Highlights
- Revenues up at $106mm (AED 389mm) based on a 9% increase in KRI production
- Group production reaches 64,900 boepd
- Full resumption of the expansion project at the Khor Mor field in KRI; investment by Pearl of $600 million to boost local gas production by almost 60% within 2 years
- Cash of $149 million (AED 546 mm)
- Cash dividend of $105 million (5.5%) approved by shareholders to be paid out by the 28th of May
Sharjah, UAE; 9 May 2021: Dana Gas PJSC (“Company”), the Middle East’s largest private sector natural gas company, today announced its financial results for the first quarter ended 31 March 2021.
Net Profit was up 41% in Q1 2021 reaching $24 million (AED 88mm) as compared to $17 million (AED62 mm) in Q1 2020. The increase in Net Profit was the result of improved revenues from higher production in the Kurdistan Region of Iraq (KRI), and a reduction in finance cost due to lower borrowings in Q1 2021 as compared to Q1 2020.
Revenue was $106 million (AED 389mm), 2% higher compared to $104 million (AED 382mm) in Q1 2020. The improved performance was mainly due to a 9% production increase in the KRI. Realised price averaged $44/bbl for condensate and $33/boe for LPG compared to $41/bbl and $30/boe respectively in Q1 2020.
Dr Patrick Allman-Ward, CEO of Dana Gas, commented:
“Dana Gas has delivered a strong quarter with robust operational performance, continuing the positive momentum from the previous period. In the KRI we are moving ahead with our expansion plans to significantly boost production from 440 MMscf/d to 690 MMscf/d by April 2023. This will contribute positively to our top and bottom line. We remain fully committed to managing our producing assets in Egypt for the benefit of all our stakeholders and focusing on evaluating the exciting potential of our offshore Block 6 Concession Area as quickly as possible.
“We maintained our strong financial position, with increased production from the KRI and lower financing costs following the repayment of the Company’s outstanding Sukuk in Q4 2020. I am pleased that we maintained the dividend to Shareholders, for the fourth consecutive year, despite adverse economic conditions.”
Production & Operations
Group production in Q1 2021 averaged 64,900 boepd, a 2% increase as compared to 63,650 boepd in Q1 2020. The first quarter production increase was driven by the KRI, which grew by 9% to 35,300 boepd from 32,400 boepd, building on the significant production increase in Q4 2020 after the Khor Mor plant by-pass project was completed in July 2020. Production in Egypt declined by 5% to 29,050 boepd, which was more than offset by the increase in production in KRI.
In the KRI, Pearl Petroleum, the company consortium operated by Dana Gas and Crescent Petroleum, fully resumed the expansion project at the Khor Mor field. The first gas train will add 250 million cubic feet per day of much-needed additional gas production to supply the local power stations. The project construction work had been put on hold due to the COVID pandemic but is now on track for a new target start date of April 2023, after agreement to lift the force majeure. The KM250 expansion project involves a further investment by Pearl of $600 million to boost output by almost 60%.
Last month, Dana Gas announced its decision to retain and operate its onshore assets in Egypt alongside the highly prospective Block 6. The Company is currently evaluating its Block 6 Concession Area for drilling an exploration well as soon as possible
Liquidity and Collections
Cash and bank balance at end of Q1 stood at $149 million (AED 546mm), an increase of 38% compared to $108 million (AED 396mm) at the end of 2020.
In the KRI, the Company collected $35 million (AED 128mm) during the quarter with all invoices due from the KRG being settled in full and in a timely manner. At the current oil prices the balance of KRI overdue receivables is expected to be settled by the third quarter of this year. In Egypt, the Company has collected $23 million (AED 84mm) during quarter one and its receivables at quarter end stood at $131 million (AED 480 mm).
At the General Assembly of the Company held on 28 April 2021, the Shareholders approved a cash dividend for the fourth consecutive year. This 5.5 fils per share dividend will be distributed in May.
