Abu Dhabi National Energy Company (Taqa), posted a net loss of Dh608 million in the first quarter, compared to a profit of Dh256 million in the first quarter of 2015 amid a low oil price environment that impacted the company’s earnings.
The revenue was down by 24 per cent to Dh3.9 billion in the first quarter this year compared to Dh5.1 billion in the first quarter last year due to a 43 per cent drop in the price of oil and gas sold by the company.
Taqa said it is planning to slash expenditure this year as earning decrease. Full year 2016 capital expenditure is expected to be below Dh1.8 billion, a 42 per cent reduction compared to 2015.
“We continue to execute our strategy to meet the challenges of the low commodity price environment. Our cost transformation programme continued to deliver outstanding results in the first quarter with savings of Dh1 billion while delivering one of our best operational performances in our history,” said Edward LaFehr, Taqa chief operating officer.
He said power generation volumes and robust oil and gas production coupled with sustainable cost savings have boosted free cash flow by 83 per cent.
“This is helping us maintain our healthy liquidity position of Dh12.2 billion.”
Despite significant cuts in capital expenditure, the company maintained production levels of 153,700 barrels of oil equivalent per day, three per cent lower compared to first quarter of 2015. In power and water operations, Taqa produced record power reaching 17,022 gigawatt hours, an increase of 7 per cent on the previous year’s quarter.
Taqa’s Atrush oil project in Iraq’s Kurdistan region is set to commence oil production this year with a production capacity of 30,000 barrels per day, LaFehr said in a conference call with the analysts.
“The project is 90 per cent complete and is expected to start later this year,” he said.
Earlier this month, the company that it was in talks to sell its oil and gas assets to another Abu Dhabi based entity. Taqa, which operates in eleven countries is majority owned by the government of Abu Dhabi.
By Fareed Rahman
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