President Energy Announces Operational update at Puesto Flores

President Energy (AIM: PPC), the upstream oil and gas company with a diverse portfolio of production and exploration assets focused primarily in Argentina, provides an update on its operations at its Puesto Flores Field, Rio Negro Province, Argentina.

Highlights:
- The Company is expected to receive in November over US$3 million net cash proceeds from its Argentine oil sales
- Fully funded workover programme at Puesto Flores Field commences and is increased to four firm wells
- Further wells to be considered next year
- Pay-back of the US$2.2 million capex, projected to be less than 12 months at the conservative October oil price level of US$55 per barrel oil

Peter Levine, Chairman and Chief Executive, commented:
“With record net cash proceeds from Argentine sales receivable in November and the commencement of an increased firm workover programme at Puesto Flores Field, we are looking ahead and focused on continuing the trajectory of profitable growth in the new year whilst maintaining the core emphasis on margins.”

US$3 million net cash oil receipts
The Company is to receive in November over US$3 million net cash proceeds from its oil sales after deduction of sales tax payable. The expected receipts relate to oil produced partly in October and partly in the current month from President's Argentine Fields. The proceeds do not correlate to daily production for a month as not all production generated on a daily basis is sold within that month with oil being held in tanks, being treated or in process of transport through long pipelines. The receivables from the Company’s profitable cash generative production interests in Louisiana are in addition to the above.

Workover programme commences
The Company previously announced a three firm well workover programme expected to commence this month. After a satisfactory rig inspection, this work is now commencing and has been extended to an initial four firm (definite) wells with further possible contingent wells next year as may be deemed appropriate after results of the initial programme are considered.

All of the four firm wells are currently shut-in and the objective is to place them back into production, generating oil from the intervals originally perforated when the wells first came into production. In addition, in three of the wells, a series of previously un-drained intervals interpreted from the original drilling logs as oil bearing will be perforated and if successful will be produced in parallel. The total firm programme is expected to cost approximately US$2.2 million and will be funded out of President's existing resources. Pay-back, ignoring any incremental production from new intervals, is projected to be less than 12 months at the October level of US$55 per barrel oil.

Each of the wells have individual downhole electrical submersible pumps run through mains electricity and are already connected with the Puesto Flores battery meaning there will be no delay on placing each on production as and when work on each such well is completed. Taking into account the additional firm well, the commenced programme is expected to extend through January 2018 and President will report to shareholders on progress at appropriate times during the course of the work.

In line with President's policy to retain local Rio Negro Province contractors and workforce wherever practical, the rig to be used in the programme has been provided by Tacker, a well-regarded local services company.