– Quarterly revenue increases 12% compared to 3Q 2008
– Quarterly Gross Profit increases by 64% compared to 3Q 2008
Sharjah, 12 November 2009
3 Months to September 30th 2009
Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, has announced its financial results for the quarter ending 30th September 2009.
Revenue from the sale of hydrocarbons increased to AED 359 million, with gross profit reaching AED 143 million. These figures represent increases of 12% and 64% respectively, compared to the same period last year, mainly due to new condensate sales from the Company’s operations in the Kurdistan Region of Iraq (which commenced in October 2008) and continued strong operations in Egypt.
Earnings before interest, tax, depreciation, amortization and exploration (EBITDAX) increased by 41% to AED 205 million as compared to the same quarter last year. However, exploration write-offs and impairment provisions, principally in respect of 3 wells in the Egyptian exploration program, were required totaling AED 110 million. As a result, the Company incurred a net loss of AED 79 million in the third quarter.
However, the above Income Statement results exclude an unrealized gain of AED 257 million in the quarter for the Company’s investment in MOL (the Hungarian oil and gas company, who are one of our partners in Kurdistan), booked directly to equity in line with the Company’s published accounting policy.
The “Comprehensive Income” for the 3 month period is AED 178 million.
9 Months to September 30th 2009
For the nine month period ending 30th September 2009, Dana Gas generated total revenue of AED 909 million, a gross profit of AED 308 million and a net profit of AED 281 million. Each of these represents positive increases compared to the same period for 2008. Earnings before interest, tax, depreciation, amortization and exploration (EBITDAX) also increased by 173% to AED 1,232 million, as compared to the same period last year. Note that these results exclude an unrealized gain of AED 293 million in the nine month period on the MOL investment, booked directly to equity.
The “Comprehensive Income” for the 9 month period is AED 574 million.
Dana Gas Egypt operations continued to contribute significantly to the results, producing 9.26 million barrels of oil equivalent (boe) year to date, an increase of 20% compared to the same period last year. The Company added two new gas discoveries in the Nile Delta, Sharabas-1 and Sama-1 in the quarter, taking the total to 7 discoveries out of 11 exploration wells during the nine month period.
Commenting on the quarterly performance, Dana Gas Chief Executive Officer, Mr. Ahmed Al-Arbeed, said: “Overall, we are pleased with the underlying results, reflecting strong performance from across the Company. Our Egypt exploration programme is continuing to yield discoveries and we expect to take the production rate close to 39,000 barrels of oil equivalent (boe) per day by the end of the year. Our exploration success ratio in Egypt of 64%, speaks for itself and our “successful efforts” accounting policy ensures we review well carrying values on a quarterly basis. The exploration expense in 3Q and the year to date reflects this. We look forward to announcing our reserve additions at the year end, following an independent review”.
“In the Kurdistan Region of Iraq, Dana Gas continues to supply gas to the Erbil power station and continues progress in constructing the LPG Plant” said Mr. Al-Arbeed.
“Our financial position continues to be strong and we maintain a good level of liquidity to manage our operational needs, plus our project and drilling expenditures, for the rest of this year, and going forward into 2010” he added.
31 Nov 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, was the main sponsor of Egypt’s First Business Summit on Climate Change, organized by the American Chamber of Commerce in Egypt (AmCham Egypt), in collaboration with the United Nations Development Programme (UNDP) Egypt which took place in Cairo on Wednesday 28 October 2009.
The global Summit focused on the dangers of climate change, its repercussions on the planet and on Egypt. It emphasized the importance of a joint public and private sector participation in combating this phenomenon. A number of distinguished international experts and high-level corporate representatives from several countries in the developed and developing world took part, with the aim of raising awareness and exposing companies to best practices on this important subject.
Foremost among these was environmental activist Al Gore, former Vice President of the US, and founder and chair of the “Alliance for Climate Protection”, who delivered the keynote address.
Also in attendance was H.E. Eng. Maged George, Minister of State for Environmental Affairs, Mr M. Gamal Moharam, President of AmCham Egypt and Chairman of MGM Financial & Banking Consultants Co., and Mr James Rawley, Resident Representative of the UNDP, and more than 1000 distinguished figures representing governmental agencies, diplomatic mission and influential business leaders.
Dana Gas was the patron of the event and cooperated with the American Chamber of Commerce in all aspects of the organization. In view of the attention that the company pays to environmental issues and sustainable development, Dana Gas was represented by its senior executives, including the Chairman, Mr. Hamid Jafar, the CEO, Mr. Ahmed Alarbeed, and the President of its Egyptian subsidiary, Dr. Hany Elsharkawi. Mr Hamid Jafar delivered the keynote speech, during which he highlighted the importance of companies within the energy sector working together to combat climate change. In particular he emphasized that although the ultimate solution to the climate crisis will eventually require the phasing out of all fossil fuels and increasingly important contributions from renewable energy sources, the most practical solution today is to promote as much as possible natural gas production, rather than the more polluting oil and coal.
Speaking of the importance of the summit, Mr Jafar said, “As the Middle East’s leading private sector natural gas company, Dana Gas is especially aware of the importance of combating climate change and is constantly working to improve the energy efficiency of its operations. Dana Gas is firmly committed to the Kyoto Principles and to playing an active role in benefiting our environment through a proactive approach to clean emissions solutions and other projects that may help stem the tide of climate change.”
“I believe that events such as Egypt’s Business Summit on Climate Change, which bring together the major players in a particular country and sector, are particularly important because they present a chance for like-minded individuals and organisations to come together to discuss and develop ever-more successful solutions to the environmental challenges facing us today,” Jafar added.
Dana Gas is working under a strategic alliance agreement with Eco Securities and Dubai Multi Commodities Center (DMCC) for the identification and development of Clean Development Mechanism (CDM) projects across the MENA region in particular and globally in general. The partnership aims to bring together the technical, commercial and financial expertise of the participating companies to work towards the goal of reducing the emissions from Oil & Gas and other energy industry sectors in a financially and socially sustainable manner. This unique strategic partnership also puts the UAE at the forefront of regional clean energy development and leads the way for emissions reduction in one of the most carbon intensive industrial sectors.
New discoveries from ‘Faraskur-1’ and ‘Marzouk-2’ wells
Sharjah – 13th October 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has announced two more significant gas discoveries – ‘Faraskur-1’ and ‘Marzouk-2’ – in one of its concessions in the Egyptian Nile Delta. Together, the two wells are expected to add 86 billion cubic feet (bcf) of gas to the company’s Egypt reserves.
The Faraskur-1 discovery, which is alone expected to add up to 73 bcf to the company’s Egyptian reserves, is located in the West El Manzala Concession. The well was spudded on 31 August 2009, reaching a total depth of 2,900 metres, on 27 September 2009. The well found 21 metres of gas in the Upper Abu Madi formation, and additional minor amounts in the Kafr El Sheikh and Lower Abu Madi formations. The Upper Abu Madi pay zone tested 12.2 million standard cubic feet per day (mmscf/d) of gas and 243 barrels per day (bbl/d) of condensate.
The Marzouk-2 well, also located in the West El Manzala Concession, was drilled to a total depth of 3,995 m and found gas in three zones. The upper zone, within the Messinian Abu Madi formation, yielded a gas and condensate discovery with a net pay of 6.7 metres and tested 10 mmscf/d of gas. The lower two zones, in the Sidi Salim formation, yielded non-commercial quantities of gas. Despite the non-commercial gas rates achieved from the two lowermost layers these findings are important to Dana Gas’s future exploration campaign in Egypt, as they prove the presence of an active hydrocarbon system in a formation where the company has determined the presence of several other prospects. The estimated reserves for the Abu Madi zone are 13.4 bcf.
Commenting on these new discoveries, Dana Gas Chief Executive Officer, Mr Ahmed Al-Arbeed, said, “The discoveries at the Marzouk-2 and Faraskur-1 wells represent the eighth and ninth discoveries from our 2008–09 drilling campaign in the Nile Delta. The extensive planning that went into the drilling campaign is continuing to yield very positive results, boosting Dana Gas’ production and profitability”.
