Dubai: Dana Gas recorded net profits of $31 million (Dh113 million) in the first nine months of 2020 compared to $69 million (Dh254 million) last year, brought on by demand volatility in energy markets.
It had taken an impairment charge of $243 million (Dh892.59 million) in relation to its Egyptian assets and a further $163 million (Dh598.73 million) impairment of goodwill following the sale of the company’s onshore assets in that country. Including these one-off expenses, Dana posted a net loss of $379 million (Dh1.39 billion) during the period.
“The company’s performance has remained consistently strong over the first nine months despite the current economic environment,” said Patrick Allman-Ward, CEO of Dana Gas, in a statement. “We also announced the sale of the company’s mature onshore Egypt producing assets and we look forward to completion early next year, which will allow us to further focus on our core world-class assets.”
Dana produced 63,000 barrels of oil-equivalent per day in the first nine months of 2020, realizing $30 per barrel for condensates and $28 per barrel of oil-equivalent (boe) for LPG. “The slight drop in output was due to reduced production in Egypt as a result of natural field declines,” the company said.
A company-wide effort to cut costs bore fruit, with general and administrative expenses down 18 per cent year-on-year.
The sale of the onshore Egyptian assets is a key part of Dana’s plan to strengthen its balance-sheet and focus on the development of its offshore block and assets in the Kurdistan Region of Iraq (KRI).
Dana Gas recently redeemed the $309 million of the outstandings it had on a sukuk it took in 2017. The sukuk had an original balance of $530 million, with $221 million of repurchases taking place during the last three years.