April 23, 2020 / 9:51 AM / in a month

Serica to maintain dividend, sees drilling delays

LONDON (Reuters) - Serica Energy intends to maintain its dividend in 2020, its CEO said on Thursday after the North Sea energy producer announced its first-ever payout following a rise in 2019 profit.

CEO Mitch Flegg said, however, that Serica’s 2020 drilling programme is under review due to coronavirus-related movement restrictions and supply chain difficulties.

As a result, Flegg said its planned Columbus field development will likely be pushed into next year, while Rhum 3 well drilling remains on track to start at the end of 2020.

Serica announced a maiden dividend of 3 pence per share after its gross profit in 2019 more than quadrupled to 85.8 million pounds ($106 million).

“Our intention is that (the dividend) is here to stay,” Flegg told Reuters.

Serica shares were up around 10% by 0930 GMT, compared with a 1.8% gain in the broader energy index .SXEP.

The company’s oil and gas production rose by around 20% last year to 30,000 barrels of oil and gas equivalent.

Serica has reduced the number of personnel on its platforms by around one third following the coronavirus outbreak, which means that its offshore operations are focused on keeping production running, Flegg said.

Reporting by Ron Bousso; editing by Nick Tattersall

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