Dr. Hany Elsharkawi, President of Dana Gas Egypt, commented on the development plans for these discoveries: “For the tie-in of Faraskour-1, two main options are currently under consideration: to connect the well to the Wastani field to the north-west, by crossing the Nile river, or to connect the well to the new plant (Salma-Tulip) to the south-east, which is currently the subject of a feasibility study. As to Marzouk-2, the well has been temporary abandoned and will be completed later. It will be available for production as soon as the Development Lease is granted.”
Dana Gas is the sixth ranking natural gas producer in Egypt, and ended 2008 with a daily production rate from its Egyptian operations of 31,640 boe, a figure that has already increased to over 37,000 boe this year. The Company has made a number of significant discoveries in the Nile Delta in Egypt during 2008 & 2009, in addition to the first ever commercial oil discovery in Southern Egypt made in 2007.
14 Sep 2009
Dana Gas PJSC, the Middle East’s first and largest private-sector gas company, has announced the appointment of James Dewar as Group Chief Financial Officer (CFO).
Mr. Dewar brings in over 27 years experience working in global/ regional CFO roles with British Petroleum (BP) Plc in the UK, Dubai, Kuwait, Indonesia, Singapore and the USA. Mr. Dewar is a Chartered Accountant from his time with Ernst & Young and holds a Bachelor of Arts honours degree in Accounting & Marketing from Strathclyde University in Scotland.
Ahmed Al Arbeed, Dana Gas Group Chief Executive Officer, welcomed Mr Dewar to the Group, saying, “I am pleased to announce the appointment of James Dewar as Group CFO, effective October 1st 2009. Mr. Dewar joins us at an important time to add executive and financial leadership to support the further growth and development of Dana Gas. We are confident he will add significant value to the company, utilizing his extensive global business and finance experience in Upstream, Downstream, Petrochemicals and Trading for the benefit of Dana Gas shareholders, business partners and employees.”
Speaking of the appointment Mr Dewar said, “I am delighted and honoured to be joining Dana Gas as Group CFO. I have watched the Company grow with interest since its inception and seen its phenomenal development over the past few years to become an increasingly successful energy company with interests across the MENASA Region. I look forward to working closely with Ahmed Al-Arbeed, the Board of Directors and the Dana Gas leadership team to contribute to the company’s continued growth and success through long term value delivery to its shareholders”.
Dana Gas recently announced its financial results for the second quarter of 2009, posting a net profit of AED 392 million and production figures of 3.19 million barrels of oil equivalent (MMboe) for the quarter.
Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, has announced its financial results for the quarter ending 30 June 2009, posting a net profit of AED 392 million for the second quarter, as compared to AED 34 million in the same period last year, and highlighting the strength of the Company’s operations and business development strategy in this challenging economic climate.
15th August 2009
Revenue from the sale of hydrocarbons reached AED 303 million, with gross profits reaching AED 97 million, an increase of 31 percent compared to the same period last year, mainly due to condensate sales from the Company’s operations in the Kurdistan Region of Iraq. For the six month period ending 30 June 2009, Dana Gas generated total revenues of AED 550 million, with a gross profit of AED 165 million, a net profit of AED 360 million and EBITDAX of AED 1,027 million, over three times the amount achieved in the same period last year.
Dana Gas’s Egypt operations contributed significantly to the excellent results, as it ended the quarter with a production of 3.19 million barrels of oil equivalent (MMboe) for the quarter. The coming on stream of the El Basant and Sondos fields pushed the Company’s production rate from 30,000 boepd to 37,000 boepd, and the Company’s new gas discovery and three successful appraisal wells also had an appreciable effect on its results. The Tulip-1 exploration discovery, located in the West Qantara Concession in the Nile Delta region, is expected to add approximately 27 billion cubic feet (bcf) of gas reserves, while the three successful appraisals – Sondos-2, El Basant-3 and Salma Delta-2 – confirmed expected reserves extension.
Two more exploration gas discoveries were made shortly after the end of the second quarter, Sharabas-1 and Sama-1 in the West Manzala and West Qantara concessions, respectively. The estimated combined reserves associated with the two discoveries are 76 bcf – 28 bcf gas for Sharabas-1 and 48 bcf gas for Sama-1.
During the period Dana Gas and Crescent Petroleum also signed an agreement with OMV Upstream International GmbH and MOL Hungarian Oil and Gas Public Limited Company, whereby the latter two companies purchased an equity interest in Pearl Petroleum Company Limited. The high-profile transaction resulted in PPCL being owned 40% by Dana Gas, 40% by Crescent Petroleum, 10% by OMV and 10% by MOL, and underpinned the companies’ thrust and access into the huge European gas market.
Speaking of the excellent results, Dana Gas Chief Executive Officer, Mr Ahmed Al-Arbeed, said: “Our numbers speak for themselves to the success of our operations. The second quarter of 2009 was marked by significant events for Dana Gas, particularly in the Kurdistan Region of Iraq, where we entered into strategic partnership agreements with two leading Central European integrated oil and gas groups – OMV, Austria’s largest listed industrial company, and MOL, Hungary’s largest listed company.”
“In Egypt, we continued with our exploration success and significantly increased our production rate, and I am very pleased to inform our shareholders that during the first half our production rate in Egypt increased beyond 37,000 barrels of oil equivalent per day (boepd), from 31,650 boepd at the end of 2008. The new Sama-1 discovery offers the Company an opportunity to achieve an additional production increase, which will push us up to 40,000 boepd,” Al Arbeed added.
Sharabas-1 and Sama-1 move the Company closer to its 40,000 barrels of oil equivalent per day production target 1st August 2009
Dana Gas, the Middle East’s first and largest private sector natural gas company, has announced two more gas discoveries at its concessions in the Egyptian Nile Delta: Sharabas-1 and Sama-1. These are the latest in a string of discoveries resulting from the company’s aggressive drilling campaign in Egypt, which began in 2008.
The Sharabas-1 discovery, located in the West El Manzala concession, tested at 7 million standard cubic feet per day (MMscf/d) of gas with 198 barrels per day (bbl/d) of condensate. The estimated reserves for this discovery are about 28 billion cubic feet (bcf) gas plus the associated condensate.
The Sama-1 discovery, located in the West El Qantara concession, tested at 13 MMscf/d of dry gas from a reservoir of Messinian age. The estimated reserves for this discovery are about 48 bcf gas. Based on the preliminary analysis of the testing data, the well has the potential to produce in excess of 20 MMscf/d of gas. A new 3D seismic survey is planned to better define the extent of this gas accumulation, with the potential to increase its reserves considerably. The dry gas nature of the hydrocarbons produced by Sama-1 well offers the opportunity for an early production start-up via a 30 km pipeline to the Company’s South Manzala plant.
Commenting on these latest discoveries, Dana Gas Chief Executive Officer Mr Ahmed
Al Arbeed declared: “We are very pleased that our Egypt exploration programme is continuing to yield discoveries. The Sharabas-1 and Sama-1 discoveries will boost Dana Gas’ production and profitability, and will take us closer to achieving our target production of 40,000 barrels of oil equivalent (boe) per day by the end of the year – a target that we are already well on the way to achieve. I am confident that the Dana Gas team will also maintain our excellent delivery rates and bring these discoveries on stream soon.”
Dr Hany Elsharkawi, President of Dana Gas Egypt said: explained that the exploration programme is continuing to progress well on all fronts. “In addition to the Sharabas-1 and Sama-1 exploration discoveries, Dana Gas has also successfully drilled and tested an important appraisal location at Salma Delta-2 in the West El Qantara concession, and good productivity has also been confirmed at the previously announced Tulip-1 discovery, also in the West El Qantara concession.”
Salma Delta-2 tested at 12.5 MMscf/d of gas with 352 bbl/d of condensate confirming the potential of at least 200 bcf of wet gas in this area, while Tulip-1 tested at 10.6 MMscf/d of gas with 252 bbl/d of condensate confirming a potential of about 27 bcf of wet gas.
Dana Gas is the sixth highest natural gas producer in Egypt, and ended 2008 with a daily production rate from its Egyptian operations of 31,640 boe, a figure that has already increased to over 37,000 boe thi.
