Independent oil and gas group Parkmead has reduced operating losses while increasing its portfolio.
The Aberdeen-headquartered exploration and production company revealed that its revenues have dropped by 44 per cent to £10.4 million from £18.6 million.
Parkmead blamed the drop in oil prices for its fall in profits.
However, by putting in place a number of cost-cutting strategies, the group which produces from four oil and gas fields in UK and the Netherlands, said that it had managed to reduce operating losses from £32.7 million to £5.8 million.
The firm said it was also heading into 2017 with a stronger asset base, as a result of having won new licences.
Parkmead now has a new oil and gas licence for the West of Shetland area, which is says could hold as much as 280 million barrels of recoverable oil.
The new Shetland licence comes following a move to double Parkmead’s stake in the North Sea oil fields Polecat and Marten. Together those fields have an estimated 90 million barrels of oil. Meanwhile it has also taken an increased stake in the Perth and Dolphin fields in the Moray Firth area. The firm estimates if can recover around 80 million barrels of oil.
The group, which holds interests in 61 exploration and production blocks across Europe, says there has also been increased production at its Netherlands gas portfolio.
Tom Cross, the firm’s executive chairman said: “Parkmead is well positioned to take advantage of the ongoing lower oil price environment, and the opportunities that are arising from this.We have excellent regional expertise, significant cash resources, and a growing, low-cost gas portfolio.
“The group will continue to build upon the inherent value in its existing interests with a licensing and acquisition-led growth strategy, securing opportunities that maximise long-term value for our shareholders.”
The Parkmead group’s upbeat set of full year results come amid a six-fold increase in its Netherlands gas production alone.
Investors are now looking at Parkmead shares as a much more attractive prospect after analysts pointed out that its progress over the last financial year has been very impressive.
Despite a challenging oil price environment, Parkmead has been able to make marked improvements to its long-term outlook.
Its strategy means it has boosted its cash flow, ensuring that the company is cash flow positive on an operating basis.