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Caspian Sunrise PLC on Thursday announced the creation of a new oil trading division, updated on its current operations, and declared a maiden dividend of 0.04 pence per share.
Shares in the Kazakhstan-focused oil & gas exploration and production company jumped by 41% at 3.53 pence on Friday morning in London, hitting an intraday high of 5.90p. The stock remains down 12% over the past 12 months, however.
Caspian Sunrise explained that selling oil to the international market is currently less attractive than selling domestically. This is because the $25 to $30 per barrel discount for oil sent through Russian pipelines, together with taxes, are still set at the full Brent price. As a result, Caspian Sunrise explained that all output is now being sold domestically.
Further, to take advantage of changes in regulations that will allow the oil company to sell its own production direct to international and domestic buyers from the start of next year, Caspian Sunrise has created a new wholly owned oil trading subsidiary.
The new division is expected to allow a $5 to $10 per barrel increase to the net price received by the company.
With regard to its operations, Caspian Sunrise said it remains "encouraged" by strong oil shows from Deep Well 802 and expects to test it before the end of the year, following the drilling of a side-track to target the first interval of interest.
After drilling at Deep Well 802, Caspian Sunrise intends to use the rig at Deep Well A5 to move a stuck pipe and target another oil-bearing interval, which previously produced at a rate of around 1,000 barrels of oil per day.
Work is planned to resume at Deep Well A7, while Deep Well A8 will be plugged and abandoned.
At the firm's shallow wells, work to bring wells 141 and 142 back into production is expected in the first quarter of 2023, and a new shallow well, Well 155, is expected to spud before the end of the year.
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