Having successfully grown our resource base, Enwell Energy has extensive and capital-intensive development plans, including upgrading infrastructure and equipment, introducing innovative new technologies, and drilling new wells, subject the constraints of the war.
At our fields, planned development work includes drilling of new well, investigating workover opportunities for existing wells, installing additional compression equipment, upgrading of our gas processing facilities and pipeline network, and remedial and upgrade work on existing wells, pipelines and other infrastructure.
We also continue to refine our geological subsurface models of our fields in order to enhance our strategies for their further development.
Given that we have 100% operatorship of our assets, we have contingency plans in place and can promptly modify our strategy and plans should future economic and operational realities dictate. At the same time, we are taking a highly discerning approach to selecting new merger and acquisition opportunities.
We also continue to invest heavily in our people’s skills and knowledge, while taking steps to build a strong performance-oriented culture with high productivity.
Why we believe continued growth lies ahead
Looking forward over the next three to five years, we are optimistic about our growth prospects, subject to resolution of the disruption caused by the war in Ukraine. Here are the key reasons why.
1. Demand for gas forecast to grow globally and in Ukraine.
Natural gas emits less pollution than other fossil fuels. In a future of tougher environmental regulation, it is the only fossil fuel whose share in global energy consumption is forecast to grow.
Gas is currently the world’s third largest source of energy, forecast to converge with oil by 2040. The average annual growth rate is forecast to be around 2%.
Prior to the war, only approximately two thirds of Ukraine’s gas demand was domestically produced with prices tending to follow the prices in Europe.
The gas market in Ukraine has been liberalised, allowing local oil and gas producers greater access to an increasing market.
2. A forecasted improving situation in Ukraine.
The fiscal and economic situation in Ukraine is expected to significantly improved post the war.
3. Investing in the future.
Having successfully grown our resource base, the Group has plans for extensive and capital intensive development of its assets, including drilling new wells, upgrading infrastructure and equipment, and introducing innovative new technology in our operational activities. Given that we have 100% operatorship of our assets, we have the ability to maintain rigidly monitored contingency planning and can promptly modify schedules and plans should future economic and operational realities dictate. At the same time, we take a highly discerning approach to selecting new business opportunities.
We are also investing in our people, building a strong performance-oriented culture, with high productivity.
4. Large reserves.
Through careful and incremental development of our fields, our proved plus probable (2P) reserves have grown to over 57 MMboe.
5. A disciplined operator.
We work in a carefully structured way. We are focused on implementing projects on time and on budget, through the use of optimal technological solutions and rigorous risk management. A disciplined and detailed budgeting process is essential to the cost forecasting and performance discipline we pursue. We have a very strong QHSE record. Our Continuous Improvement System (targeting employee initiative feedback and refinement) means we are focused on getting better at what we do, day by day, and year by year.
As a result, we have the ability to produce in lower oil or gas price environments.
6. Take nothing for granted.
Rigid financial and risk planning reduces our exposure to external factors. We always ensure capital is available for our planning horizon. We maintain a discerning eye for potential new business opportunities and acquisitions, although we ensure that our selection criteria are stringent and challenging. We manage production levels to preserve reservoir performance.
A growth strategy designed for challenging times
As we continue to take careful steps to maximise the value of our fields, Enwell Energy’s growth strategy is measured, disciplined and smart. It is a strategy designed for challenging but opportunity-rich times.