Dubai: Privately-owned Dana Gas recorded a steep 59 per cent dip in net profit for 2020, totalling Dh131 million against Dh322 million a year ago.
It was set off by the COVID-19 pandemic, which wiped out demand for oil and gas in 2020, with US crude futures going below zero for the first time in oil market history in April. But Dana Gas officials are thinking ahead.
If impairment charges of Dh1.51 billion related to the sale of its Egypt onshore assets are included, Dana slips into a net loss of Dh1.4 billion.
"Despite the challenges imposed by the pandemic, we exited the year in a robust financial position with a strong balance-sheet, having agreed upon the sale of our Egypt onshore assets, redeeming our outstanding sukuk and entering into a new credit facility at a lower interest rate," said Patrick Allman-Ward, CEO.
“In 2021, we aim to advance the development of our world class assets in KRI (Kurdish Region of Iraq), where over 90 per cent of Dana Gas’s proven reserves of over 1 billion boe (barrel of oil equivalent) are located, while concurrently moving ahead with our plans to prepare for the drilling of the next exploration well in Block 6 in Egypt."
It is also moving ahead on the evaluation of the highly prospective Block 6 in Egypt, where it plans to drill the next exploration well in 2023.
Dana Gas produced 63,200 barrels of oil-equivalent per day in 2020, down 5 per cent from its output in 2019. But it did see a 2 per cent rise in production from its assets in the Kurdistan Region of Iraq and which helped offset output decline from Egypt.
It kept a tight lid on its expenses with its general and administrative costs (G&A) lower by 20 per cent year-on-year. "The company’s robust, long-standing programme to control operating expenses helped to effectively navigate the challenging market environment in 2020," the company said in a statement.