• The RS#2 well in Bashkiria has been completed
• New price regime in Ukraine increases price on oil by 40%
• Application submitted to migrate listing to Nasdaq OMX Nordic Main Market
• SEK 30 million raised through a private placement
• Shelton Petroleum is actively pursuing expansion opportunities in Russia and Ukraine
• Revenue for the period January-June: SEK 19 (0) million
• Profit for the period after tax: SEK 0 (-9) million
• Basic and diluted earnings per share: SEK 0.00 (-0.09)
(For complete interim report see attached file)
Statement from the CEO
Shelton Petroleum has taken several steps during the second quarter to achieve our short-term goal to increase cashflow-generating production from our oil reserves. The exploration program on Rustamovskoye in Russia was successfully completed earlier this year with oil discoveries in both exploration wells. During the summer, we have completed well RS#2 and it is now ready to lift our first Russian oil. We have also commenced completion of RS#1, so we expect to have two wells on production in Russia by the end of the year. In parallel, we are preparing a field development program for Rustamovskoye and will start large-scale production drilling during 2011.
The oil production rate at the Lelyaki field in the Chernigov region outside Poltava was on par with the previous quarter. We are rolling out a long-term series of works consisting of new wells, side tracks and well workovers which step by step will raise the production levels. Furthermore, recently passed legislation aimed to align local Ukrainian prices to the world market has increased prices by 40 per cent to approximately USD 60 per barrel.
Shelton Petroleum has resources of up to as much as 300 million barrels of oil equivalent offshore Ukraine in the Black Sea and Azov Sea. It is estimated that as little as 5 per cent of the offshore gas in the region has been exploited, and Shelton Petroleum’s presence, at an early stage of the industry’s development, enables us to build a strong position and an attractive resource portfolio. The Ukrainian government recently announced that it wants to involve the multinational oil and gas companies to realize the potential of the Black Sea, and the increased level of activity will benefit Shelton Petroleum.
On the corporate level, Shelton Petroleum has applied for a listing on the Nasdaq OMX Nordic main market in order to facilitate trading for our shareholders in North America and Ukraine, increase liquidity in the share and to strengthen the company’s position in the capital markets.
Shelton Petroleum remains committed to developing the company by taking advantage of the excellent business opportunities within oil and gas that both Russia and Ukraine today offer.