Meridian Petroleum is contemplating potential new acquisitions after turning a £2.3 million loss into £1.9 million pre-tax profits last year.  

Meridian Petroleum is contemplating potential new acquisitions after turning a £2.3 million loss into £1.9 million pre-tax profits last year.  

The AIM-listed company, which has producing assets in the USA and exploration licences in Australia, lifted turnover last year by nearly nine times to £12million. London-based Meridian upped oil production by 780 per cent and natural gas output 485 per cent for average net production in 2008 of 650 barrels of oil equivalent per day.

Over the year, the company increased estimated proven and probable reserves 319 per cent to one million barrels of oil equivalent — with risked contingent and prospective resources put at 32 million barrels of oil equivalent. Meridian used part of a £33 million facility from Australia’s Macquarie Bank to buy a £6.5 million stake in Louisiana’s producing East Lake Verret field.

The company, which took out hedging contracts covering 45 per cent of projected production from Verret and another field, Orion, ended the year with £2.6 million cash. Chairman Stephen Gutteridge declares Meridian has entered 2009 in ‘a position of considerable strength’, despite ‘the most challenging market conditions’.

He says the company has cash to invest in drilling and seismic surveys and has ‘financing in place for further developments and acquisitions’. Floated five years ago at 30p, Meridian shares surged to 234p three years ago, before slumping to 20p last December.

Highlighted by Growth Company Investor as a speculation at 21.25p two years ago, they have now rallied to 44p, valuing the company at £7 million, and could fare better than some others in the sector.