Shares in Parkmead Group have shot up nearly 20% after the Aberdeen-based energy firm announced a new onshore gas discovery in the Netherlands.
The Alternative Investment Market stock soared to 62.9p at one point this morning, compared with 52.6p at Wednesday’s market close.
But by end of day the shares had retreated to 56.3p.
We expect first gas to be onstream within the first quarter of this year.”
Tom Cross, executive chairman, Parkmead Group.
Parkmead said the successful well, LDS-01,was ready for tie-in to production once drilling at another site is complete.
LDS-01 is the first of a two-well drilling campaign targeting several onshore gas prospects.
Drilling was done to a depth of around 7,300ft, with gas encountered at “multiple intervals”.
‘Immediate’ net production and cash
Parkmead executive chairman Tom Cross said: “The immediate proximity to production infrastructure allows for an extremely short tie-in period, and we expect first gas to be onstream within the first quarter of this year.
“This will provide Parkmead with immediate net production and cashflow.”
Parkmead said the discovery “significantly de-risks” follow-on prospects targeted by the second well, LDS-02, on the Drenthe VI concession.
The company also hailed it as another example of its Dutch assets continuing to deliver new discoveries to boost production from “this prolific onshore region”.
It added: “Parkmead’s existing onshore gas fields are performing exceptionally well, with very low operating costs of less than $9 per barrel equivalent due to astute financial and operational discipline.”
Drenthe VI contains the large Diever West gasfield in the north-east Netherlands.
Mr Cross founded and led Aberdeen-based Dana Petroleum until just after its £1.67 billion buyout by South Korea’s national oil company in 2010.
He collected more than £34 million from the sale of his stake, earning a reputation for being the North Sea’s “man with the Midas touch”.
© SYSTEMThe entrepreneur once described Parkmead, where he has been on the board since 2006, taking over as executive chairman in 2010, as “Dana Mach 2 but stronger”.
Parkmead, which is based in offices on Queen’s Terrace, now produces gas from four fields in the Netherlands.
The firm holds oil and gas interests spanning 26 exploration and production blocks.
Its UK North Sea interests include the Greater Perth Area, while it also has onshore renewable energy assets within its portfolio.
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