Write-offs in exploration costs and reduction in land values hits Sharjah-based firm
Dana Gas net profits fell by AED32m ($8.7m) in 2009 to AED88m, despite a rise in sales revenues over the year, according to financial results released by the Sharjah-based company on 1 February.
Hydrocarbons sales revenues increased to AED1.28bn, up 12 per cent on the figure for 2008, while gross profits reached AED436, up 68 per cent.
The company attributed the fall in net profits to write-offs of exploration costs, and cuts to the value of its assets in Tunisia and Nigeria, and a reduction in inventory and land values.
The company also has operations in Egypt, Bahrain, the UAE and Kurdistan region of Iraq.
Over the year, Dana Gas Egypt produced gas, liquefied petroleum gas (LPG) and condensate at an average rate of more than 34,700 barrels of oil equivalent a day, an increase of 20 per cent on 2008.
The increase was a result of production from three gas discoveries that came onstream in 2009. The company drilled 12 exploration wells in 2009, yielding eight discoveries.
UK-based adviser Gaffney, Cline & Associates evaluated Dana Gas’s hydrocarbon reserves in Egypt as of 31 December 2009. The company’s gross proved and probable reserves are estimated to be 132 million barrels of oil equivalent, up 40 per cent on the 94 million barrels of oil equivalent reserves at the end of 2008.
“We have a good portfolio of assets and we are pleased with the progress that we have made during 2009,” said Ahmed al-Abreed, chief executive officer of Dana Gas. “Our Egypt exploration programme has been resoundingly successful, yielding eight discoveries in 2009 and a 40 per cent increase in 2P [provable and probable] reserves at the end of the year.”
“Closer to home, we are approaching the execution phase of the Sharjah Western Offshore Project which will add to our production and revenues in 2011.”
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