Dragon Oil Hit 50,000 bopd Milestone in 2009
Dragon Oil has provided an operational update and financial highlights for 2009.
- Eight development wells put into production in 2009;
- 9% increase in average daily production rate to 44,765 barrels of oil per day ("bopd") in 2009 compared to 40,992 bopd in 2008;
- Capital expenditure on infrastructure and drilling amounted to US $317 million for 2009 (2008: US $287 million);
- The Group's cash and cash equivalents and term deposits as at December 31, 2009 were US $1,138 million (December 31, 2008: US $876 million), including US $126 million (December 31, 2008: US $92 million) in abandonment and decommissioning funds.
Dr. Abdul Jaleel Al Khalifa, CEO, commented, "Dragon Oil delivered good performance on the back of a very volatile market in 2009 while ensuring safe and reliable operations. At the turn of 2009, production hit the landmark level of 50,000 bopd. We completed eight development wells, the Dzheitune (Lam) B platform was installed and three rigs were contracted for in addition to Dragon Oil's owned Rig 40. The operational momentum gained during the year was underpinned by stronger organisation driven by a new management team. Our principal focus over the past year has been on streamlining our operations and enforcing policies and procedures in line with international best practices. We look forward to the years ahead of us and will continue to invest for growth and to increase production. We are well positioned in both drilling and facilities contracts for stronger growth in 2010. Furthermore, we will continue to pursue growth opportunities leveraging off the strength of our balance sheet through our diversification programme and by unlocking further the value of our asset in Turkmenistan through gas monetization."
The average daily production rate on a working interest basis was 44,765 bopd for 2009. This represents a 9% increase over the comparable period in 2008 when the average daily production rate reached 40,992 bopd. The increase in the average daily production in 2009 was determined by the number of wells drilled. Because the last two wells came on stream at the end of the year, they will primarily contribute to average production growth in 2010 rather than 2009.
Dragon Oil hit the landmark production level of 50,000 bopd at the turn of 2009.
The entitlement production in 2009 was approximately 58% of the gross production compared to about 60% in 2008. Entitlement barrels are dependant, amongst other factors, on fiscal terms of the PSA, operating and development expenditure in the period and the realised crude oil price.
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