StockMarketWire.com - Oil and gas explorer Serinus Energy posted another first-half loss and warned it could go into liquidation, as it was hurt by political unrest in Tunisia and project delays in Romania.

The company said it was likely to breach its debt covenants and may ask its lenders about getting a potential waiver, though that couldn't be guaranteed.

Net losses for the six months through June narrowed to $1.6m, compared to losses of $2.1m a year earlier, when the company also recorded a $2.2m loss on an asset disposal.

Serinus said financial difficulties stemming from the oil-price collapse in 2014 had been compounded during 2017 by the shut in of both its Tunisian fields due social unrest and protests in the African nation.

The Sabria field recommenced production in September 2017 but was significantly impacted by the shut-in with production only returning to 60% of its pre shut-in levels.

The Chouech Es Saida field remained shut-in, and the company said it was currently working towards reopening the field in February 2019 -- although this was dependent on the resolution of the political unrest.

In Romania, Serinus said there had been setbacks completing a gas plant and therefore first sales due to delays associated with obtaining an electrical permit.

The permit had now been obtained and production in Romania was expected to commence later in August 2018, reaching optimal capacity by the end of the month. It was, however, possible that production commencement or optimal capacity could be delayed by one-to-two months, Serinus said.

'Base case forecasts indicate that the group will breach the EBRD covenants at September 30, 2018 and for the foreseeable future, the result of which is that the senior and convertible loans will become repayable on demand at the discretion of the bank,' the company said.

'The directors intend to seek waiver of those covenants once the results for September 30, 2018 are known and the continued availability of those existing loan facilities represents a material uncertainty.'

'The key assumptions in the base case forecasts are the timing of the start of commercial production in Romania and the field's post-commissioning performance and the ability to reopen the Chouech Es Saida field in Tunisia as set out above.'

'The base forecasts, including when taking into account any reasonably possible downsides, indicate that the group will be able to operate within the existing loan facilities, should they remain available.'

'The directors consider that the continued availability of the existing facilities represents a material uncertainty that may cast significant doubt on the ability of the group to continue as a going concern.'



Story provided by StockMarketWire.com