Ascent Resources Plc (LON:AST) Chief Executive Officer Colin Hutchinson caught up with DirectorsTalk to discuss the purchase of Trameta, what this means for Ascent, plans between now and first gas in 2017, details of the Joint Venture and optimism for their future
Q1: So Colin, you’ve just completed the purchase of Trameta which is the company that owns the access to a section of pipeline which is key to progressing the alternative route to first gas. What does this mean for Ascent Resources in the immediate future?
A1: I guess the immediate impact of the transaction completing is that we can know get on to the site here, get access to that pipeline and we’ve started doing some testing on the pipe to understand whether there’s any rectification work required to it so that that’s started today and we should have a good understanding in the next week or two on what exactly we need to do to the pipeline. That’s the first key step in the work programme that we’ll need to carry out to get first gas.
Q2: What are your plans between now and first gas in January 2017?
A2: There’s 2 key work streams, the first one essentially is to get to recomplete wells 10 and 11 and those wells need the plugs removed to be made ready for production. The other key work stream is that there’s a CPP gas separation station which needs to be refurbished so it can cope with a higher volume of gas, we’re actually putting in some new separators then the infrastructure needs to be tied together so we need to connect a couple of pipelines. So there’s not a huge amount that needs to be done, I guess the big task had been getting the legal agreements in place now we’re into the operational phase of things where things should run through fairly smoothly.
Q3: Can you give us a little bit of detail around the joint venture aspect of the gas production?
A3: The joint venture here involves an assembly of the 75% stake in it, the other 25% is held by a company that’s owned by Nafta Lendava, who are a state owned oil and gas company and Petrol, who are one of the largest companies in Slovenia, they’re listed on the stock market here and the range of energy businesses they own a lot of petrol forecourts and they’ve got some other renewables businesses, a variety of things but it’s good. Ascent Resources have got a government partner and we’ve got a sort of large Slovenian corporate working with us within the joint venture, I guess now we’ve also got INA who are the largest oil and gas company in Croatia as our offtake partner so it’s good to have them involved in the project as well now.
Q4: Now you’ve overcome some big hurdles over the last year, are you still optimistic for Ascent Resources’ future?
A4: Yes, we have, we’ve come through. The first part of the year was fairly interesting, we overcame the IPPC decision was a bit of a setback but it’s actually turned out to work in our favour I think because we’ve been able to push forward with this alternative route to market which should allow us to get into production much more cheaply and much more quickly than we would have been able to had we got the IPPC permitting and got pushed down the route of constructing our own gas processing facility. The future looks fairly bright now and we just need to complete these 2 work programmes and we should be in production early 2017 and hopefully we’ll have the well recompletions done the back end of 2016 and then we can start producing early 2017.
