Dana Gas PJSC, the Middle East's largest regional private sector natural gas company, has announced its financial results for the quarter ended 30th September 2010.
Revenue from the sale of hydrocarbons increased to AED 407 million, with gross profit of AED 179 million. These figures represent increases of 13% and 25% respectively, compared to the same period last year. This is due to strong production growth, amounting in aggregate to 24%, from the Company's operations in Egypt (where twelve fields are now producing) and in the Kurdistan Region of Iraq, where production from the Khor Mor field continues to increase.
The Company made a Net Profit after tax of AED 33 million in the third quarter, a significant improvement on 3Q 2009 loss of AED 79 million, which was due to higher write offs of unsuccessful exploration wells amounting to AED 110 million in Q3 2009 compared toAED 15 million in Q3 2010.
The Net Profit after tax for 3Q 2010 excludes an unrealized gain of AED 249 million 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 and reported within "Comprehensive Income"
Earnings before interest, tax, depreciation, amortization and exploration (EBITDAX) for 3Q 2010 were AED 260 million, a 27% increase compared 3Q 2009.
Dana Gas Egypt's operations continue to deliver strong results, producing 3.9 million barrels of oil equivalent (boe) during 3Q 2010, an increase of 15% compared to the same period last year. This included production from the Sharabas and Faraskur fields, which were brought on stream in August 2010 via the El Wastani gas plant continuing the Company's well established ability to bring its gas discoveries into production rapidly and cost effectively.
In the Kurdistan Region of Iraq Dana Gas, through its 40% share, produced 1.2 million boe of gas and condensate during the quarter, an increase of approximately 72% over the same period in 2009. The first train of the LPG Plant at Khor Mor is in partial operation, producing gas and condensate. Production of LPG is expected to start within the next few weeks which will further increase production.
Dana Gas' Continued Exploration Success in Egypt
Dana Gas also announces two new gas discoveries in the Nile Delta, Egypt. The first is West Ward Delta-1, which tested at 12.9 million standard cubic feet per day (MMscfpd) of gas from the Kafr El Sheikh formation. The preliminary estimate of mean recoverable reserves from this field is in the range of 10 to 17 billion cubic feet (Bcf) of gas. The second discovery is Salma Delta North-1 which tested at 16.1MMscfpd plus 561 barrels per day of condensate. Further appraisal is required to quantify the reserves range of this discovery; however with a gas water contact 40 metres deeper than the adjoining Salma Delta field it represents a new pool with considerable additional potential. These discoveries are in addition to the previously announced discovery during the third quarter, South Abu El Naga for which the reserves range is 50 to 90 Bcf of gas plus 1 to 2 million barrels of condensate. This brings the total discoveries in Egypt during 2010 to six out of eight wells: El Panseiya, South Faraskur, Ward Delta, South Abu El Naga, West Ward Delta and Salma Delta North.
Commenting on the quarterly performance, Dana Gas Chief Executive Officer,Mr. Ahmed Al Arbeed, said: "Dana Gas continues to deliver consistent and strong financial results. Our operations continue to perform in a very satisfactory manner, especially in Egypt and we are proud of our exploration success in the Nile Delta and our continued track record of quickly bringing these fields into production. In the Kurdistan Region of Iraq, during the period we have successfully increased gas production to meet the requirements of the power stations at Erbil and Suleymaniah and the first train of our LPG plant through which we have been producing gas since the middle of the year will shortly be producing LPG."