Khaleej Times reported that Dana Gas of Middle East more than trebled its Q2 net profit after tax to AED 124 million up 276% compared with AED 33 million a year ago.
The Abu Dhabi listed company, which has beaten analysts’ forecasts, attributed the increase in earnings to 20% increase in production from its operations in Egypt and Iraqi Kurdistan as well as higher prices for oil, condensate and liquefied petroleum gas. Analysts had forecast an average profit of AED 103.38 million.
The company said that revenues from the sale of hydrocarbons increased to AED 627 million with gross profit reaching AED 341 million. These figures represent increases of 46% and 90% respectively compared to the same period last year. This is due to strong production growth coupled with higher market prices for oil, condensate and LPG during 2011. Production increased in aggregate by 20% from the company’s operations in Egypt and in the Kurdistan Region of Iraq, where production from the Khor Mor field continues to increase.
It said that earnings before interest, tax, depreciation, amortization and exploration increased by 63% to Dh411 million as compared to the Q2 of last year. Net profit for the H1 ended June 30th 2011 was AED 216 million compared to AED 66 million in the same period last year. EBITDAX for the 6 month period increased to AED 814 million compared to AED 480 million in the same period last year.
Dana Gas said that its Egypt’s operations have continued to deliver strong results producing four million barrels of oil equivalent during the Q2 an increase of 6% compared to the same period last year. During the period Dana Gas announced a new discovery at South Abu El Naga-2 in the West El Manzala Concession which increased the estimated reserves by more than 60 billion cubic feet of gas.
Mr Ahmed Al Arbeed CEO of Dana Gas said that the company is working diligently to meet the challenges it face during the political changes in the region and at the same time seeking to take advantage of opportunities as they arise.
Dana said that in its Sharjah Western Offshore Concession an independent assessment of the reserves of the Zora field is close to completion. An invitation to tender for the fabrication and installation of the offshore platform has been issued and once all the contractual arrangements are completed the project construction phase will commence. The total development cost of this field is estimated to be AED 450 million to AED 550 million.
The company is also in discussions with authorities to expedite payments of its overdue receivables in Egypt and likewise in the Kurdistan Region of Iraq. Collection of receivables improved during the second quarter of 2011 compared to the Q1. The company collected approximately AED 210 million in revenues during the second quarter, AED 130 million from Egypt and AED 80 million from the Kurdistan Region of Iraq.
In May, Dana’s management reported delayed payments of USD 148 million for gas sales to the Egyptian government and said if these were not met it would impact on its future investments in the country. The payment delay was caused by disagreements over production sharing agreement clauses with respect to the means of calculating profit share splits.
The company seeks to manage its capital expenditure in line with cash generation and is maintaining tight control of its costs with total capital expenditure for the Q2 of 2011 being Dh106 million, a 31% reduction compared to the same period in 2010. Dana Gas’ cash position remains strong with a balance at June 30th 2011 of AED 400 million.
The energy firm said that its USD 1 billion Sukuk is maturing in October 2012 and the Company is working to implement a Sukuk Liability Management Program with regard to this bond. Dana Gas continues to assess various options for its optimum capital structure and will update the market when appropriate.
(Sourced from Khaleejtimes.com)