—Ends—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe and average production of 63,200 boepd in 2020. With sizeable assets in Egypt, KRI and the UAE, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. Visit: www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Shareholders of Dana Gas PJSC (the “Company’), the Middle East’s largest regional private sector natural gas company, at the Annual General Meeting held yesterday, have approved the Board of Director’s recommendation to distribute a AED 5.5 fils per cash dividend for the financial year ended 31 December 2020.
Hamid Jafar, Chairman of Dana Gas, said:
“Dana Gas’ 2020 performance demonstrates the Company’s financial and operational resilience in the face of the challenging macro-economic environment and the unprecedented volatility in crude oil prices. As a result of the Company’s solid performance and the promising outlook as oil prices and markets recover, I am pleased the shareholders have approved the distribution of a dividend of AED 5.5 fils per share for the 2020 financial year at today’s AGM. The rebound in oil prices in the first quarter of the year will further support our robust financial position in 2021 as we continue to improve our operational capabilities.
The AGM concluded with the election of a new 11-member Board of Directors for the coming 3-year term. The new Board includes three new directors, namely; H.E. Younis Al Khoori, Undersecretary at the Ministry of Finance, Ms Najla Al Midfa, Chief Executive Officer of the Sharjah Entrepreneurship Center (Sheraa) and Mr Ajit Joshi, Managing Director, Head of Public & Private Markets, at Shuaa.
Mr Jafar added:
“I would also like to thank Messrs. Said Arrata, Abdullah Ali Almajdouie and Nureddin Sehweil for their service and valuable contributions during their long tenure and wish to welcome our newly elected Board members.”
—ENDS—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe and average production of 63,200 boepd in 2020. With sizeable assets in Egypt, KRI and the UAE, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. Visit: www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Investor.relations@danagas.com
US$600m investment to increase production 57% within 2 years
Production to grow from 440MMSCFD to 690MMSCFD by April 2023
Force Majeure lifted with KRG and US Contractor Exterran after COVID Delay
Dana Gas, the Middle East’s leading publicly listed regional natural gas company, and its partner Crescent Petroleum, the oldest private oil & gas company in the Middle East, have announced the full resumption of the expansion project at the Khor Mor field in the Kurdistan Region of Iraq (KRI), which the companies jointly operate on behalf of the Pearl Petroleum consortium. The KM250 expansion involves further investment of US$600 million to add 250 million cubic feet per day of much-needed additional gas production to supply the local power stations. The project construction work had been put on hold due to the COVID pandemic but is now on track for a new target start date of April 2023, after agreement to lift the force majeure with both the Kurdistan Regional Government (KRG) and the contractor.
Under a Gas Sales agreement signed in March 2019 with the KRG Ministry of Natural Resources, Pearl Petroleum will sell the additional quantities of gas to supply the power stations with affordable and environmentally cleaner fuel, and further enhance electricity supplies. Today over 80% of the KRI’s electricity generation is enabled by the gas produced by the companies.
Current production at the Khor Mor field is 440 million cubic feet per day of natural gas as well as 15,700 barrels per day of condensate and 1,020 tonnes of liquified petroleum gas (LPG), or a total of 110,400 barrels of oil equivalent (boe) per day, making it the largest overall producer in the KRI and the largest private sector upstream gas operation in Iraq. After the KM250 train, there are plans to add a further KM500 train which would take production to almost 1 billion cubic feet per day by 2024.
Total investment to date exceeds US$2 billion with total cumulative production of over 332 million barrels of oil equivalent (boe), which has resulted in significant fuel cost savings and economic benefits for the Kurdistan Region and Iraq as a whole. In addition 43 million tonnes of CO2 emissions have been eliminated by displacing liquid fuels, which in turn has made a positive contribution to tackling global climate change as well as reducing local air pollution. Mr. Majid Jafar, CEO of Crescent Petroleum and Board Managing Director of Dana Gas, commented: “After a year of delay due to the COVID pandemic, we are pleased to fully resume the KM250 expansion project to invest US$600 million and grow the gas production almost 60% within 2 years from now, supporting the local electricity provision even further. Despite the challenges the whole world has faced over the past year we have kept our operations safe and managed to grow production and we are grateful to all our staff and to the KRG for its support.”
