Abu Dhabi National Energy Company TAQA has officially released its full year 2010 results which saw it register a 460% improvement in profits – a 45 percentage point difference from the figure it reported in its preliminary results in February.
The company recorded Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of AED 10.4 billion (US$2.8 billion) and Net Profit After Tax of AED 1.0 billion ($272 million).
The positive commodity pricing environment combined with increased power production delivered a 27% year-on-year increase in revenues. The company said that its cost of sales benefitted by AED 416 million ($113 million) from the reversal of a previous oil and gas asset impairment resulting from a successful oil and gas drilling programme in North America.
TAQA’s Oil & Gas business benefitted from a positive pricing environment during 2010.
WTI oil price averaged $85.21/bbl for Q4 2010 and $79.40/bbl throughout the year up from an average of $61.65/bbl for 2009. Prices for Brent crude increased to an average of $88.01/bbl in Q4 2010 and $83.48/bbl for the year up from $75.54/bbl in Q4 2009 and $73.59 bbl on average in 2009
Total Oil & Gas full year revenues, including gas storage and other operating revenues, totalled AED 9.3 billion ($2.5 billion), an increase of AED 2.0 billion ($544) compared to AED 7.3 billion ($2 billion) in 2009. This 27% increase was driven primarily by the increase in crude oil and natural gas prices in 2010.
Total global production for 2010 was 134.6 mboe/day with a reserve replacement ratio of 176%.
North America
Production levels in North America remained strong at 90.3 mboe/day in the fourth quarter and 88.6 mboe/day for 2010.
TAQA acquired interests in West Central Alberta during the second half of 2010 adding 6.1 mboe/day of liquid rich gas in addition to the strategic Bearberry gas processing facility.
TAQA also launched the development of a large oil project in the Central Alberta Cardium field with early results exceeding expectations.
UK
Production volumes in the UK North Sea were 36.1 mboe/day in the fourth quarter and averaged 37.3 mboe/day for the full year of 2010.
During the year, TAQA completed the North Cormorant and mobile drilling campaigns in the UK North Sea, adding nearly 14,000 boe/day in new production plus the Falcon field discovery, which is expected to come on-stream during 2011.
In September, TAQA celebrated its first anniversary as Duty Holder of Cormorant Alpha, North Cormorant, Tern and Eider. It also completed four planned shutdowns in the UK North Sea totalling 60,000 man-hours on time, on budget and with no health or safety incidents.
Also in September, TAQA acquired an 81% stake in production licenses for two blocks in the Otter Field Development Area, adding approximately 6,000 boe/day at completion.
Netherlands
Production levels increased in the Netherlands to 8.7 mboe/day, an increase of 29% year-on-year, which is largely attributed to the restarting of production at the Rijn oil field following a three-year re-commissioning programme.
TAQA increased its equity in the flagship Bergermeer Gas Storage project from 36% to 60% in August. During 2010 the project progressed through to the final permitting stage and is expected to start construction in 2011.
Abdulla Saif Al-Nuaimi, chief executive officer and managing director of TAQA, said: “2010 was an excellent year for TAQA – not only did we record strong financial and operational performance, but we also made significant headway in realigning the business to a more focussed strategy which targets long-term value.
“We have added high-quality, earnings-accretive assets to our global footprint over the course of the year. Alongside these additions, we have conducted a strategic review of our international portfolio and have identified and prioritised the best opportunities for value creation. Furthermore, we have taken steps to improve our organisational structure by strengthening our headquarters in Abu Dhabi. The net result is an organisation which offers real organic growth potential.
“The continued support of the Emirate of Abu Dhabi, our pipeline of organic projects and a strong financial position fill me with confidence for 2011 and beyond.”
Carl Sheldon, general manager of TAQA, said: “TAQA’s operational performance is evident in our financial results for the year. Overall, oil and gas production finished the year at the high end of our original guidance, while revenues were simultaneously boosted by better oil and gas pricing.
“The consistent reliability of our high-performing power and water facilities has once again provided a stable backbone to TAQA’s overall results. Combined with discipline in operational expenditures and the success of our drilling programs in North America and the UK North Sea, our operational efficiency has enabled us to deliver strong EBITDA and Net Profit.”
