Niko Resources cuts sales volumes forecast; gets offers for assets

Fri Mar 8, 2013 10:11am EST
 
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March 8 (Reuters) - Canadian oil and gas producer Niko Resources Ltd cut its sales volumes forecast for the current quarter, citing work at a reservoir in the D6 Block off India's east coast, and said it received significant offers for certain non-core assets.

Shares of the company rose as much as 7 percent to C$6.45 at open on the Toronto Stock Exchange on Friday. The stock has fallen 33 percent since the company reported quarterly losses in February.

Niko now expects sales volumes of about 126 million cubic feet equivalent per day (mmcfe/d) in the fourth quarter, down 3 percent from its earlier forecast.

The Calgary, Alberta-based company has been struggling with a series of setbacks including abandonment of wells in Indonesia and Trinidad and declining volumes in India.

Niko said on Friday sales volumes would be lower in India in the early part of fiscal year ending March 2014.

The company has a 10 percent stake in the D6 Block in the Krishna Godavari basin, while India's Reliance Industries Ltd holds 60 percent and BP Plc owns the rest.

Niko also cut its forecast for funds from operations for the January-March quarter by 12 percent to about $22 million.

Niko said it was evaluating the offers, but did not name the non-core assets. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila)