The UAE’s Dana Gas, has announced its preliminary financial results for 2010 which indicated that the company made revenue of AED 1.785 billion (US$485 million) from the sale of hydrocarbons with a gross profit of AED 781 million ($212 million), representing a 40% and 79% increase respectively compared to 2009.
The company attributes the significant rise its continued production growth in Egypt and from the Khor Mor field in the Kurdistan Region of Iraq.
Earnings before interest, tax, depreciation, amortisation and exploration (EBITDAX) was AED 1.034 billion ($280 million). In 2009 Dana Gas’ EBITDAX was 1.440 billion ($392 million) due to a one-off gain reported in 2009 from the sale of a 10% interest in the Kurdistan Region of Iraq assets.
The resulting full year net profit for Dana Gas in 2010 was AED 158 million ($43 million) compared to AED 88 million ($23 million) in 2009, an 80% increase which reflects growing production and higher oil prices especially in the fourth quarter of 2010, the company said.
The company said that these results exclude an unrealised gain of AED 118 million ($32 million) during 2010 on the company’s investment in MOL (the Hungarian oil and gas company, who are one of its partners in Kurdistan. This gain for 2010 comes on top of an unrealised gain during 2009 of AED 370 million ($100 million).
The company’s total comprehensive income for 2010 stands at AED 276 million ($75 million).
Egyptian operations
An independent evaluation of Dana Gas Egypt’s hydrocarbon reserves found that as of the end of December 2010 the company’s gross proved reserves (1P) are estimated to be 89 million barrels of oil equivalent (MMBOE) (it was 47 MMBOE in 2009). The gross proved and probable reserves (2P) are estimated to be 152 MMBOE (it was 132 MMBOE in 2009). The gross proved, probable and possible reserves (3P) are estimated to be 253 MMBOE (it was 222 MMBOE in 2009).
The 2P reserves results give a total reserves addition of 15% (after 2010 production) and 27% (before 2010 production). The total production replacement ratio associated with this 2P reserves increase is 229%, according to the company.
Operational Results
During 2010, Dana Gas Egypt produced gas, LPG ,condensate and crude oil at an average rate of just over 42,300 barrels of oil equivalent per day (boepd), an increase of over 20% compared to 2009, due to production from Dana Gas’ recent gas discoveries that were brought on stream during the year. Additionally in the Kurdistan Region of Iraq, gas and condensate was produced at an average rate, net to Dana Gas’ 40% interest, of 13,200 boepd.
Dana Gas Egypt drilled a total of eleven exploration wells during the year which yielded seven discoveries.
Commenting on the performance for 2010, Dana Gas chief executive officer, Ahmed Al-Arbeed, said: “Dana Gas has continued to make progress in its operations during 2010 and this is reflected in its increasing profits. I am particularly pleased that 2010 has been a year in which we have delivered consistent financial results in every quarter which reflect our strong operational performance, with minimal exceptional items. Our Egypt exploration programme continues to deliver class leading performance, yielding seven discoveries in 2010 resulting in a 2P reserves replacement ratio of 229%.”
“In the Kurdistan Region of Iraq, Dana Gas continues to supply gas to the Erbil and Bazian power stations at increasing rates producing 76% higher volumes in 2010 compared to 2009 which will further increase now that LPG production has commenced from our LPG Plant,” said Al-Arbeed.
