UAE's Dana Gas delivers Dh667m in 2022 net profit despite distractions at its KRI field
Dubai: UAE-owned Dana Gas, which operates fields in Egypt and Kurdistan Region of Iraq, recorded Dh667 million as 2022 net profit, against Dh1.16 billion a year ago.
If one were to exclude impairments and other income, the adjusted net profit would have been Dh718 million last year against Dh469 million in 2021.
Strong energy prices and demand helped drive Dana Gas numbers, while cost control measures also helped. All this while the company’s KRI operations were targeted twice by explosions, which, fortunately, did not result in any sort of damage to life or activity. (The company's KRI production reached a 'record' 500 MMscf/d in January 2023.)
In fact, “We managed to optimize our assets in the KRI, reaching record levels of production and increasing capacity by a further 50 MMscf/d following the completion of a by-pass sproduct,” said Dr. Patrick Allman-Ward, CEO. “The successful completion of the project in the KRI and our plans of maximizing production in Egypt will have positive impact on the environment as gas production displaces more carbon intensive fuels for power generation which will enhance the quality of life of residents in the KRI, Iraq and Egypt.”
Revenue rose 17 per cent to Dh1.94 billion in 2022 from Dh1.66 billion 'due to higher realized prices and production output in KRI. "Production in the KRI and Egypt remained uninterrupted throughout the year," the company said. Operational costs dipped 5 per cent to Dh209 million compared to Dh220 million in 2021.
On ADX, the stock is quoted at Dh0.86.
Egypt contract win
The company - the Middle East’s largest private sector natural gas company - also finalised an agreement with the Egyptian Natural Gas Holding Company (EGAS) for 'consolidation of its existing concessions on enhanced fiscal terms'. The new terms will extend the life of Dana Gas’ economic assets and help maximize value for stakeholders. (The agreement is subject to the Egyptian parliament rectification, expected later this year.)
Our operational performance, in which all our assets continued to produce uninterrupted throughout the year, even under testing economic circumstances and security challenges, exemplifies our ability to keep delivering on our commitments
Mixed outlook for 2023
“The outlook for this year remains encouraging, especially if oil prices remain at current levels," said Allman-Ward. "However, there remains various challenges, specifically with collections in the KRI and foreign currency withdrawals in Egypt.
"We remain vigilant as we look at our top priorities for the year, which are, in addition to securing timely payments, to develop the vast potential presented by our world-class assets in the KRI and maximize the value of our Egypt assets once the new concession consolidation agreement is ratified by the Egyptian parliament."