Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, today announced its preliminary un-audited results for the year ended 31 December 2014.
Dana Gas saw full year gross revenue reach US$ 683 million (AED 2.50 bn), a 5% annual increase despite a sharp fall in oil prices during the second half of 2014. This revenue increase was predominantly due to higher production from Egypt and the Kurdistan Region of Iraq (KRI). Production in Egypt rose 9% to 14.6 million barrels of oil equivalent (boe) and KRI production increased 3% to 10.4 million boe, boosting overall Group production by 6% to 25.1 million boe in 2014.
Operating profits were US$ 10 million (AED 37 million) higher in 2014 as compared to 2013. Despite improved production performance and a more stringent approach to costs, the Company posted a lower net profit of US$ 125 million (AED 457 million). This was mainly due to falling oil prices in the 3rd and 4th quarters of the year. In 2013, the Company posted a net profit of US$ 156 million (AED 571 million), enhanced by a one-off gain of US$ 39 million (AED 143 million) from the sale of MOL shares. On a quarterly basis, Q4 2014 revenue was US$ 142 million (AED 521 million) with net loss US$ 4 million (AED 15 million) as compared to US$ 186 million (AED 682 million) and net profit of US$ 35 million (AED 128 million), respectively in Q4 2013. The net loss during the quarter was primarily due to lower realized hydrocarbon prices and recognition of an impairment charge.
As of 31 December 2014, Dana Gas had collected cash of US$ 163 million (AED 597 million) from Egypt, excluding $ 47 million of offsets against Block 6 signature bonus and accounts payable. Some of the monies were reinvested into existing projects and production facilities in Egypt throughout the year and the balance will be ring-fenced to pay for commitments made under the Gas Production Enhancement Agreement. The Company was also able to commence direct, local sale of condensate and LPG in the KRI, resulting in US$ 34 million (AED 125 million) of collections. Cash balance at year end stood at US$ 184 million (AED 674 million).
Patrick Allman-Ward, CEO of Dana Gas, said: “Despite the fall in oil prices Dana Gas’ strong financial performance in 2014 was driven by a rise in annual production. Our current short-term focus is on increasing our production further, driven by our Gas Production Enhancement Agreement in Egypt and the Zora Gas Project in UAE which will add 10% to our current group production of 68,900 boepd. Our long-term focus is on our three new onshore and offshore blocks in Egypt and developing our Khor Mor and Chemchemal gas fields in the Kurdistan Region of Iraq. Our prudent and focussed approach to cost controls has made us one of the lowest cost operators in the region and we are now in a stronger position to deliver the longterm value our shareholders deserve.”