Faroe Posts 2009 Financial, Operational Results

Faroe Petroleum announced its audited Preliminary Results for the year ended December 31, 2009.



  • Two significant Atlantic Margin gas and oil discoveries in Glenlivet and Tornado
  • Gas and condensate discovery in Fogelberg exploration well announced in March 2010 - one of seven licenses on the Halten Terrace and the first to be drilled
  • Successful completion of the sale of Breagh, realizing £27.3m from an investment of £9.7m
  • Completion of the swap of Trym field development for cash of up to £4m plus interests in Glitne and Enoch producing oil fields
  • Production from five North Sea oil and gas fields - approximately 1,800 boepd at December 2009
  • Awarded 2 new Norwegian licenses - Barents Sea and mid Norway in 20th and APA Rounds 


  • Rights Issue announced with net proceeds of £65.1m
  • Turnover of £7.0m (31 December 2008: £2.3m)
  • Loss after tax of £6.9m (31 December 2008: £20.6m)
  • Approx £75m of credit facilities with £22.5m borrowing base and NOK 500m Norwegian exploration facilities as at 31 December 2009
  • Norway tax receivable of £12.6m (31 December 2008: £30.5m), due in December 2010
  • Adjusted net cash of £33.1m (31 December 2008: £16.7m)


  • Focused and high potential value drilling program with material equity stakes
  • Sustained target generation from a portfolio of approximately 40 licenses, augmented by new license awards
  • Pre-qualified as operator in Greenland and Norway ahead of 2010 license rounds
  • Targeting increased production revenues through development and acquisition 


  • Continuing drilling program of 8 firm wells of which 5 scheduled to be drilled in 2010
  • Preparing to apply for new licenses in 2010 rounds in Norway, UK and Greenland
  • Strong balance sheet provides a solid base for driving forward growth program
  • Planning to expand production portfolio for greater, tax efficient cash generation
  • Progress with the commercialization of the new Glenlivet and Tornado discoveries 

Graham Stewart, Chief Executive, commented, "2009 was an outstanding year for Faroe Petroleum. Most importantly we achieved significant drilling success with two West of Shetlands wells, Glenlivet and Tornado. The Company's stake in the highly successful Breagh gas field was sold for a substantial profit, demonstrating our ability to monetize drilling success. To this was added the swap of our undeveloped Trym gas field in Norway for production in two oil fields. Our finances have remained healthy and well managed to ensure we have the resources to finance our exciting ongoing drilling program, with 8 wells so far firmed up for near term drilling.

"I am delighted that our shareholders have shown confidence in the business with our £65.1m (net after costs) Rights Issue, which we announced today. This will enable an increase in our drilling program to encompass an additional eight expected wells, replenishment of our exploration portfolio, and increased production.

"Faroe Petroleum has developed a strong business model, with clear geographic and geological focus which has created a balanced exploration portfolio in the Atlantic margin and Norway, regarded by many to be among the most significant exploration plays in the world. The period ahead is a particularly exciting one as we drill many high potential value exploration wells. With a sustainable model and high quality assets, our team are confident of delivering substantial value to our shareholders."