Dr. Patrick Allman-Ward, CEO of Dana Gas, added: “With our partners in Pearl Petroleum we are proud to be investing further in the gas sector of the Kurdistan Region of Iraq, delivering a reliable source of cleaner energy, and supporting local economic development. The continuing receipt of payments in a timely manner gives confidence for our continued investment commitment as we enter the next exciting phase of growth with the Khor Mor expansion, which will be carried out under strict health protocols to ensure the safety of our staff and service providers.”
The Kurdistan Gas Project was established in 2007 as Dana Gas and Crescent Petroleum entered into agreement with the KRG for exclusive rights to appraise, develop, produce, market, and sell petroleum from the Khor Mor and Chemchemal fields in the KRI. Production from the newly built plant in Khor Mor began 15 months later, in October 2008, an industry record. In 2009, Pearl Petroleum was formed as a consortium with Dana Gas and Crescent Petroleum as shareholders, and with OMV, MOL, and RWE joining the consortium subsequently with a 10% share each.
Operation full-time staff numbers are over 500 with now over 85% local staff, including in senior management positions. And the companies have also implemented a corporate social responsibility program to support local communities with supplies to deal with the COVID pandemic such as ventilators, sanitizers and protection equipment. This is in addition to support with local education, health and power supply and other humanitarian aid for displaced persons and orphans. These initiatives are assisting the local communities in improving their standard of living, health, well-being, security and stability and the development of human capital.
—Ends—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe. With sizeable assets in Egypt, KRI and the UAE, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Investor.relations@danagas.com
About Crescent Petroleum
Crescent Petroleum is the first and largest private exploration and production company in the Middle East, with over 50 years of experience as an international operator in numerous countries including Egypt, Yemen, Canada, Tunisia, and Argentina, in addition to its continuing operations in the United Arab Emirates and Iraq.
Headquartered in Sharjah in the UAE, Crescent Petroleum has international offices in the UK and three locations across Iraq, as well as affiliated offices in Egypt and Bahrain. Crescent Petroleum is also the largest shareholder in Dana Gas, the Middle East’s first and largest regional private-sector natural gas company.
www.crescentpetroleum.com
Communications Contact
Mohamed Al Barazangi
SAHARA Public Relations
+971557163727
Sharjah, UAE; 25 April 2021: Dana Gas PJSC (the “Company”), the Middle East’s largest private sector natural gas company, today announced the termination of its agreement for the sale of its Egyptian assets, announced on 25th October 2020.
A number of conditions precedent to the transaction could not be completed to the satisfaction of both parties prior to the long stop date of the Sale and Purchase Agreement (SPA), which was Wednesday 14th April 2021. The Board has therefore decided to retain and operate the assets in Egypt alongside the highly prospective exploration acreage offshore Block 6.
As per ADX disclosure requirements, the Company is required to disclose the financial impact of this termination. While the Company is still assessing these in detail, it is expected that there will be positive consequences on the Company’s profitability and balance sheet and improvement in its cash flow in the coming years. These beneficial consequences result from the changed circumstances in the global economy and energy markets.
Dr. Patrick Allman-Ward, CEO, Dana Gas, commented:
“Dana Gas has worked diligently to finalise this transaction. However, satisfaction of the conditions precedent in the SPA proved problematic between the parties. Once the due date for satisfaction of those conditions expired, and after due consideration, the Company resolved to exercise the right to terminate the SPA in accordance with its terms.
“We have an excellent track record of operating in Egypt over the past 14 years. We remain fully committed to managing these assets for the benefit of all our stakeholders, including the Egyptian Government. We look forward to maximizing the value of both our onshore producing assets and focussing our attention on testing the enormous potential of our offshore Block 6 Concession Area where we are planning to drill an exploration well Q1 2023.”
