ADX Energy’s combined oil and gas average production rate jumped 2 per cent in the past financial quarter, rising to 324 barrels of oil equivalent per day (BOEPD) at a time of swelling global oil prices.
The quarter saw continued oil sales for the company with uninterrupted production from its Anshof-3 well test in Upper Austria and stable oil and gas production from its Zistersdorf & Gaiselberg fields in Vienna.
Management says the Anshof-3 well was shut-in during September after reaching the regulatory limit of 5000 tonnes of test production, amounting to some 36,000 barrels and exceeding its expectations.
The increased production rate combined with a strengthening oil price, due largely to the ongoing conflict in the Middle East, averaged $136.63 per barrel during the quarter and gave the company $3.3 million in sales revenue, up 2 per cent from the previous quarter.
Net hedging losses amounted to $109.124, resulting in a total revenue of $3.2 million, a 3 per cent drop when compared to the previous quarter.
ADX says it will reboot production at the Anshof-3 well following the drilling of the Anshof-2 well, which is scheduled for early in November. The installation of a permanent surface production facility is expected to be installed in January and commissioned the following month.
Anshof-2 will be followed by the Anshof-1 development well, which is pencilled in for drilling during next year’s second quarter and procurement and planning work is underway.
Last month, the company secured appraisal and development funding through the completion of the Anshof Investment Agreement with Austrian energy giant MND for past and long-lead drilling costs, receiving cash payments and work program funding for the Anshof-2 and Anshof-1 wells. As part of the agreement, MND will provide ADX with $19 million in firm and contingent funding to earn a 30 per cent economic interest in the Anshof oil development project.
At the end of last quarter, the company had $ 5.7 million in cash and had received $3.2 million in farmout funding for past costs and long lead items.
On the exploration front, ADX is maturing is portfolio in Upper Austria, Romania and Italy.
The company’s 807 billion cubic feet gas equivalent (BCFE) Austrian prospect Welchau achieved a major milestone last quarter when its drilling permit was approved by the regulator and a $600,000 boost was received from the Austrian Science Fund.
Following the completion of the Anshof Investment Agreement transaction, MND and ADX started finalising agreements for the former to fund a gas-focused exploration program over its AT-I licence in Austria. Pre-drill permitting began for one of three gas prospects in the AT-I license area, with environmental permits expected to be issued next month and drilling set to follow mid-next year.
The company says prospectivity in that area, along with the nearby AT-II license, has been assessed using artificial intelligence applied to 3D seismic data to identify and de-risk stratigraphic traps and it may provide large resource potential.
In Romania, ADX has a 49.2 per cent interest in Danube Petroleum, which holds the Iecea Mare production license and Parta exploration license. Management says it has been in talks with the regulator to secure options for license extension in both areas.
Shallow water exploration activities in the strait of Sicily in the company’s “d363C.R-.AX” licence are awaiting ministerial response to a submission regarding a new award process for gas exploration in the area. The licence already boasts five four-way dip anticline leads, all with a seismic amplitude anomaly that may indicate hydrocarbon presence.
The company has also been assessing the feasibility of its renewable energy projects at its Green H2 and Solar projects in the Vienna Basin and the oil and gas-stacked Geothermal project in Upper Austria, with dynamic energy markets and evolving European regulations controlling the landscape.
The price of crude oil has been modelled by the World Bank to hit $142 per barrel in this year’s fourth quarter, before dropping to an average of $128 per barrel during the next year – barring any escalation in Middle East conflict.
Under the World Bank’s worst case scenario – in terms of the conflict spreading – it has modelled a crude oil price as high as $248 per barrel.
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