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(Sharecast News) - Touchstone Exploration delivered its first operational update on the Central Block asset in Trinidad and Tobago since acquiring the licence in mid-May on Monday, reporting quarter-on-quarter production growth and steady revenue generation underpinned by LNG-linked pricing.
Gross production from the asset averaged 3,023 barrels of oil equivalent per day in the second quarter, up from 2,969 daily equivalent barrels in the first quarter.
Net production attributable to Touchstone totalled 1,965 barrels of oil equivalent per day in the quarter, comprising 17.05 million cubic feet per day of natural gas and 181 barrels per day of natural gas liquids.
The AIM-traded firm said the Central Block asset included four producing gas wells and a processing facility.
It is now operated by Touchstone's wholly owned subsidiary, Touchstone Trinidad Central Block, which holds a 65% working interest.
Heritage Petroleum holds the remaining 35%.
Sales in the January to April period included 2.2 million MMBtu of LNG and 11,065 MMBtu sold into the domestic market, generating total gross revenue of $9.9m, or $6.4m net to Touchstone.
LNG volumes achieved an average realised price of $6.15 per MMBtu, with net plant gate pricing at $4.00 per MMBtu after deductions.
Domestic gas fetched $4.33 per MMBtu net, while condensate was sold at an average of $48.49 per barrel.
Revenue figures were reported net of transportation, processing costs, and a 12.5% state royalty.
"We are pleased to provide our first operational update on the Central Block following the successful completion of the acquisition," said president and chief executive Paul Baay.#
"Since the completion, we have delivered quarter-over-quarter production growth through continued plant optimization-an excellent achievement by our Central Block team."
Baay added that the update also highlighted the strategic advantage of integrating LNG-based pricing into the company's marketing portfolio.
"With commercial documentation complete and the first LNG payment expected by the end of July, we are positioned to benefit from predictable cash flows under the export contract."
Touchstone said it had completed site surveys for two additional well pads capable of supporting up to four drilling locations each, and was awaiting government approvals to proceed with construction.
The company said the Central Block's performance reinforced the strategic rationale for the acquisition, and provided diversified marketing exposure across LNG, petrochemical, and fixed-price gas sales.
At 1215 BST, shares in Touchstone Exploration were up 8.95% at 14.98p.
Reporting by Josh White for Sharecast.com.