—Ends—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe and average production of 63,200 boepd in 2020. With sizeable assets in Egypt, KRI and the UAE, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. Visit: www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Investor.relations@danagas.com
KRI production increased 9% in Q1
Invoices continue to be settled in full and in a timely manner
Sharjah, UAE; 20 April 2021: Dana Gas PJSC (the “Company”), the Middle East’s largest regional private sector natural gas company, announces that year-to-date Pearl Petroleum Company Limited (‘Pearl Petroleum’) has received $151 million (AED 553 mm) from the sale of gas, condensate and LPG, in the Kurdistan Region of Iraq (KRI). All invoices from the KRG continue to be settled in full and in a timely manner.
Dana Gas is a 35% shareholder in Pearl Petroleum and accordingly its share of KRI collections year-to-date is $53 million (AED 194mm). Of Pearl Petroleum’s total collections this year, $24.6 million was received in respect of overdue receivables, of which Dana Gas’s share was $8.6 million. Pearl Petroleum’s overdue receivables from the KRI stand at $42 million following the most recent payment, with Dana Gas’s share at $14.8 million. At the current oil prices the balance of KRI overdue receivable is expected to be settled during the third quarter of this year.
A significant production increase in the KRI occurred in the fourth quarter of 2020 after the Khor Mor by-pass debottlenecking project was completed in July. The Company has continued to deliver solid operational performance in the first three months of 2021. Gross gas production in the KRI increased by 12% to an average of 439 MMscf/d in the first quarter compared to 391 MMscf/d in the same period last year. This helped contribute to a 9% increase in total Group production to 35,300 boepd in the first quarter of 2021 versus 32,400 boepd in the first three months of 2020.
Dr Patrick Allman-Ward, CEO, Dana Gas, said:
“We are very pleased with the robust performance from our assets in the KRI in the first three months of the year, which at current oil prices will have a very positive impact on our profitability. Given the Kurdistan Regional Government’s continued commitment to pay down past receivables, we expect to receive the balance of overdue receivables from the KRI mid-year or shortly thereafter. Our achievements in increasing our production from the KRI over the past year and the sustained collections record gives us confidence in the continuing investments we are making in our future growth plans.”
—Ends—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe and average production of 63,200 boepd in 2020. With sizeable assets in Egypt, KRI and the UAE, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. Visit: www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Investor.relations@danagas.com
Highlights
– Production from all assets uninterrupted due to stringent health protocols in place
– KRI Q4 & FY production up 9% and 2% respectively
– $349mm in revenues despite lower realized prices
– Net Profit of $36mm (AED 131mm) before one-off non-cash impairments
– Entered into sale agreement on Egypt asset for up to $236mm; completion H1 2021
Sharjah, UAE; 11 February 2021: Dana Gas PJSC (the “Company”), the Middle East’s largest regional private sector natural gas company, today announced its Preliminary Unaudited Financial Results for the full year ended 31 December 2020.
The Company reported a Net Profit of $36 million (AED 131mm) versus $88 million (AED 322mm) in 2019, excluding one-off non-cash impairments and other income. Including these one-offs, the Company reported a Net Loss of $376 million (AED 1.4bn) versus a Net Profit of $157 million (AED 575mm).
A total of $412 million (AED 1,51bn) of impairments were incurred mostly related to the sale of Dana Gas Egypt onshore assets.
Dana Gas’s continued operations (Kurdistan Region of Iraq) contributed an annual net profit of $32 million reflecting the profitability of the remaining business despite the challenging year caused by the COVID-19 pandemic.
Revenue was $349 million (AED 1.27bn) in 2020 compared to $459 million (AED 1.68bn) in 2019 due to both lower realised prices and lower production in Egypt.
The Company’s robust, long-standing programme to control operating expenses helped to effectively navigate the challenging market environment in 2020. G&A costs were reduced by a further 20% year-on-year.
Dana Gas fully redeemed its outstanding Sukuk on schedule in October 2020. The Company closed the year on a strong financial footing, and maintains a positive financial outlook for 2021.
Dr Patrick Allman-Ward, CEO of Dana Gas, commented:
“The world experienced unprecedented shocks in 2020 with the COVID pandemic and its impact on the global petroleum markets with prices collapsing to levels not seen for over 20 years. Nevertheless, Dana Gas has shown real resilience both from an operational as well as financial perspective.
