Losses widen at Enegi

LOSSES at the oil exploration group Enegi Oil have doubled and its Canadian subsidary is negotiating with creditors.

The Manchester-based business has reported a like-for-like pre-tax loss of £2.5m, up from £1.22m for the six months to December 31.

Last month Enegi admitted its main test site in Canada was not economically viable, particularly while oil prices are low.

Now the financial position at PDI Production (PDIP), its Canadian subsidiary, has “deteriorated significantly” and it is in talks with creditors to reschedule debts.

Enegi said increased costs associated with its drilling programme at Garden Hill in Canada had led to the bigger loss. The firm has also written off £1m in relation to an unpaid debt dating back to its flotation.

Continued losses, combined with the bleaker outlook for Garden Hill, have also led to a boardroom shake-up.

Chief executive Alan Minty has become part-time executive chairman, replacing non-executive Clive Fowler, while Thom Board is replacing Mr Minty. Chief financial officer Kevin McNair has stepped down.

Mr Minty said: “This has been a difficult period for the company where there have been disappointments and factors which have impacted the company’s performance, some of which have been beyond the company’s control.

“However, whilst we expect the next few months to be testing, we must not lose sight of what we have already achieved as well as our vision for the future.”