In light of current market conditions, and in order to continue to maintain the Company's strong balance sheet in these uncertain times, Jadestone is reviewing its 2020 capital programme. In the absence of the receipt of Vietnamese Government approvals of the field development plan ('FDP') for the Nam Du and U Minh gas field developments, Jadestone has decided to delay this project. Jadestone will remove substantially all capital spending which had been planned for the project in 2020, resulting in a 50%, or circa US$90mm reduction to its 2020 capex guidance for the year, which is now expected to be
This decision is not just a recognition of the impact of new measures to conserve the Company's capital resources, but focuses on the largest and longest element of the Company's 2020 capital programme, and one which would not have contributed cash flow before Q4 2021. This had assumed receipt of Vietnamese Government approvals in Q1 2020, and as this has not been forthcoming, the expected first gas date for the project will be no earlier than late 2022.
The remaining 2020 capital programme largely comprises infill drilling at Montara and Stag, and remains entirely discretionary. The Company will continue to evaluate all capital investments, including potential inorganic growth opportunities, based on anticipated accretive value add for shareholders, while maintaining balance sheet strength.
As of
'Nam Du and U Minh are an important domestic gas resource for
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The Company has a 100% operated working interest in the Stag oilfield and the Montara project, both offshore
Led by an experienced management team with a track record of delivery, who were core to the successful growth of Talisman's business in
Cautionary statements
Certain statements in this press release are forward-looking statements and information (collectively 'forward-looking statements'), within the meaning of the applicable Canadian securities legislation, as well as other applicable international securities laws. The forward-looking statements contained in this press release are forward-looking and not historical facts.
Some of the forward-looking statements may be identified by statements that express, or involve discussions as to expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of phrases such as 'will likely result', 'are expected to', 'will continue', 'is anticipated', 'is targeting', 'estimated', 'intend', 'plan', 'guidance', 'objective', 'projection', 'aim', 'goals', 'target', 'schedules', and 'outlook'). In particular, forward-looking statements in this press release include, but are not limited to statements regarding anticipated timing to both FDP approval of, and first gas production from the Nam Du and U Minh development, expected reductions to capital spending, the Company's ability to remain operating cash flow positive at prices below
Because actual results or outcomes could differ materially from those expressed in any forward-looking statements, investors should not place undue reliance on any such forward-looking statements. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, which contribute to the possibility that the predicted outcomes will not occur. Some of these risks, uncertainties and other factors are similar to those faced by other oil and gas companies and some are unique to Jadestone. The forward-looking information contained in this news release speaks only as of the date hereof. The Company does not assume any obligation to publicly update the information, except as may be required pursuant to applicable laws.
The information contained within this announcement is considered to be inside information prior to its release, as defined in Article 7 of the Market Abuse Regulation No. 596/2014, and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.
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