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I almost feel sorry for LGO Energy (LGO) CEO Neil Ritson. He just seems to have rotten luck. This time last year a contractor dropped some kit down a bore hole. Wind on 12 months and Hurricane Matthew has caused a few "problemos". Neil, put a few extra quid in the collection box this Sunday, you need the Almighty back on side for today's third quarter update is piss poor and begs the statement "placing ahoy."
The Group's third quarter 2016 production was an average of 526 barrels of oil per day ("bopd"). A total of 48,358 barrels were produced during the quarter; 38,354 barrels at Goudron, 1,232 barrels at Icacos and the balance of 8,772 barrels in Spain, all net to LGO's interest. Production in Trinidad was materially affected by a number of electrical power outages in the field caused by seasonal storm activity including Tropical Storm Matthew.
Underlying production, corrected for these seasonal variations, was flat quarter to quarter. The work-over activities carried out by the Company as previously announced fully counteracted declines in the base production at Goudron and, during October, production has risen as those wells have cleaned up and continued to perform strongly.
So having made great play of how LGO is reworking and bringing onstream wells in Trinidad at a cost of millions of dollars, output in Q3 was actually lower than in Q1 (574 bopd). As fast as new wells come onstream (at a material cost in capex) old ones decline. That is the LGO story.
The company might just hope to get back to Q1 levels in Q4. But that will still leave it burning cash (after capex) and still having to refinance the last $2.6 million owed to the froggie banksters at BNP Paribas - debt which is on call.
LGO's last placing of c£750,000 net was in late September at 0.1p. I am afraid this money will not be lasting long and so the only questions now are when will the hat be passed around yet again and at what price? Late November and 0.05p?
A third question is how long it takes our in-house BB loon Wildes to post a comment saying "its old the oil price, you've just got a vendetta against Big Dave Lenigas, FYB with LGO, I did at 0.19p and am a genius who always makes money, you tipped Teathers Financial & support President Putin and Donald Trump yadda yadda yadda"
Never miss a story.
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