Ophir’s 1H Loss Reduced to $19.4 Million

Ophir Energy today announced that for the period ended 30 June 2013 the Group recorded a loss of US$19.4 million compared to US$24.4 million loss recorded in the same period last year.

No dividends were paid or declared by the Group during the period. The loss is a direct result of exploration expenditure, regulatory and corporate costs associated with operating the Ophir Energy group and its assets.

In the first half of the year the Group added over 3 TCF of gross recoverable resource to its core position in Tanzania over Blocks 1, 3 and 4 whilst derisking the commerciality of those assets with strong flow tests on the Jodari and Mzia discoveries. The ability to execute and deliver the planned exploration programme over the next 18 months was enhanced by the Placing and Rights Issue completed in March 2013 which raised US$837.6million (£553.4 million) and the extension to the drilling contract for the Deepsea Metro I drillship. Three new directors have been added to the Board, deepening the oil and gas industry expertise the Group can draw on.

Key highlights:

• Increased 2C recoverable resources across Tanzania Blocks 1, 3 and 4 to 15 TCF (2,500mmboe) following further successful exploration and appraisal drilling. Completed Drill Stem Tests (“DST”) at Jodari-1 (Block 1) and Mzia-2 (Block 1), confirming good reservoir deliverability and flow rates to the upper end of the expected range
• Executed successful ongoing drilling programme in Tanzania with exploration success at Ngisi-1 (Block 4), providing valuable appraisal of Chewa gas field
• Strengthened the company’s financial position by raising US$837.6million (£553.4 million) via the successful March Placing and Rights Issue
• Extended the contract for the Deepsea Metro I drillship with partner BG Group plc for a period of at least 18 months for the continuation of the 2013-2014 East African offshore drilling programme
• Made significant progress on Tanzanian LNG project  – site selection for a multi train LNG facility progressing towards a second half 2013 announcement
• Engagement with the Government of Tanzania on Block 7 gas terms
• Achieved ‘In principle agreement’ with the Government of Equatorial Guinea to review commercialisation routes for Block R gas including Floating LNG.

Commenting today, Nicholas Smith, Chairman, said:

“In the first half of 2013 we have maintained our 100% success rate in drilling on Blocks 1, 3 and 4 in Tanzania leading to an increase in recoverable resource to 15TCF (2,500mmboe). The results of the drilling campaign, coupled with the strong flow tests at Jodari and Mzia, have allowed us to progress pre-planning for the LNG development with increased confidence. The equity raise in March combined with our ability to secure a rig under long-term contract for the East Africa drilling campaign means we are well positioned to continue to deliver for our shareholders over the next 12 months.”