07:13 AM EST, 11/21/2024 (MT Newswires) -- LNG Energy Group ( LNGNF ) overnight Wednesday provided an operational update in respect of its Colombian operations and covering issues such as gas sales agreements, corporate reorganization initiatives and an interim COO appointment.

On gas sales agreements, as previously announced on October 21, 2024, as a result of unexpected production restrictions at certain wells in the Bullerengue natural gas field, the company has had to limit natural gas deliveries under certain gas sales agreements dedicated to supplying natural gas demand. Lewis Energy Colombia, Inc., a wholly-owned subsidiary of the company, entered into amendment to certain gas sales agreements to reduce the applicable volumes by 5.0 MMbtu/d for a period of four months with no significant changes to the average natural gas sales price.

LNGE said LEC's attempts to address the production disruptions by way of an extensive workover campaign and drilling initiatives have not resulted in production increases. As a result, LEC has issued notice to the applicable regulator in Colombia regarding a restriction in the natural gas deliveries under certain supply contracts. It noted LEC continues to receive the proceeds from the natural gas sales and has notified its senior lenders of the foregoing notice.

In order to reduce costs, LNGE is in the process of implementing a corporate reorganization at its operations in Colombia resulting in annualized savings of near $1 million. The company said it continues to review ways to optimize costs, its business and operations.

LNGE also announced the resignation of Nicolas Ziperovich as Chief Operating Officer, to pursue new opportunities. Stan Jumper, a director of the company, has been appointed as Interim COO.

Its stock was unchanged at $0.12, at low end of 52 week range, in Canada yesterday.