Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, has announced its financial results for the quarter ending 30th September 2009. Revenue from the sale of hydrocarbons increased to AED 359 million, with gross profit reaching AED 143 million. These figures represent increases of 12% and 64% respectively, compared to the same period last year, mainly due to new condensate sales from the Company’s operations in the Kurdistan Region of Iraq (which commenced in October 2008) and continued strong operations in Egypt.
Earnings before interest, tax, depreciation, amortization and exploration (EBITDAX) increased by 41% to AED 205 million as compared to the same quarter last year. However, exploration write-offs and impairment provisions, principally in respect of 3 wells in the Egyptian exploration program, were required totaling AED 110 million. As a result, the Company incurred a net loss of AED 79 million in the third quarter.
However, the above Income Statement results exclude an unrealized gain of AED 257 million in the quarter for the Company’s investment in MOL (the Hungarian oil and gas company, who are one of our partners in Kurdistan), booked directly to equity in line with the Company’s published accounting policy.
For the nine month period ending 30th September 2009, Dana Gas generated total revenue of AED 909 million, a gross profit of AED 308 million and a net profit of AED281 million. Each of these represents positive increases compared to the same period for 2008. Earnings before interest, tax, depreciation, amortization and exploration (EBITDAX) also increased by 173% to AED 1,232 million, as compared to the same period last year. Note that these results exclude an unrealized gain of AED 293 million in the nine month period on the MOL investment, booked directly to equity, as noted overleaf.
Dana Gas Egypt operations continued to contribute significantly to the results,producing 9.26 million barrels of oil equivalent (boe) year to date, an increase of 20% compared to the same period last year. The Company added two new gas discoveries in the Nile Delta, Sharabas-1 and Sama-1 in the quarter, taking the total to 7 discoveries out of 11 exploration wells during the nine month period.
Commenting on the quarterly performance, Dana Gas Chief Executive Officer, Mr. Ahmed Al-Arbeed, said: “Overall, we are pleased with the underlying results, reflecting strong performance from across the Company. Our Egypt exploration programme is continuing to yield discoveries and we expect to take the production rate close to 40,000 barrels of oil equivalent (boe) per day by the end of the year. Our exploration success ratio in Egypt of 64%, speaks for itself and our “successful efforts” accounting policy ensures we review well carrying values on a quarterly basis. The exploration expense in 3Q and the year to date reflects this. We look forward to announcing our reserve additions at the year end, following an independent review”.
“In the Kurdistan Region of Iraq, Dana Gas continues to supply gas to the Erbil power station and continues progress in constructing the LPG Plant” said Mr. Al-Arbeed. “Our financial position continues to be strong and we maintain a good level of liquidity to manage our operational needs, plus our project and drilling expenditures, for the rest of this year, and going forward into 2010,” he added.