Imperial Energy Plans Higher Capex to Meet Output Targets

Imperial Energy will increase its $600 million capital investment plan for the next three years in order to meet a new production target of 80,000 barrels per day by 2011, its chairman said Monday.

"Our capex plan from now through to 2010 will be in excess of the $600 million we previously had," chairman Peter Levine said, declining to give the new amount.

It is the first time the company, which is listed in London, has given a forecast for 2011 as well as for 2010, when it expects to produce 60,000 bpd.

Imperial also said it exceeded its production target of 10,000 bpd for last year. It has previously said it would produce 35,000 bpd by the end of 2009 and 25,000 bpd by the end of 2008.

By increasing output eightfold from 2007 to 2011, Imperial will go from a small company to a medium-sized operation.

"We're bringing new fields on stream in the Tomsk area, there is a lot of oil in the ground and we are optimistic," Levine said, refusing to identify the fields.

Imperial said earlier in a statement that it would focus on exploration and was committed to discovering major new oil reserves this year.

The year will also include an "aggressive program" involving the drilling of 65 production and appraisal wells at four of its fields.

Levine also confirmed the company's intention to spin off its own drilling company, Rus Imperial Group, by listing on London's Alternative Investment Market in the spring.