By Scott Wright
WEST of Shetland oil pioneer Hurricane Energy has underlined its expectation of an “excellent performance” in 2023 following a “highly successful” 2022, which saw revenues boosted by high oil prices.
However, the company said there “can be no certainty” that ongoing moves to sell the company will lead to a deal being done, despite receiving “multiple proposals from credible counterparties”.
Hurricane has enjoyed a dramatic upturn in fortunes following the rise in commodity prices that followed Russia’s war on Ukraine but is currently trying to fend off moves by its biggest shareholder, Crystal Amber, to throw out its management team. The investor, which holds a 28.9 per cent stake in Hurricane, issued a requisition notice for a general meeting shortly before Christmas, seeking the removal of chairman Philip Wolfe, chief executive Antony Maris, and chief financial officer Richard Chaffe, as well as other directors to be replaced by its own nominees.
Crystal Amber said Hurricane, which has a 100 per cent interest in the oil-producing Lancaster field West of Shetland, would be “better served under new management”. But the company hit back, describing the move by the investor as “simply mystifying” given the “excellent traction” it has seen from the formal sale process. Hurricane put itself up for sale on November 2 after an unsolicited offer that it said undervalued the company.
Yesterday, Hurricane said it had received “multiple proposals from credible counterparties” for the company after asking for indicative proposals by January 7. But it said there “can be no certainty as to the level of any offers resulting from the FSP (formal sale process), if any.”
Hurricane said: “It should be noted that all of the proposals received were highly conditional and subject to further due diligence. In addition, each proposal contains a structured element requiring further clarification and assessment by Hurricane and its advisers.”
Hurricane reported yesterday revenue of $311 million for the year ended December 31, up from $241m in 2021. It ended the year with no debt, with net cash of $122m on December 31.
Mr Maris said: “2022 has been highly eventful and highly successful. Working closely alongside our FPSO (floating production storage and offloading) operator we have delivered superb uptime performance and produced towards the upper end of our annual production target.”
“The field has now produced more than 15 million barrels and, with our deep understanding of the depletion dynamics of the field, we expect to continue this excellent performance in 2023.”
“This strong performance coupled with oil prices has allowed us to finish the year with a robust balance sheet, no debt and fully funded decommissioning liabilities. This, together with our experienced, committed and capable team and profitable ongoing production, provides an excellent platform to create future value for shareholders.”
Hurricane said it expects to producer between 5,900 and 7,100 barrels of oil per day in 2023, having been producing around 7,800 bopd as of January 9.
The company said it will provide an update on the proposed requisition of a general meeting by Crystal Amber by close of business today (January 12).
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