Abu Dhabi Securities Exchange
Abu Dhabi – 15th July 2009
We have been notified by our partner Crescent Petroleum that they are seeking legal ruling on the gas supply contract with NIOC through international arbitration as per the 25- year agreement between them. this follows more than 42 months of delays in gas delivery by NIOC, and demands for performance from customers in the UAE. dana Gas, which has no contractual relationship with NIOC and whose role wii be in the UAE in processing, transportation, and a minority stake in the marketing operation for the imported gas, hopes for successful final resolution of all matters so that gas deliveries can finally commence on this important project, which will bring great benefits to the region’s economy.
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has announced that production from the recently discovered Sondos gas field has delivered outstanding results.
Sharjah – 11th July 2009
The Sondos field, found in the West El Manzala concession in Egypt’s Nile Delta region, was discovered in February 2009, with estimated gas reserves of 20 billion cubic feet, and was tested at 11.1 million standard cubic feet per day (mmscfd) of dry gas. It currently has two producing wells, “Sondos-1” and “Sondos-2”, delivering at an average daily rate of 12 mmscfd.
Commenting on the occasion, Dana Gas Chief Executive Officer, Mr. Ahmed Al Arbeed said: “Weare delighted with the new discovery, which is a new addition to the series of discoveries achieved by the company in 2008 and 2009 as a result of Dana Gas’ aggressive drilling campaign in Egypt. The drilling campaign achieved excellent results so far, promising to add momentum to the company’s 2009 production in Egypt”.
Mr. Al Arbeed added “The discovery of the Sondos gas field was particularly significant for Dana Gas, as it is set to push the company’s production rate beyond 37,000 barrels of oil equivalent per day (boepd) – its peak production rate for the first half of 2009 – compared to the 31,650 boepd on which the company’s Egyptian operations ended in 2008”.
The Sondos Field project’s schedule was fast-tracked, which took less than a month to complete. This was carried out by tying the two wells into the existing gas pipeline, to deliver the gas to the company’s South El Manzala Plant
On this occasion Dr. Hany El-Sharkawi, President of Dana Gas Egypt said: “The discovery of the Sondos Field was an exciting one for us, and serves as proof of the effectiveness of Dana Gas’ aggressive drilling campaign in Egypt. We are delighted with the results achieved in a short period which exceeded all expectations. These promising results will continue to boost the company’s production.”
In addition to its activities at the Sondos Field, Dana Gas has also increased gas production at its El Basant Field, following the successful completion of the “El Basant-3” development well in June 2009.
The Tulip-1 well represents the fourth discovery in 2009 for the company
Sharjah – 23 May 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has announced another gas discovery in one of the company’s concessions in the Egyptian Nile Delta. The Tulip-1 well is set to add up to 30 billion cubic feet of gas to the company’s reserves in Egypt.
This comes soon after the announcement of three previous gas discoveries in the Nile Delta area: two dry gas discoveries at the firm’s Sondos-1 and 2 wells, and one gas/condensate discovery at the Azhar-1 well. This is the result of Dana Gas’ aggressive drilling campaign in Egypt, which began in 2008 and continues to add new gas reserves in 2009.
The Tulip-1 well is located in the West El Qantara Concession, approximately 15 km from the Company’s South El Manzala gas processing facilities and 7 km from the recent discovery Salma Delta-1. The well was spudded on 25 April 2009 and reached a total depth of approximately 2200 meters within the Messinian Abu Madi formation.
The well encountered 11 meters of net pay in a good quality sandstone reservoir of the Abu Madi formation. The production test yielded production of 11.4 million standard cubic feet per day of gas and 318 barrels of condensate per day.
Commenting on this new discovery, Dana Gas’ CEO Mr. Ahmed Al-Arbeed said: “The discovery at the Tulip-1 well represents our fourth discovery in our 2009 drilling campaign. We are delighted that the extensive prospect generation effort, followed by a very effective drilling campaign, continues to produce positive results into 2009 following the outstanding results of 2008, which will further boost the company’s production”.
Dana Gas Egypt President, Dr. Hany Elsharkawi explained that the development plan for this discovery is currently being prepared. “The plan includes the drilling of a number of appraisal and development wells that will support the final assessment of the field and the construction of a new gas and condensate plant to accommodate the production coming from the nearby Salma Delta discovery as well”.
Dana Gas is the sixth highest natural gas producer in Egypt. The company ended 2008 with a daily production rate from its Egyptian operations of approximately 31,650 barrels of oil equivalent (boe) that has recently increased to about 35,000 boe due to the tie-in of El Basant field. A further increase is expected in June after the Sondos field tie-in.
Partnership set to invest US$8 billion in gas resource development and infrastructure; production potential of 3 BCF/day
Sharjah – 17th May 2009
Dana Gas PJSC, the Middle East’s first and largest regional private-sector natural gas company, and Crescent Petroleum, the Region’s oldest private exploration and production company, are pleased to announce strategic partnership agreements with OMV, Austria’s largest listed industrial company and a leading Central European integrated oil and gas group, and MOL Hungarian Oil and Gas Company, Hungary’s largest listed company and also a leading Central European integrated oil and gas group, which is set to transform the prospects for Iraq’s gas industry to become a major and secure gas supplier to local, regional and European markets.
Signed at the Companies’ head offices in Sharjah, UAE, by and between Badr Jafar, Executive Director of Crescent Petroleum, Rashid Jarwan, Executive Director of Dana Gas, Helmut Langanger, OMV Executive Board member responsible for Exploration and Production and Zoltan Aldott, Executive Vice President of MOL, the groundbreaking partnership is based upon OMV becoming a 10% shareholder in Pearl Petroleum, the company which holds Crescent Petroleum and Dana Gas’ upstream interests in the Kurdistan Region of Iraq, in return for a payment of 350 million US dollars, which in turn will be re-invested in the development of the project; and with MOL based upon around reciprocal shareholdings of their respective companies: MOL will become a 10% shareholder in Pearl Petroleum and Crescent Petroleum and Dana Gas will each become 3% shareholders in MOL, listed on the Budapest, Luxembourg and Warsaw Stock Exchanges. This arrangement unites the Middle East’s leading independent E&P companies with two of Europe’s most dynamic integrated oil and gas companies and the original architects of the Nabucco gas pipeline project.
These partnership agreements between the companies represents a significant vote of confidence in the investment policies and climate of the Kurdistan Regional Government of Iraq and illustrates the companies’ strong belief in the growth potential of the Kurdistan Region of Iraq’s natural gas assets to develop into one of the most significant gas export projects in the region within the next few years. In due course, this will establish Iraq as one of the region’s major gas exporters, once local requirements have been met.
Over the past two years Crescent Petroleum and Dana Gas have jointly invested 605 million US dollars in the successful fast-track development of the Khor Mor gas field and a local natural gas network, including construction of a 176km natural gas transmission pipeline in record time, efficiently enabling local gas-fired power generation plants to provide secure electricity supplies to over 4 million Iraqis, and reduce local oil consumption expenditure which in turn has led to savings in governmental fuel costs of approximately 2 billion US dollars per year. The project partners will now push forward with substantial new investments in the Kurdistan Region of Iraq estimated to be in the order of 8 billion US dollars to further develop the companies’ assets, and facilitate the provision of gas for increased Iraqi power generation capacity and encouragement of local Iraqi industry as a priority, and facilitating the subsequent exports of surplus natural gas into neighbouring countries, including Turkey and beyond into Europe, benefitting local, regional and European economies.
Badr Jafar, Executive Director of Crescent Petroleum stated “Our joint project in the Kurdistan Region now has the full potential of linking the Region’s significant gas reserves to Europe by pipe for the first time, after satisfying all local requirements of course. This will create very material investments in the Kurdistan Region of Iraq in the coming years, with significant employment opportunities and ancillary benefits for all of Iraq and Iraqis, and for the entire region.”
