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Be the first with the news that moves the market- Jadestone Energy (TSXV:JSE) has announced they will delay a gas field project in Vietnam
- The Nam Du and U Minh gas field developments did not receive Vietnamese Government approvals
- The move comes just a week after the company announced it did not expect market forces to change it’s plans this year
- The company will bank the C$130 million set aside for the project.
- Jadestone Energy (JSE) are holding steady, with shares trading at C$0.50 each.
Jadestone Energy (TSXV:JSE) has announced they will delay a Vietnamese gas field development after being denied approvals from the Vietnamese Government.
The company had hoped to develop the wholly owned gas development blocks offshore in South West Vietnam.
The decision comes after the company hedged half of the Montara oil fields production at an average price of US68.45/bbl, substantially higher than US$29.00/bbl the Brent price is currently trading at.
This news was meant to signal that the company was protected against the damaging winds of uncertain commodity prices and COVID-19 fears.
However, in their announcement today, the company has admitted that by not going ahead with their Vietnamese developments, they will have substantially more cash to protect in the short-to-medium term.
The company conceded that the expenditure would not have yielded any sort of return until Q4 2021.
Given the circumstances, the non-approval of the development may be a blessing in disguise.
It’s not been a good start to the year for Jadestone, which started the year with shares trading for C$1.50.
The company shares are now being traded for a third of that, representing a huge drop in value over the past 3 months.
Jadestone has also recently announced it will delist from the TSXV and move solely to trading on AIM, a market of the London Stock Exchange.
The company expects to save some $87,000 by maintaining a sole listing.
Jadestone CEO and President, Paul Blakeley, said the company was committed to discipline in the current uncertain environment.
“Nam Du and U Minh are an important domestic gas resource for Vietnam, which will ultimately contribute to generating clean power and essential fertiliser for the ongoing development of the Southwest Vietnam economy.
“But, with ongoing Vietnamese Government delays to the FDP (Field Development Plan) approval process, there is a short-term option for us to defer our spending commitments on the project, which we’ve decided to take,” he said.
Jadestone Energy (JSE) are holding steady, with shares trading for $0.50 at 1:39pm EST.
