Operating in rural Colombia is oil company Amerisur Resources’ (AMER) greatest selling point and its chief risk. On the plus side are geological similarities to Ecuador’s Oriente Basin; on the downside is limited infrastructure and occasional social unrest. In July, a new source of complication emerged in the shape of protests “associated” with a governmental programme urging farmers to eradicate their coca crop, the raw material of cocaine, and switch to pepper plants.
Amid those protests, Amerisur took the decision to suspend production from its wells at the Platanillo field between 10 and 28 July, and updated the market on 2 August to say that the “issues have been resolved by the government”. Consequently, oil production for the year will be 109,000 barrels lighter than it might have been. The company also reported that no hydrocarbons were lost during the shutdown period, and that field costs were capped at $3,000 (£2,310) a day, down from the $60,000 when the field is fully productive.
While Amerisur believes production can still hit 7,000 barrels of oil per day (bopd) by the end of the year, an estimate of 6,000bopd-7,000bopd of average production may drop. Prior to the recent news, Investec was guiding for full-year pre-tax profit of $15.2m and EPS of 0.7¢.