Zoltán Áldott, Exploration and Production Executive Vice President of MOL commented, “We are proud to enter into this ground-breaking partnership, which evidences our confidence and commitment to the policies and potential in the Kurdistan Region of Iraq. Today’s agreement combines the strengths of two leading Middle East energy companies with two leading central European energy companies, and is the first step in jointly pursuing our combined objectives and achieving major economic benefits for both regions. Through this strategic co-operation MOL strengthens the realization of the Nabucco project aimed to increase European gas supply security and complements its strong Central European gas midstream position to significant upstream natural gas sources. We very much welcome our two new strategic shareholders from the Middle East, who will support our business activities further with their extensive business relationships and profound oil and gas business knowledge to create further shareholder value in line with our strategy.”
Helmut Langanger, OMV Executive Vice President responsible for Exploration and Production stated: “OMV is very pleased to announce a long-term partnership between OMV, MOL, Crescent Petroleum and Dana Gas in this project. OMV now has the rare opportunity to participate in the appraisal, development and production of very large gas reserves close to the European market which has significant potential to serve as feedstock for the Nabucco pipeline. This transaction will significantly enhance OMV’s position within the Middle East especially as OMV sees the Kurdistan Region of Iraq as an important area for growth.”
Rashid Al-Jarwan, Executive Director of Dana Gas commented “Dana Gas and its partner Crescent Petroleum greatly look forward to these strategic partnerships with OMV and MOL, and of being constructive core shareholders in MOL. We are very pleased to have demonstrated that constructive reciprocal shareholdings such as these can cement co-operation in world-class private sector-led integrated energy projects, with a positive global impact.”
The announced partnership adds the final necessary component to fully realise the future export potential of this world-class energy project by creating a vertically integrated gas partnership from upstream, to midstream and to final gas markets based on the pooled, complementary strengths of the project partners. Both OMV and MOL are each 16.67% shareholders in the Nabucco project and the original architects of this major natural gas supply scheme. Some of these other key ingredients include:
– Significant gas reserve potential confirmed in the company’s assets, which can fulfil local and regional, including Turkish, gas requirements as well as substantial gas exports to Europe.
– Dana Gas and Crescent Petroleum’s proven local and regional expertise in developing all the necessary project facilities and infrastructure in record time.
– Increasingly positive relationships developing with neighbouring Turkey, which is an important gas market and an energy corridor into Europe.
– The companies’ gas project in the Kurdistan Region of Iraq is currently producing 90 million standard cubic feet per day of gas with associated condensate and LPG’s, and has potential for producing over 3 billion standard cubic feet of gas per day including substantial volumes of associated liquids by around 2014.
1. In April 2007 Crescent Petroleum and Dana Gas signed long-term agreements and a Strategic Alliance Protocol with the Kurdistan Regional Government of Iraq, to appraise, develop, process and transport natural gas from the Khor Mor Gas Field, and also to concurrently appraise the potential of the Chemchemal Gas Field for development, as part of a strategy to advance regional economic benefits through development of the region’s substantial gas resources. Khor Mor and Chemchemal are major gas fields in northern Iraq.
2. Dana Gas and Crescent Petroleum have invested 605 million US Dollars to date in the project, and are currently supplying some 90 million standard cubic feet per day to local power plants, with production and processing capacity on track to increase step-wise to 300 million standard cubic feet per day by the end of 2009.
3. Pearl Petroleum is the company which holds legal title to the upstream interests of both Crescent Petroleum and Dana Gas. Prior to the announcement of the above deal with OMV and MOL, Pearl Petroleum was owned 50% by Crescent Petroleum and 50% by Dana Gas. Following the deal, the shareholding of Pearl Petroleum will be as follows: 40% Dana Gas, 40% Crescent Petroleum, 10% OMV and 10% MOL.
4. The Nabucco project is a project linking Middle East and Caspian natural gas sources to Europe through a new gas transmission pipeline. The project is currently planned to have final capacity of about 3 billion cubic feet of gas per day, with completion of the first 1.5 billion cubic feet per day capacity phase around 2015. The shareholders in the Nabucco project, each with a 16.67% stake, are Austria’s OMV, Hungary’s MOL, Bulgaria’s Bulgargaz, Romania’s Transgaz, Turkey’s BOTAŞ, and Germany’s RWE.
About Dana Gas
Dana Gas (PJSC) is the first regional private-sector natural gas company in the Middle East, established with over 300 reputable founder shareholders from across the Gulf Cooperation Council (GCC) region, and some 300,000 investors from over 100 nationalities worldwide who submitted applications of over US$78 billion over ten days in the company’s regional IPO in late 2005. Headquartered in Sharjah in the UAE and listed on the Abu Dhabi Stock Market (ADSM), Dana Gas already possesses a network of offices in Saudi Arabia, Egypt, the UK, and Iraq, with further offices opening throughout the Middle East. Dana Gas currently has assets and projects in gas exploration and production, processing, transportation and marketing in the UAE, Egypt and Iraq, and aims to play a major role in the rapidly-growing natural gas business throughout the Middle East North Africa and South Asia (MENASA) Region across the entire gas value chain. In addition to its current projects, Dana Gas will be expanding its activities in all elements of the natural gas value-chain, including upstream exploration and production; through the midstream transmission and distribution of gas including LNG trading; and downstream into gas-related industries and petrochemicals.
About Crescent Petroleum
Crescent Petroleum is the oldest private exploration and production company in the Middle East, with over 40 years of experience as an international operator in numerous countries including Egypt, Pakistan, Yemen, Canada, Yugoslavia, Tunisia, Argentina, in addition to its continuing local operations in the United Arab Emirates. Headquartered in Sharjah in the UAE, Crescent Petroleum has international offices in the UK, Iran, and three locations across Iraq, as well as affiliated offices in Egypt, Canada, Saudi Arabia, 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.
With Group sales of EUR 25.54 bn and a workforce of 41,282 employees in 2008, OMV Aktiengesellschaft is one of Austria’s largest listed industrial companies. As the leading energy group in the European growth belt, OMV is active in Refining and Marketing (R&M) in 13 countries. In Exploration and Production (E&P) OMV is active in 17 countries on four continents. In Gas & Power (G&P) OMV sells approximately 13 bcm gas per year. Via Baumgarten, one of the most important turntables for gas in Europe, approximately 66 bcm gas is transported annually. OMV’s Central European Gas Hub is amongst the three largest hubs in Continental Europe. OMV is the leading energy group in the European growth belt with oil and gas reserves of approximately 1.2 bn boe, daily production of around 308,000 boe and an annual refining capacity of approximately 26 mn t. OMV now has 2,477 filling stations in 13 countries. The market share of the group in the R&M business segment in the Danube Region is now 20%. OMV further strengthened its leading position in the European growth belt through the acquisition of 41.58% of Petrol Ofisi, Turkey’s leading company in the retail and commercial business. In June 2006, OMV has established the OMV Future Energy Fund, a wholly owned subsidiary to support projects in renewable energy with more than EUR 100 mn to initiate the change from a pure oil and gas group to an energy group with renewable energy in its portfolio.
MOL Plc. is a leading independent, international and integrated oil and gas company in Central-Eastern Europe, headquartered in Budapest. It has operations in Europe, Middle East, Africa and the CIS member states and it employs over 17.000 people worldwide. MOL also owns 3 highly complex refineries in Hungary, Slovakia and Italy with a sales turnover of 18.1 mtpa and according to Wood Mackenzie global survey the refineries in Hungary and in Slovakia are the most efficient refineries in Europe. MOL operates over 1000 filling stations in Central and South Eastern Europe and is involved in the petrochemical business as well. At the end of 2008 MOL had 352.3 MM boe proved and probable hydrocarbon reserves and 86.3 M boe/day hydrocarbon production. The Group operates over 5,000 km high pressure natural gas pipeline network in Hungary and is also a key player in the regional transit transmission operations. Due to growth in gas consumption in the EU countries and the high level of import dependency, MOL focuses on the diversification of gas source and the development of infrastructure. MOL builds strategic underground gas storage, extends its import capacity and initiated regional interconnections (New European Transmission System – NETS) offering opportunities for regional expansion. On an international level, MOL has continued to participate in and support several infrastructure development projects (Nabucco) to diversify supply.
