i3 Energy PLC Announces Final Results for the Year Ended 31 December 2023
*EASTLEIGH, UNITED KINGDOM / ACCESSWIRE / April 29, 2024 / *i3 Energy plc (AIM:I3E)(TSX:ITE), an independent oil and gas company with assets and operations in the UK and Canada, is pleased to announce the audited results for the year ended 31 December 2023. A copy of the Company's financial statements will be made available shortly on the Company's website at https://i3.energy as well as filed under the Company's profile on SEDAR+ at www.sedarplus.ca and will be posted to those shareholders who make or have made a request to receive a paper copy. The Annual General Meeting ("AGM") will be held at 11:00 am BST on 27^th June 2024 at the offices of WH Ireland Limited at 24 Martin Lane, London, EC4R 0DR.
*CANADA*
*UK AND CORPORATE*
Average daily production (BOE/d)
2023: 20,711
2022: 20,317
2021: 12,442
2020: 8,732
Group Revenue (£m)
2023: 146.3
2022: 208.4
2021: 86.8
2020: 13.0
2P reserves (MMBOE)
2023: 179.9
2022: 181.5
2021: 154.1
2020: 54
Group Profit after tax (£m)
2023: 15.1
2022: 42.0
2021: 25.1
2020: 11.7
PDP reserves (MMBOE)
2023: 47.1
2022: 49.1
2021: 46.2
2020: 18.1
Group NOI (£m) ^(1)
2023: 74.5
2022: 131.7
2021: 48.6
2020: 4.9
2P reserves Before-tax NPV 10 (USDm)
2023: 1,026
2022: 1,162
2021: 775
2020: 183
Group Adjusted EBITDA (£m) ^(1)
2023: 67.8
2022: 98.0
2021: 30.2
2020: (0.8)
Dividends declared (£m)
2023: 13.3
2022: 17.4
2021: 3.4
2020: 0
(1) Non-IFRS measure. Refer to Appendix B
*ACHIEVEMENTS IN 2023*
*Record Annual Production*
· Record annual production of 20,711 barrels of oil equivalent per day ("boepd"), at the high end of the Company's 2023 guidance range of 20,000 to 21,000 boepd and 2% above 2022 production.
· Record production achieved despite loss of approximately 3,100 boepd in Q2 due to restrictions associated with the Alberta wildfires, unanticipated apportionment issues associated with the Pembina Peace Pipeline liquids line, debottlenecking projects and twenty scheduled operated turnarounds.
*Shareholder Return*
· Total dividends of £13.298 million declared and £15.338 million paid in 2023.
*Capital Programme*
· £23.2 million capital expenditure in 2023 delivered 12 gross (8.0 net) wells, which were completed on budget in a high inflationary environment.
*Debt Re-financing*
· Successfully completed a CAD 100 million, 3-year, first lien Debt Facility with Trafigura Canada Ltd. (a subsidiary of Trafigura Pte Ltd.) and redeemed the H1 2019 Loan Notes in full.
*Reserves Replacement*
· Managed to maintain Proven ("1P") and Proven plus Probable ("2P") reserves essentially flat, despite a significantly lower capital programme in 2023 relative to the prior year, with a very healthy 2P reserves life index of 23.0 years.
· The Group now has over 390 gross booked drilling locations in its audited reserves and over 950 including un-booked locations.
*Extensive Planned Maintenance Programme Executed*
· Scheduled turnaround programmes successfully completed on 20 operated facilities, on-time and on-budget.
*ESG Performance*
· Completed the electrification of 25 pumpjacks in Carmangay and Retlaw to reduce use of diesel and propane for power generation, with a further two electrifications underway, which will eliminate 4,268 tonnes of CO2 ("tCO2") emissions annually.
· Completed electrification of two natural gas generators, resulting in an annual emission reduction of 907 tCO2 equivalent ("tCO2e").
· In 2023, we replaced 295 gas driven pneumatic pumps with solar powered pumps, which is expected to eliminate 8,971 tCO2 emissions annually.
· Launched an alternative Fugitive Emissions Management Programme, utilising airborne methane imaging technology which is expected to reduce fugitive methane emissions by 50% relative to 2022.
· Converted high-pressure natural gas driven pneumatics to compressed instrument air at three of i3's locations to reduce methane emissions equal to over 660 tCO2e annually.
· Ongoing annual abandonment and reclamation programme abandoned 46 wells, 26 pipelines and decommissioned 16 well sites, representing approximately 12% of operated non-producing wells.
