Abu Dhabi: Dana gas, the UAE energy company posted a $33 million profit for full year 2016, nearly four times lower than full year profit of $144 million in 2015, according to a company statement on Thursday.
The company reported 2016 fourth quarter profit of $7 million compared to $134.2 million in the fourth quarter of 2015.
The profit was lower due to a gain on one-off sale of five per cent interest in Pearl and settlement from the RWE arbitration in 2015, Dana Gas said.
Dana Gas CEO Dr Patrick Allman-Ward said the company continued to improve significantly its margins by reducing overheads and operational expenditure.
“Unfortunately, we still face challenges around collections, which were disappointing in Egypt last year, and we must therefore balance further investment in the country with collections going forward. The situation around lack of payment in Egypt coupled with our sukuk maturity due at the end of October this year means that we must remain focussed on short-term cash preservation.”
Despite this backdrop, the medium term outlook for Dana Gas remains exciting.
“The company has material exploration upside in Egypt, world-class fields in Kurdistan to be developed and is making progress towards successful resolution on its arbitrations.”
The company reported full year revenue of $392 million as compared to $417 million in 2015. The drop in revenue was due to lower realised liquid prices despite the increase in the group annual average production.
Total average 2016 production increased by 5% to 67,050 barrels of oil equivalent per day (boepd), from 63,900 boepd in 2015.
In the UAE, a final hearing to determine the damage claims against the NIOC (National Iranian Oil Company) for non-performance of the contract took place in The Hague on 3 November 2016, the company said.
A judgement is expected in 2017. This damage phase follows the first phase of the arbitration which was decided by the Tribunal's award issued in 2014 which confirmed the validity of the 25 year gas supply contract between NIOC and Crescent Petroleum.