– Quarterly Gross Profit increases by 64% over same period last year
– El Basant field in Egypt commences production on 31 March 2009
Sharjah – 15th May 2009
Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, has announced quarterly results to March 31, 2009, posting revenue from sale of hydrocarbons of AED 247 million. This 9% decrease over the same period last year, from similar production volumes, is due to lower LPG and Condensate realized prices, though the relatively constant contracted gas prices received by the Company in Egypt has minimized this decrease Gross Profits, increased by 64% to AED 68 million compared to the same period last year, despite the decline in revenue mainly due to condensate sales from the Company’s operations in the Kurdistan Region of Iraq.
The Earnings before Interest, Tax, Depreciation, Amortisation and Exploration (EBITDAX) was positive at AED 113 million and reflects the positive cash generation by the Group during the first quarter. The Group incurred a net loss of AED 32 million in the first quarter after finance cost of AED 57 million and tax charge of AED 30 million as compared to a net profit of AED 25 million in the same period last year when the Company generated a profit from disposal of the Company’s interest in West Gharib concession.
Dana Gas’ oil and gas production in Egypt ended the quarter with a production of 2.66 million barrels of oil equivalent (MMboe) (31 March 2008: 2.65MMboe). The Company successfully brought the El Basant field on stream on 31 March 2009, thereby increasing production through its El Wastani gas plant in the Nile Delta region of Egypt to 170 million standard cubic feet of gas per day (MMscfpd) having. Total production in Egypt in April 2009 reached 35,000 barrels of oil equivalent per day (boepd), a 20% increase on the average rate achieved during 2008. This increase in production will be reflected in the Company’s results the second quarter of 2009.
In the Kurdistan Region of Iraq (Dana Gas 50% working interest) , gross gas production from the Khor Mor Field stood at 85 MMscfpd together with gross condensate production of 4,300 boepd which is being produced through Early Production Facilities (EPF) with gas being delivered to the power station at Erbil. Construction work is ongoing to complete the two train LPG facility at Khor Mor in late 2009, and drilling of a well on the Khor Mor Field is underway.
Commenting on the first quarterly results of 2009, Dana Gas Chief Executive Officer, Mr. Ahmed Al-Arbeed, said: “We have had a successful first quarter in which we had two exploration successes in Egypt, Azhar and Sondos, our exploration programme is continuing with four wells currently drilling.The El Basant field was successfully brought to production on 31 March 2009, just five months after its discovery and we plan to bring Sondos to production by end of June, only four months after its discovery, through Dana Gas’ South El Manzala Gas Plant. In Kurdistan the project for completing installation of a LPG recovery plant is progressing rapidly and we expect gross gas production in Kurdistan to increase to 150 mmscfd in the third quarter 2009 and eventually to 300 mmscfd later in 2009”.
Commenting on the Company’s domestic operations, Mr. Arbeed added “We expect the long awaited UAE Gas Project to start up in 2009 and our facilities in Sharjah our in a state of readiness to receive the gas. Fast track development of the Zora Gas Field in Sharjah is also ongoing and we plan to have first production in 2010 to supply further needed gas to the UAE local market”.
Al Arbeed: Dana Gas committed to expanding Egypt operations and investments in partnership with government, energy companies.
Sharjah – 13th May 2009
Dana Gas, the Middle East’s first private sector regional natural gas company, announced its intention to expand its gas operations and investments in Egypt’s growing natural gas industry. The company is associated in the leading conference for the natural gas industry in Egypt, INTERGAS V, which is held between 12th – 14th May 2009 in Cairo.
Recognized as the largest energy trade show for the Egyptian natural gas industry, INTERGAS V is attended by the leading international energy companies and expects more than 800 delegates with an interest in Egypt’s oil, gas, and petrochemicals sectors.
The opening ceremony featured remarks by Egyptian Minister of Petroleum Sameh Fahmy and Azerbaijan’s Minister for Industry and Energy Natik Aliyev and a keynote speech by Dr Hany El-Sharkawi, President Dana Gas Egypt.
Dana Gas is proud to be a major gas producer in Egypt, and is firmly committed to expanding its operations and investments in the growing Egyptian natural gas sector,” said Mr. Ahmed AlArbeed, Chief Executive Officer. “Through wise leadership and good energy policies, Egypt has doubled its natural gas reserves in the last five years to over 70 trillion cubic feet, and now produces more gas than oil and is already among the world’s top ten exporters of LNG.” AlArbeed added.
INTERGAS is the most important energy annual event in Egypt, and presents an excellent networking opportunity for all involved in the sector, and for companies and the Egyptian government to come together to examine and discuss opportunities moving forward, and we are proud to be involved in an event of this calibre.”
Dr. Hany Elsharkawi, President Dana Gas Egypt, added: “Egypt benefits from a large and growing domestic market for natural gas, as well as export schemes through both LNG and pipeline. We at Dana Gas are firmly committed to pursuing further gas investments in Egypt, in partnership with the national Egyptian companies and other energy companies from the region and internationally.”
Dana Gas, listed on the Abu Dhabi Stock Market, is currently the 6th highest gas producer in Egypt. The firm recently announced an increase in production through its El Wastani gas plant in the Nile Delta region of Egypt to 170 million standard cubic feet of gas per day (MMscfpd), after successfully bringing the El Basant field on stream on 31st March 2009. Dana Gas’s total production in Egypt is now running at 35,000 barrels of oil equivalent per day (boepd), a 20% increase on the average rate achieved during 2008, with a target of 40,000 boepd for the end of 2009.
Dana Gas provides updates on its Nile Delta operations
May 10 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has increased production through its El Wastani gas plant in the Nile Delta region of Egypt to 170 million standard cubic feet of gas per day (MMscfpd) having successfully brought the El Basant field on stream on 31st March 2009. Total production in Egypt is now running at 35,000 barrels of oil equivalent per day (boepd), a 20% increase on the average rate achieved during 2008.
A second well has been drilled on the Sondos dry gas discovery which has been completed and tested at 11.5 MMscfpd through a 32/64” choke. Work is now progressing to bring the Sondos discovery on stream through Dana Gas’ South El Manzala gas treatment facilities with production expected to start in June 2009. At the same time work is ongoing at the El Wastani gas plant with the objective of increasing throughput to 180 MMscfpd. These two projects will bring Dana Gas Egypt’s gas production close to 200MMscfpd.
The Company is proceeding with its aggressive exploration campaign and since May 2008 has completed the drilling of 10 exploration wells with 5 discoveries, with 4 wells currently drilling. During the first quarter of 2009 the Shahin and Narges exploration wells, drilled at a cost of $23 million, did not encounter commercial quantities of hydrocarbons and have been plugged and abandoned.
Commenting on the ongoing exploration programme and rapid build up in production, Dana Gas newly-appointed Chief Executive Officer, Mr. Ahmed Al-Arbeed, said: “This exploration programme is yielding excellent results and, although we have had two dry holes, our success rate remains well above the industry average. Bringing exploration discoveries on stream within just a few months of their discovery maximises their value and I am delighted that our team is being able to deliver this value so rapidly. Our target in Egypt is to be producing around 40,000 boepd by the end of 2009, an increase of more than 25% compared to the rate we achieved at the end of 2008.”
Dana Gas Egypt’s Country Director, Dr. Hany Elsharkawi, explained that the exploration programme is being progressed with great dedication and diligence. “The result of each well increases our substantial well data base which, in turn, enables us to refine our interpretation of the extensive 3D seismic volume and increase confidence in our choice of drilling locations. We have significant exploration potential in over 100 mapped prospects on our Concessions and we will continue to drill selectively whilst closely monitoring our finding costs. Part of our drive to save costs and increase efficiency in the Company has included diverting a drilling rig to our operations in the Kurdistan Region of Iraq where we are drilling on the Khor Mor and Chemchemal gas fields.” he said.
In Egypt, Dana Gas is the sixth biggest natural gas producer, while in the Kurdistan Region of Iraq its operations are producing 85MMscfpd of gas which are transported to a new power station at Erbil and help provide electricity in the region.