*OUTLOOK*
A summary of key events which occurred after the reporting period are presented in note 24 to the financial statements. The Company's focus for the remainder of 2024 will be on three key areas:
1. The growth of i3's Canadian business through the deployment of capital into its large proven undeveloped reserves base, operational excellence to improve uptime and field performance, and strategic upsizing and/or repositioning of its core areas through M&A;
2. Maintaining flexibility to adapt to economic developments while maximizing total shareholder return; and
3. Conducting its operations safely and in an environmentally secure manner.
The Company continuously evaluates opportunities to strengthen its balance sheet whilst maintaining tight control of its costs and working capital position.
*Majid Shafiq, CEO of i3 Energy plc, commented:*
"i3 entered 2023 with strong momentum following a very successful Q4 drilling campaign in 2022, proceeding to drill and tie-in 8 wells in our Wapiti, Central Alberta and Clearwater acreage before the Spring break up period last March. However, as became common for 2023, the market was hit by volatile commodity prices, and, alongside natural disasters like the Alberta wildfires, and planned turnarounds and debottlenecking projects, i3 moved quickly to revaluate its capital programme and protect its balance sheet. We proceeded to focus on low-risk wells in our core production assets and appraisal wells in the Clearwater and are very pleased with the results, which were delivered on budget even in an inflationary cost environment. Despite these challenges and due to our ability to adapt our portfolio and investment and drilling strategy quickly, i3 achieved record annual average production of 20,711 boepd. This is a testament to the quality of our low decline production base, our low-risk drilling inventory and the skills and dedication of our employees.
As reported post-period end, i3's 2023 audited reserves report showed little change in 1P and 2P reserves, reflecting successful operational management and the quality of the Company's portfolio, and was achieved despite the mid-year change in capital budget and programme. With more than 390 booked (gross) drilling locations, i3's reserves report exhibits a strong and diverse asset base which can support growth through the business and commodity cycles, and we look forward to advancing our growth initiatives in the near term.
Financially, i3 was well funded in 2023, supported by the negotiation of a new CAD 100 million facility with Trafigura early in the year, and the settlement of our outstanding £22 million Loan Notes. Post-period, the Company has since established a CAD 75 million non-amortising credit facility with the National Bank of Canada, which allowed the Company to repay the Trafigura loan facility. i3 has benefitted greatly from building a strong relationship with Trafigura, a sophisticated oil and gas trader, but with the Company's focus on Canadian growth, recognised the significance of having a Canadian bank support us in country. Also post-period, the Company sold its non-core royalty production for circa USD 25mm at a cashflow multiple far in excess of the Company's trading value, which combined with the new credit facility has significantly strengthened our balance sheet and provides financial flexibility to manage fluctuating market conditions.
i3 was pleased to return £15.338 million in dividends to investors in 2023 and remains committed to delivering shareholder value via cash returns and growth. Management continuously weighs the expected returns generated through organic portfolio development against potential acquisition opportunities, which we continue to actively evaluate.
The Company looks forward to 2024 and beyond in a much-strengthened financial position, with a strong balance sheet, and growing relationships with providers of debt capital for growth. Our core asset base continues to perform consistently well and will underpin the development of the significant undeveloped reserve and resource potential in our portfolio. We look forward to executing a successful drilling programme in Canada in 2024, in what we believe will be a more positive pricing environment, growing production and continuing to return cash to shareholders to deliver on our total shareholder return model."
*Qualified Person's Statement*
In accordance with the AIM Note for Mining and Oil and Gas Companies, i3 discloses that Majid Shafiq is the qualified person who has reviewed the technical information contained in this document. He has a Master's Degree in Petroleum Engineering from Heriot-Watt University and is a member of the Society of Petroleum Engineers. Majid Shafiq consents to the inclusion of the information in the form and context in which it appears.
*Enquiries:*
*i3 Energy plc*
Majid Shafiq (CEO)
c/o Camarco
Tel: +44 (0) 203 757 4980
*WH Ireland Limited (Nomad and Joint Broker)*
James Joyce,Darshan Patel, Isaac Hooper
Tel: +44 (0) 207 220 1666
*Tennyson Securities (Joint Broker)*
Peter Krens
Tel: +44 (0) 207 186 9030
*Stifel Nicolaus Europe Limited (Joint Broker)*
Ashton Clanfield, Callum Stewart
Tel: +44 (0) 20 7710 7600
*Camarco*
Andrew Turner, Violet Wilson, Sam Morris
Tel: +44 (0) 203 757 4980
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*SOURCE:* i3 Energy PLC
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