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Highlands Natural Resources reviews and expands its strategy
Highlands Natural Resources updated the market on its corporate strategy on Monday, saying it was now "ideally placed" to review its strategy following the recent funding agreement at its East Denver oil and gas project.
The London-listed firm said that agreement was set to "significantly increase" the revenues already being delivered to the company when the six new wells are completed in the coming months.
Highlands said it would accelerate the development of existing projects, as well as invest in at least one new shale development project to follow East Denver.
Its reasons for doing so would include increased cash reserves, reduced capital, overhead and operating expenditure requirements, long-term revenue generation through a 7.5% carried interest in a least eight and up to 24 horizontal wells, and the provision of additional time and resources to be used to develop new and existing projects.
Testing would be recommenced at Helios Two in the near-term, in tandem with evaluating potential opportunities to enhance the economics of DT Ultravert, and in turn its customer base, the Highlands board said.
It was also evaluating and acquiring oil and gas leases in new Colorado-based shale opportunities, with similarities to East Denver in terms of development process and value creation pathway.
The Highlands board said the "rapid payback credential" of its oil and gas development strategy had now been proven.
"We are in a strong position to build value in our existing project portfolio, and to build on our existing revenues via new oil and gas projects thanks to the rapid progress made over the past three years," said chairman and CEO Robert Price.
"The company has grown from a £1m entity, listed in 2015 by a lean team with a vision of delivering opportunistic oil asset acquisitions, to an established business with growing cash flow.
"Where we once had initial entrepreneurial concepts, today we benefit from an ongoing drilling programme and revenue generation as well as a portfolio of exciting growth opportunities including revolutionary technology and exploration assets with significant upside potential."