Appointments made by the Board in line with Company’s Corporate Governance Guidelines and SCA Corporate Governance Recommendations
Sharjah – 28th April 2009
Dana Gas PJSC, the Middle East’s first and largest private-sector gas company, has announced the appointment of Ahmed Al-Arbeed as Chief Executive Officer (CEO) of the Company, in line with the Company’s own Corporate Governance Guidelines and the Corporate Governance codes of the UAE Securities and Commodities Authority (SCA), which call for the separation of roles of the Chairman of the Board and the CEO. The appointments were nominated by the Chairman of the Board of Dana Gas, Mr. Hamid Jafar, and approved unanimously by the first meeting of the newly elected Board of Directors after the Company’s AGM held on the 22nd April 2009.
“The Board of Directors is pleased to announce the appointment of Ahmed Al-Arbeed as Chief Executive Officer, and we are confident that he will continue to add enormous value to the company, as he did in his position as Executive Director, Upstream and as a Board Member since the Company was established,” said Mr. Hamid Jafar, Chairman of the Board. “We are also pleased to announce Mr. Rashid Saif Al-Jarwan’s appointment as Executive Director of Dana Gas. Mr. Al-Jarwan has made an enormous contribution to the company in his role as General Manager and Board Member, and we are confident that his efforts in his new role as Executive Director will continue to benefit stakeholders. Both executives will also continue to serve as Members of the Board.”
Ahmed Rashid Al-Arbeed benefits from over 30 years’ experience in the international petroleum industry, and was named Executive Director, Upstream for Dana Gas in January 2008. Prior to joining Dana Gas, Al-Arbeed served as Chairman and Managing Director of Kuwait Oil Company (KOC), Board Member of the Kuwait Petroleum Corporation (KPC), Chairman and Managing Director of the Kuwait Foreign Petroleum Exploration Co. (KUFPEC), Managing Director of the “Kuwait Project” for re-introducing international oil companies to develop Kuwaiti oil fields, and Managing Director of the Privatization and R&D Programs of KPC. He holds a Bachelor of Science degree in Petroleum and Natural Gas Engineering from Pennsylvania State University.
“It has been my honor to have been involved with Dana Gas, in various capacities since its inception, and to have seen its phenomenal growth over the past few years to become a truly international energy company, with interests across the Region,” said Ahmed Al-Arbeed, adding: “I am honoured to have been appointed to the position of CEO – an opportunity for which I would like to extend my thanks to the Chairman and Members of the Board of Directors, and I look forward to contributing to the company’s continued growth and success in the future for the benefits of its shareholders.”
Rashid Saif Al-Jarwan joined Dana Gas as General Manager in February 2006, bringing with him a wealth of oil and gas industry knowledge and experience gained through almost 30 years in the ADNOC Group of companies, where he served as Deputy General Manager of Abu Dhabi Company for Onshore Oil Operations (ADCO), and General Manager of Abu Dhabi Gas Liquefaction Company (ADGAS). He was also appointed to the Dana Gas Board in January 2008. Al-Jarwan holds a Bachelor of Science degree in Petroleum and Natural Gas Engineering from Pennsylvania State University in the USA.
Al-Jarwan thanked the Dana Gas Board of Directors for the opportunity to serve as Executive Director of the company, saying, “I look forward to my new duties and responsibilities in this position, and to working together with the rest of the Dana Gas management team to ensure that the company’s many projects proceed smoothly.”
Dana Gas recently announced the appointment of Sheikha Hanadi Nasser Bin Khaled Al Thani, Abdullah Ali Almajdouie, and Nasser Mohammed Al Nowais to its new Board of Directors. The firm also recently held its third Annual General Meeting, where it outlined its key business achievements for 2008, including a ten percent increase in revenues and an eight percent increase in net profits, and reaffirmed its intention to continue to expand its operations throughout the region.
Apr 25 2009
Dana Gas PJSC, the Middle East’s first and largest private-sector gas company, has announced the appointment of three new members to its Board of Directors – Shaikha Hanadi Nasser Bin Khaled Al Thani, Abdullah Ali Almajdouie and Nasser Mohammed Al Nowais. The Dana Gas Board now has representatives from all GCC countries, as well as Lebanon and Egypt.
Speaking of the new appointments, Hamid Jafar, Chairman of Dana Gas, said: “On behalf of the Board of Directors, I would like to warmly welcome Shaikha Hanadi Nasser Bin Khaled Al Thani, Abdullah Ali Almajdouie and Nasser Mohammed Al Nowais as new Members of the Dana Gas Board. We are very pleased to have three people of such experience, knowledge and skill joining us, and I am sure that they will be an enormous asset to the company as we continue to expand our business development activities across the region.”
Shaikha Hanadi holds an Executive-MBA from London Business School and a Masters Degree in Economics from the University of London, and has published several research papers on macro-economic issues in the GCC. She is the founder of the Qatar Ladies Investment Company (now Amwal), and serves as a trustee on the Board of the Arab Women’s International Forum and the College of Business and Economics at Qatar University. She is also a member of the Advisory Board of the Arab Business Angels Network (ABAN), and a founding member of the Qatar National Competitiveness Council. In 2006, Shaikha Hanadi was named Woman CEO of the Year by the Middle East CEO Awards Institute; in 2007 she was named one of the 100 world’s most influential Arabs by Arabian Business magazine, and last year she was named one of the top 20 women role models in global banking and finance by the Financial Times.
Abdullah Ali Almajdouie is the President of the Almajdouie Group, and holds the position of Chairman for Almajdouie PSC Heavy lift Co. Ltd. (Bahrain), Almajdouie De Rijke Logistic Co., Maxx Logistics (Dubai), Star Marine Services (Dubai) and Shumua Al-Amal for Special Education & Rehabilitation. He is also a Member of the Boards of Arbah Capital Investment Company, Prince Mohammed Bin Fahad University and Makhazen (Abu Dhabi), and a Member of various other committees and professional and community organisations. Mr.AlMajdouie holds a Bachelor of Science Degree and MBA from the College of Industrial Management at King Fahad University for Petroleum & Minerals in Dhahran, KSA.
Nasser Mohammed Al Nowais is the Chairman of the Rotana Hotel Management Corp. Ltd., Managing Director of the Abu Dhabi Trade Centre and Chairman of Aswaq Management & Services. Among the positions he has held include Director General of the Abu Dhabi Fund For Development, Chairman of the Abu Dhabi National Hotels Company, Under Secretary for the Ministry of Finance, and Chairman of the Arab Insurance Group. Mr. Al Nowais holds a Bachelor of Science in Business and Public Administration from New York University.
All three new members thanked the Dana Gas Board, and expressed their pride in their appointment, and their confidence in the company’s continued success and achievement.
Dana Gas recently held its third Annual General Meeting, where it outlined its key business achievements for 2008, including a ten percent increase in revenues and an eight percent increase in net profits, and reaffirmed its intention to continue to expand its operations throughout the region.
Leading regional gas company looks to build on achievements
April 22, 2009
Dana Gas PJSC, the Middle East’s first and largest private sector regional natural gas company, outlined the key business achievements made by the company in 2008 at the Annual General Meeting (AGM), which took place today in Sharjah, and is looking ahead to the future with confidence.
Dana Gas Executive Chairman, Hamid Dhiya Jafar, told those in attendance that the Group is in excellent financial health and will continue to expand its operations as it has done since inception.
In line with its robust five year business plan and entry strategies within the MENASA Region, Corporate Guidelines were developed to exceed regional best-practice and meet international best-in-class standards. The company opened a new Head Office in Sharjah and increased its staff to about 500 in order to meet its ongoing and expanding operations.
In his report to the AGM, on behalf of the Board of Directors, Mr Jafar highlighted the company’s achievements for the past year, saying, “We have had an excellent year. The Company has become an important and highly visible player in the emerging energy infrastructure of the MENASA Region. Our focus remains unchanged from when we began three and a half years ago: to be a force for change as the region’s premier private sector natural gas company.”
