Hydrocarbon exploration and production company JKX Oil & Gas PLC reported on September 21, 2016, that preliminary results show revenue down 19.5% for the year to date and that it is continuing to cut jobs across its operations.
In Ukraine, it identifies a technical solution to potentially unlock approximately 600 bln ft³ of recoverable gas reserves previously considered uneconomic at the Rudenkivske gas field. The field is estimated to have 2.8 trillion ft³ gas in place.
Its FDP calls for 135 wells to be drilled over 10 years, resulting in plateau production of 110 mln ft³/d (18,300 barrels of oil equivalent per day) but requiring $660 mln of capital investment. But full field development would require the use of modern equipment and services not currently available in Ukraine. Further reform of Ukraine's upstream incentives, in particular by reducing royalty rates, would spur full field development, JKX added.
JKX adds that its Russian FDP covers the Koshekhablskoye gas field and is based on a new reservoir audit by DeGolyer & MacNaughton. This gives a total proven plus probable mid-2016 reserve figure net to JKX of 85.5mn boe, up from a previous end-2014 figure of 64 mln boe. However, the proven reserve component included in those figures has declined to 46.5mn boe (from 53.4 mln boe).
The company said its overall production for the year to August 31 was up 17.5% at 10,271 boe/d, including a 38% increase in Russian gas production, but overall revenue was 19.5% lower than in the first 8 months of 2015.
JKX expects the outcome of an international arbitration tribunal on its claim against Ukraine by the end of this year, relating to overpayment of some $180 mln. Separate unrelated legal claims in Ukraine remain ongoing. Meanwhile it says it is cooperating with a police investigation there, following police raids in Poltava in June 2016.
The firm has notified both UK and US embassies in Kiev and continues to «vigorously contest» the validity of claims made.