCE
Touchstone enters into
escrow arrangements for
$20mn term loan
Touchstone Exploration announces that its indirect wholly-owned subsidiary, Touchstone Exploration (Trinidad) Ltd, has entered into escrow arrangements for a $20mn, seven-year term loan agreement with Republic Bank as ini- tial lender, arranger and administrative agent. The Term Loan was arranged exclusively by the
Corporate and Investment Banking Division of Republic Bank.
The Term Loan is expected to become effec- tive prior to June 15, 2020, once all conditions precedent have been met, which include the completion of security interest filings in Trini- dad and Barbados and the receipt of regulatory approvals in Trinidad. A portion of the Term Loan proceeds will be used to repay the Compa- ny’s CAD20mn existing credit facility, with the remainder used for general corporate purposes.
Scott Budau, Chief Financial Officer, com- mented: “We are pleased to be able to source local financing from Republic Bank, the largest lender in Trinidad and the Caribbean. The finan- cial flexibility of the new facility will us allow to confidently proceed with our Ortoire explora- tion activities. In addition, the interest payable on the loan is expected to be tax deductible in Trinidad, equating to an after-tax cost of capital of 3.5%. We would also like to give our sincere thanks to Crown Capital, who has supported us since 2012.”
Prior to the effective date of the Term Loan, Touchstone continues to operate under its exist- ing CAD20mn credit facility. In connection with the existing credit facility, the Company granted the lender a production payment equal to 1.33% of petroleum sales from Trinidad land holdings, payable quarterly through October 31, 2021. The parties have agreed not to buyout the pro- duction payment obligation and as such have entered into an amended production payment agreement to continue the obligation under the previous terms and conditions. The total pay- out of the existing credit facility will include the CAD20mn principal balance, all accrued inter- est thereon, and a 1.0% prepayment fee.
Touchstone Exploration Inc. is a Calgary based company engaged in the business of acquiring interests in petroleum and natural gas rights and the exploration, development, production and sale of petroleum and natural gas. Touchstone is currently active in onshore properties located in the Republic of Trinidad and Tobago.
Touchstone Exploration, May 27 2020
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Week 21 28•May•2020