Some of the achievements highlighted by Mr Jafar include achieving a year-end exit rate of 31,640 barrels of oil equivalent (boe) per day with a total annual production of 10.5 million barrels of oil equivalent (mmboe) in its Egypt operations, while its total (3P) petroleum reserves in Egypt increased by 84 percent from 86 mmboe in 2007 to 158 mmboe in 2008. Dana Gas also made five consecutive exploration discoveries in the company’s Nile Delta Concessions, one of which is now in production. The discoveries included Salma-1 in the West Qantara Concession, El Basant-1 and El Basant-2, and doubled Dana Gas’s Egypt reserves. In addition, the Ras Shukeir LPG recovery plant project – being carried out by an affiliate company, Danagaz, along with partners EGAS and APICORP – is currently under development on the Red Sea Coast, and is due for completion and production in late 2010.
Production on the project in the Kurdistan Region of Iraq – which involved the rehabilitation of a giant gas field, installation of new state-of-the-art production and gas processing facilities, and the construction of a 180 kilometer high-pressure gas pipeline to a newly constructed power station at Erbil to supply much needed electricity to the region – commenced in a world record time of just 15 months after implementation, and is set to treble to 300MMscfd in 2009, in addition to a significant quantity of petroleum liquids. The Kurdistan Gas City project was officially assigned a 461 million square foot site near Chemchemal by the Kurdistan Region Government, and Dana Gas is also making good progress with the Egyptian authorities to establish the Egypt Gas City.
Closer to home, Mr Jafar said the company was able to report positive progress on the UAE Gas Project, which involves the import of gas by the company’s partner, Crescent Petroleum, from the National Iranian Oil Company (NIOC) for processing and transportation and joint marketing by Dana Gas within the UAE. NIOC has completed constructing its upstream infrastructure in Iran, and has appointed a French contractor, IPEDEX, to complete its commissioning work. Dana Gas’s facilities are ready to receive the gas as soon NIOC’s work is completed. Dana Gas also completed its joint venture project with Emarat to own, manage and operate the Middle East’s first common user gas pipeline, which is already in operation, while the Zora Gas Field offshore Sharjah marks the company’s entry into the GCC upstream sector, with production from the project underpinned by a 25-year concession and expected to supply the domestic market from 2010.
Dana Gas ended the year in a healthy financial position, with revenues up ten percent from 2007 to AED 1.14 billion, cash from operations up 20 percent to AED 575 million, and an eight percent increase in net profit, which was up to AED 120 million. The company also invested over AED 1 billion in assets that will deliver robust growth for its shareholders.
Speaking of the growth plans and outlook for Dana Gas for the coming year, Mr Jafar said: “The natural gas sector continues to show extremely strong fundamentals despite the global recession. The MENASA Region is unquestionably the world’s largest player in hydrocarbon supply, with 45% of global gas reserves yet less than 20% of its supply. Additionally, the robust economic growth in recent years has transformed the Region into a major gas market in its own right with an estimated long term annual growth rate of between 6-7%. This positive long-term view of our industry has been enshrined in our robust five year business plan and entry strategies within our Region.”
He added that raising new sources of finance is now more challenging from both a resource and cost perspective, and that cash earnings are best retained for investments in support of the Company’s continuing growth and enhancing shareholder value. Mr Jafar concluded by stating: “Our goals for 2009 are to reach even greater heights than in 2008; they will undoubtedly be challenging, but we nevertheless look forward to achieving them.”
Shareholders at the AGM approved the audited accounts and the auditor’s report for the period ended December 31 2008. Ernst & Young were also reappointed as auditors to the company.
Sharjah – 5th April 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, is pleased to announce that it had started its first production from the recent gas & condensate Al Basant discovery in the West Manzala Concession in the Nile Delta region of Egypton March 31st, 2009.
Al Basant-1 well was discovered in October 2008 and tested at a rate of 23.5 million standard cubic feet per day mmscfd gas and 1027 barrels per day condensate. The Al Basant-2 appraisal well was subsequently drilled, completed, and tested in December 2008 and additional gas was discovered in a new zone which tested at 10.5 mmscfd gas and 150 barrels per day condensate.
Al Basant field gas reserves are currently estimated to exceed 123 billion cubic feet BCF. A third well, in the field is planned to reach an estimated target field production of 45 mmscfd before year end. The Al Basant discovery was developed on a fast track project with two pipelines; 6” and 12”, 17.5 kms each, to transport Al Basant production to El Wastani (EW) integrated gas plant which has a design capacity of 160 mmscfd and 7500 bpd of condensate and LPG.
The El Wastani plant is currently operating at 153 mmscfd gas and 5400 bpd of condensate and LPG. The fast track project was completed in a record time. The new gas production from Al Basant will allow testing the plant beyond its full design capacity and identifying the components that require modification, or upgrading, to maximize throughput while targeting production levels of 170 mmscfd.
The El Wastani East-2 side track well (EWE-2st) is Dana Gas Egypt’s first highly deviated/horizontal well in Egypt. The well was drilled and completed in March 2009 in the East El Wastani development lease in the Nile Delta region. Gas production from EWE-2st started on March 30th, 2009, at an initial rate of 4.5 mmscfd gas, which will increase after the well has been cleaned up. EWE-2st production is being processed in the company’s El Wastani plant facilities.
Dana Gas’ Upstream Executive Director, Mr. Ahmed Al-Arbeed, said that the company is very pleased with this latest success and will continue its aggressive drilling plan in Egypt in the year 2009. “The experience gained in the successful horizontal drilling of EWE-2st will have a positive impact on the company’s plans to further develop its existing fields where horizontal drilling is expected to enhance productivity. The company has now started production from the first gas discovery in 2008 and will continue its efforts to develop and produce the remaining three other discoveries; Salma, Azhar, and Sondos (Haggag) in 2009/2010”.
Further office openings planned throughout MENASA region
Sharjah – March 29, 2009
HE Sheikh Ahmed Bin Sultan Al Qasimi, Deputy Ruler of Sharjah and Honorary Chairman of Dana Gas, officially opened the new offices of Dana Gas, the first and largest regional and private-sector gas company in the Middle East, at an inauguration ceremony attended by the Board of Directors and senior management of the company.
Dana Gas, which is listed on the Abu Dhabi Securities Exchange, already has a network of four regional offices in three continents (Saudi Arabia, the Kurdistan region of Iraq, Egypt and the UK) and has business activities right across the wider Middle East region, North Africa and South Asia (MENASA). The Company, which currently employs more than 400 professional staff, plans to open additional offices throughout the MENASA region to enhance new business development and support existing projects.
Commenting on the occasion, Rashid Al Jarwan, General Manager of Dana Gas, said: “The opening of this new head office, together with our plans for additional offices, demonstrates our confidence in the future and our commitment to the region. We have a growing number of projects and business activities under development, supported by our network of offices and professional staff across the region. We are grateful to our Board of Directors and shareholders, for their continuous support for Dana Gas”.
New discovery from ‘Azhar-1’ well fifth in a row for the company
Sharjah, 23 February 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has announced another significant gas discovery in one of the company’s concessions in the Egyptian Nile Delta. The Azhar-1 well is set to add up to 100 billion cubic feet (16 million barrels of oil equivalent) to the company’s reserves in Egypt.
This comes soon after the announcement of a dry gas discovery at the West Manzala-2 well and three gas and condensate discoveries at the El Basant-1, El-Basant-2 and Salma-1 wells. Azhar-1 is the latest in a string of discoveries resulting from Dana Gas’s aggressive drilling campaign in Egypt, which began in 2008 and continues to yield results in 2009.
Commenting on this new discovery, Dana Gas Upstream Executive Director Mr. Ahmed Al-Arbeed said:
“The discovery at the Azhar-1 well represents our fifth consecutive discovery from our 2008 – 2009 drilling campaign. We are delighted that the extensive planning that went into the drilling campaign is continuing to yield such positive results, which will boost the company’s production and profitability.
“A preliminary estimate of the exploration reserves of Azhar-1 discovery is in excess of 100 billion cubic feet (bcf) of gas and additional wells are planned for other potential hydrocarbon bearing zones that might increase the total reserves up to 150 bcf gas.”
The Azhar-1 well is located in the West El Manzala Concession, approximately 10 kilometers from the Company’s El Wastani gas processing facilities, and was spudded on 6 December 2008, reaching a total depth of 3,150 metres in the upper Sidi Salim formation.
