Serica Energy reaffirms production, financial guidance
By Josh White
Date: Thursday 22 May 2025
(Sharecast News) - Serica Energy reaffirmed its 2025 production and financial guidance on Thursday, as it prepared to restart output at the Triton hub following repairs and the early completion of its annual maintenance programme.
Production averaged 26,500 barrels of oil equivalent per day in the first four months of the year, with the AIM-traded company, which was holding its annual general meeting, on track to achieve full-year guidance of 33,000 to 37,000 daily equivalent barrels.
The temporary Triton outage, triggered by damage sustained during Storm Éowyn, contributed to a $19m cash outflow during the period, alongside a $10m payment for the acquisition of Parkmead E&P and $80m in capital expenditure.
Cash balances stood at $129m as of 30 April, with net debt rising to $102m.
A $71m tax rebate was expected to boost free cash flow later in the year.
New wells at the Guillemot North West and Evelyn fields were reportedly ready to start production upon Triton's restart, while the Belinda well - flow tested at 7,500 barrels of oil equivalent per day was scheduled to come online in early 2026.
Serica said it was progressing plans to commercialise significant 2C resources, including the Kyle redevelopment and over 20 potential infill targets on the Bruce field.
The acquisition of Parkmead E&P was completed, enhancing Serica's tax position with more than $2.5bn in ring-fence losses and allowances.
Serica said it was continuing to assess merger and acquisition opportunities, while maintaining a disciplined approach to valuation and strategic fit.
A final dividend of 10p per share was proposed, with payment due on 25 July, as the company prepared for a move to the Main Market of the London Stock Exchange in the fourth quarter.
Serica chair David Latin used the annual general meeting to call for regulatory stability and fiscal clarity in the UK North Sea, warning that continued policy uncertainty risked deterring investment and damaging energy security, jobs, and emissions targets.
"Maintenance work at Triton remains on track to restart production around the end of June, with the addition of new wells from the Guillemot North West and Evelyn fields providing the potential for production from the Triton Hub alone to surpass the 25,000 barrels of oil equivalent per day net to Serica delivered earlier in the year," said chief executive officer Chris Cox.
"This should support significant cash generation in the second half of the year and beyond.
"The drilling performance and subsurface results of those new wells have been outstanding, and the BE01 well on Belinda was also completed ahead of time and under budget."
Cox said the "impressive" flow test rate of 7,500 equivalent daily barrels was "another demonstration" of the company's ability to identify and deliver subsurface opportunities, adding that Belinda - in which Serica has a 100% working interest - would add to its production early next year after the requisite subsea infrastructure was completed.
"As we continue to focus on creating shareholder value both organically and through accretive mergers and acquisitions, our subsurface team is now focused on converting Kyle and future Bruce well volumes from resources to reserves.
"However, in order to take FID on these growth investments we will need a regulatory and fiscal regime that supports the delivery of projects in the UK North Sea, and the production of vital homegrown energy."
At 1207 BST, shares in Serica Energy were up 3.56% at 144.99p.
Reporting by Josh White for Sharecast.com.
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