“When the pandemic struck, our first priority was the health and safety of our staff. However, we managed to keep our operations on-stream by implementing the most stringent health and safety measures. We not only managed to keep production levels up, but we also carried out a de-bottlenecking project on our Khor Mor plant in July which added a total of 50 MMscf/d of production capacity. In December we consistently obtained record production levels of over 440 MMscf/d. This extraordinary operational performance under the most testing of circumstances is testament to the commitment, dedication and hard work of our staff who have been outstanding in this challenging time.
“Despite the challenges imposed by the global 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.
“In 2021, we aim to advance the development of our world class assets in the KRI, where over 90% of Dana Gas’s proven reserves of over 1 billion boe are located, while concurrently moving ahead with our plans to prepare for the drilling of the next exploration well in Block 6 in Egypt, which holds exciting, material upside potential.”
Operations & Production
Average group production declined 5% during 2020, averaging 63,200 boepd versus 66,200 boepd in 2019. Production was boosted by a 2% jump in output from the KRI, which reached 32,250 boepd. This helped to offset a drop in production from Egypt, which fell 8% to 30,300 boepd versus 33,000 boepd in 2019 as a result of natural field declines. Fourth quarter 2020 average group production was up 2% to 63,600 boepd. The KRI added 9% to reach 33,250 boepd in fourth quarter production because of the successful completion of the plant bypass project.
The KRI and Egypt operations have continued without interruption and remain fully functioning, un-impacted by the Covid pandemic. The restarting of the expansion plans in the KRI demonstrates that all the parties working on the project are fully committed to executing the expansion project as quickly and as safely as possible. The Pearl consortium remains focused on completing the first 250 MMscf/d gas processing train in Q1 2023 and is also examining ways to bring forward the current schedule.
In 2021 the Company will prepare for the drilling of up to five development wells in the KRI which will begin the following year. It is also moving ahead on the evaluation of the highly prospective Block 6 in Egypt, interpreting the infill seismic data that was acquired in mid-2020 and planning for drilling the next exploration well in 2023.
Sale of Egypt assets
In October 2020 Dana Gas entered into a binding agreement with IPR Wastani Petroleum Ltd, for the sale of its onshore Egyptian producing oil and gas assets for a cash consideration of up to $236 million including contingent payments. The sale is on track for completion in H1 2021. The Company will retain its interests in its exciting offshore exploration concession, North El Arish (Block 6) which contains material gas resource potential in excess of 20 Tcf.
Liquidity and Collections
The Group’s cash balance at year-end stood at $108 million. The Board is considering transferring voluntary reserves into retained earnings to support dividend capacity subject to shareholder approval.
The Group collected a total of $182 million in 2020 (2019: $285mm) with Egypt and KRI contributing $80 million (2019: $138mm) and $102 million (2019: $139mm) respectively.
As of 31 December 2020, the Company’s Egypt receivables stood at $130 million (AED 477mm). In the KRI, regular payments have been received since March 2020. The KRG maintained its commitment to pay its invoices on time despite facing fiscal challenges throughout the year. Currently, $39 million is outstanding (DG 35% share). The Company has received notification from the KRG on the mechanism for settlement of the outstanding receivables.
—Ends—
About Dana Gas
Dana Gas is the Middle East’s first and largest regional private sector natural gas Company established in December 2005 with a public listing on the Abu Dhabi Securities Exchange (ADX). It has exploration and production assets in Egypt, Kurdistan Region of Iraq (KRI) and UAE, with 2P reserves exceeding one billion boe and average production of 66,200boepd in 2019. With sizeable assets in KRI and Egypt, and further plans for expansion, Dana Gas is playing an important role in the rapidly growing natural gas sector of the Middle East, North Africa and South Asia (MENASA) region. Visit: www.danagas.com
Communication & Investor Relations Contact
Mohammed Mubaideen
Head of Investor Relations
+971 6 519 4401
Investor.relations@danagas.com