DNO International, a Norwegian independent, has posted record production and financial results for 2011, with working interest (WI) production in 2011 more than doubling to 39,966 barrels of oil per day (bpd) versus 17,381 bopd in 2010, and operating revenues of NOK 2,070 million ($362 million) in 2011, up 65% from NOK 1,251 million ($218 million) in 2010.
Interim payments from Baghdad for kurdish oil production helped push net profits for the fourth quarter of 2011 to NOK 203 million ($35.4 million), bringing the full year figure to NOK 653 million ($114.1 million), compared to a loss of NOK 283 million ($49.5 million) in 2010.
News that the company has returned to profit for the first time in three years is bolstering speculation amongst analysts that the company is the pick of acquisition targets as the upstream oil sector in the Kurdish region of Iraq enters a new phase of development.
“We have seen a lot of analysts suggesting that we are a target,” DNO’s CEO Helge Eide said on a conference call. “I think that is a compliment.”
DNO has announced a twofold boost to its capex program in 2012 as it moves some of its capex budget from exploration to increasing production capacity from its prize Tawke field. The company aims to spend NOK 1 billion ($174 million) this year, most of which is allocated to increasing Tawke’s production capacity to 100,000 bpd.
The company hopes to drill 19 wells across its assets this year, including further Kurdish exploration and a three well drilling program offshore Oman. The company has submitted field development plans for the Benena and Bastora blocks in Kurdistan, which it hopes will be approved later this month.
The company is also working towards a listing on the London Stock Exchange – the most liquid in the world for oil explorers – later this year, but may get snapped up from the Oslo bourse before it does so.
DNO’s shares on the Oslo bourse are trading broadly flat, after climbing from NOK 5.10 ($0.89) six months ago to NOK 10.35 ($1.81) today.
