UK-based independent oil firm EnQuest revealed Wednesday what analysts described as "solid" first-half results. The firm's 1H 2015 revenue decreased to $444 million from $503.8 million in 1H 2014, while 1H 2015 profit at the EBITDA level was $226.7 million – representing a 20.2-percent decrease on 1H 2014.
Average production for the first half increased to 29,665 barrels of oil equivalent per day from 25,292 boepd in 1H 2014. The company's production figure, which marked a 17.3-percent increase on last year, comprised a net daily average of 21,888 boepd from the UK Continental Shelf, with the remaining 7,777 barrels coming from the PM8/Seligi asset in Malaysia.
In its half year results statement EnQuest said that the UK North Sea Kraken project, which it holds a 60-percent interest in, is on-budget and on-schedule for first oil in 2017. The company also stated that first oil at the Alma/Galia project in the central North Sea was expected within a few weeks, and that the 2015 full year production guidance has been maintained between 33,000 and 36,000 boepd.
The company’s net debt at the end of 1H 2015 was $1.28 million.
EnQuest CEO Amjad Bseisu commented in a company statement:
"EnQuest has responded well to the lower oil price environment, delivering a strong performance driven by production gains and cost reductions, both core areas of expertise, and by a well-executed hedging program. EnQuest now anticipates that 2016 full year unit opex [operating expenditure] will be in the low $30 dollars per barrel. EnQuest achieved continuing high levels of operating efficiency in the North Sea and a good production performance in Malaysia, with PM8/Seligi’s first first-half contribution. Our two major developments are progressing well and we expect first oil from Alma/Galia within a few weeks."
Bseisu described EnQuest's bottom-line result as "a strong performance" given the almost 50-percent drop in the price of oil.
"As the current capital program reduces over the next two years and EnQuest benefits from lower cost operations and higher production, we expect to move into positive free cashflow at prevailing oil prices," he added.
Oil sector analysts at London-based investment bank Westhouse Securities noted that EnQuest produced "solid results in what has been a difficult period for the sector", but noted that a close eye should be kept "on the cashflow performance as net debt at end June is higher than we had forecast".
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