The monetary position at the end of 1Q2019, according to company estimates, has decreased by 39% since the beginning of the year and amounts to $ 75mn, with a total debt level of about $ 1,110mn - the company associates with coupon payments and high receivables of $ 50mn.
Nostrum is not in doubt about the achievement of the target of 30ths boe/d for 2019. The company plans to publish financial statements on May 21, 2019.
Our opinion
Schlumberger continues to conduct an expertise in the north-eastern and western parts of the Biysk collector, the results of which Nostrum promises to present in 3Q2019. Drilling operations are still underway and still no results. The news did not introduce any updates on the company's operating processes. Assessing the high uncertainty regarding the prospects for production, we maintain our recommendation to “Hold” the shares of Nostrum. With high risks, we still note good opportunities for Nostrum to increase cash flows, subject to justified sufficiency of reserves in the licensed area after expert review.