The well revealed 18 meters of net pay in a good quality sandstone reservoir of the Qawasim formation. The initial production test from an 18 meter interval yielded production of 15.1 million standard cubic feet per day of gas and 444 barrels of condensate per day through a 32/64” choke.
Dana Gas Egypt Country Director, Dr. Hany Elsharkawi explained that the development plan for this discovery is currently being prepared. “The plan includes the drilling of a number of appraisal and development wells that will be tied into the nearby pipeline, which Dana Gas is currently constructing, to connect the recent El Basant discovery to the El Wastani Field. We expect to start production from Azhar-1 during mid 2009, which will take the Dana Gas El Wastani plant to full capacity. The close proximity of this discovery to our existing plant and to the El Basant discovery enables us to bring these fields on stream quickly and comparatively cheaply.” he said.
The Azhar-1 discovery is the latest addition to Dana Gas’ Egyptian reserves, which doubled in 2008 due to a very successful drilling campaign. The continuing campaign is set to strengthen the firm’s foundation for further growth in reserves and production.
Dana Gas is the sixth highest natural gas producer in Egypt. The company ended 2008 with a daily production rate from its Egyptian operations of 31,640 barrels of oil equivalent (boe). The firm has made a number of significant discoveries in Egypt, including the first commercial oil discovery ever made in Southern Egypt.
His Excellency Dr. Ahmed Nazif, the Prime Minister of Egypt, met Mr Hamid Jafar, Executive Chairman of Dana Gas, at the Economist Conference’s Sixth Business Roundtable, a high-level symposium of which Dana Gas is the lead sponsor that was held on 16-17th February at the Grand Hyatt Hotel, Cairo under the patronage of the Prime Minister.
Cairo – 18th February 2009
The Roundtable, which was attended by the Prime Minister and nine members of his Cabinet, brought together leading businessmen, investors and key decision makers to discuss issues pertaining to the current economic situation in Egypt.
During their discussion, the Prime Minister praised Dana Gas’ efforts and commitment to its Egyptian operations and complimented the Chairman on the rapid results being achieved, noting in particular the several discoveries made during the past few months.
Mr Jafar also met Egypt’s Minster of Petroleum, Eng.Sameh Fahmy to discuss Energy issues of common interest and to talk specifically about the country’s future requirements as well as Dana Gas’s plans for its operations in Egypt. Mr Jafar advised the Minister of the latest plans being implemented by Dana Gas as well as current production and added that the support of the Egyptian Government has been a major factor in Dana Gas’ success in the country and assured that there is more positive news to be announced in the near future, which will add further value to the Egyptian economy.
Dana Gas, the Middle East first and largest private sector natural gas company, also presented its Gas Cities concept to the Conference, which it believes to be the optimum energy solution for the region. The company is committed to establishing Gas City Egypt.
Speaking at the symposium, Mr. Jafar said:
“Despite the challenges of being the most populous country in the Middle East/ North Africa Region, Egypt has made huge strides in the gas sector through the progressive policy of the Petroleum Ministry that both encourages investment and maximizes local benefit. Egypt has doubled its gas reserves in the past 5 years, and is meeting the needs of the large domestic market while also exporting gas through both pipeline and LNG, with over 60 companies active in its upstream sector.
“Dana Gas marked its entry to the Egyptian energy sector with the US$1.1 billion acquisition of Centurion Energy in 2007 – clear evidence of our confidence in the local investment climate. We have since made substantial targeted investments in exploration and development, which have yielded extremely encouraging results.
“We have doubled our reserves in Egypt, and announced our latest discovery just this morning. In addition, we are making investments in a new LPG plant in the Gulf of Suez.
“As a regional company, we are focused on local use and benefit from gas, and in this context are proud to be jointly developing with the Government the Egypt Gas City Project, which will increase the local benefit from gas through maximum job creation and investment for sustainable economic growth”.
Besides introducing the Gas City project, Dana Gas also aims to promote a range of Corporate Social Responsibility (CSR) initiatives, which eventually will become part of the firm’s development of a self-sustaining Gas City in Egypt.
Dana Gas is the sixth largest gas producer in Egypt and the only private sector company from the region to make significant hydrocarbon discoveries there in 2008. The company was also the first to make a commercial oil discovery in Southern Egypt and embarked on a significant drilling campaign last year, which exceeded reserve targets for the year.
New discovery from ‘West Manzala 2’ well is fourth in a row for Company
Sharjah, February 16
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has made its second gas discovery of 2009 in the West Manzala Concession in the Nile Delta region of Egypt. The discovery, named West Manzala-2 (Haggag prospect), has encountered approximately 20 billion cubic feet (bcf) of dry gas. The new well, which was spudded on January 18, is located a few hundred meters away from the gas sales pipeline leading from the company’s South Manzala gas processing facility.
Dana Gas’ Upstream Executive Director Mr. Ahmed Al-Arbeed, said that the company is very pleased with this latest success and will continue its aggressive drilling plan in Egypt in the year 2009. “The company has now had four gas discoveries in the last few months and we will continue with this fruitful exploration campaign,”
Al Arbeed said that the production from this discovery is expected to start during the second quarter of 2009. “This discovery can be brought on stream very rapidly as it is situated near the gas pipeline, which transports gas to the company’s South El Manzala gas processing facility. Drilling of additional appraisal and production wells within the Haggag prospect is also being considered,” he said.
The West Manzala-2 well (Haggag prospect), which was drilled to a total depth of 1,510 meters in the Kafr El Sheikh formation of Pliocene age, penetrated a total of 13 meters of net gas pay with two separate good quality sandstone zones of 8 and 5 meters thickness respectively. The production test, performed in the lower sand only, flowed 11 million standard cubic feet of dry gas through a 32/64” choke.
Dana Gas ended 2008 with a daily production rate from its Egyptian operations of 31,640 barrels of oil equivalent (boe). This most recent discovery follows the discoveries at El Basant and Salma adding reserves of up to 380Bcf of gas plus associated liquids
– Cash-flow from Operations increases by 20% to AED 575 million
– Net Profit for the year up by 8% during 2008
– Multiple discoveries have doubled Company’s Egypt gas reserves
– Total production increases by over 50% with start up of Kurdistan Project
– Long-term assets grow by 13% with total assets of AED 10.8 billion
Sharjah – 31 January 2009
Dana Gas PJSC, the Middle East’s largest regional private sector natural gas company, has announced preliminary results for the year ended 31 December 2008, posting revenue from oil and gas production of AED 1.14 billion, an increase of 10% over the previous year.
Earnings before Interest, Taxes, Depreciation, and Amortization (EBITDAX) reflecting cash flows from operations in 2008 increased by twenty per cent during the year to reach AED 575 million. Net profit for the year was AED 120 million, an annual increase of 8 percent, after finance charges of AED 263 million, non-cash depreciation and depletion of AED 301 million and income tax expense of AED 138 million during the year. Long-term assets grew by 13.4% during the year to reach AED 9.3 billion, while total assets as at 31 December 2008 stood at AED 10.8 billion, all related to its core business and with no investments or exposure to financial or property markets. At the end of 2008, Dana Gas cash and bank balances stood at AED 789 million, demonstrating a solid liquidity position despite the current financial crisis.
Operationally, Dana Gas’ oil and gas production in Egypt achieved a year end exit rate of 31,640 barrels of oil equivalent (boe) and ended the year with a total production of 10.6 million barrels of oil equivalent (mmboe), while significant new discoveries have more than doubled the Company’s petroleum reserves in the country. In the Kurdistan Region of Iraq, gas production commenced in the fourth quarter at a gross rate of 80 million standard cubic feet per day (MMscfpd), leading to a 50% increase in total operated production for Dana Gas.
“The year 2008 has been an excellent year for Dana Gas and we will continue to build on this important base in 2009, focusing as we always have on our core business area in the natural gas industry, which continues to show extremely strong fundamentals and growth opportunities, especially in our region in the Middle East, despite the slowdown in some other sectors.” said Hamid Jafar, Executive Chairman of Dana Gas. “We are on target to increase our production by over 70% in the coming year, and the majority of our revenues are currently from fixed long-term contracts which also offers some protection from volatile oil prices. We will continue our strategy of making careful and sound investments in this vital strategic industry, to deliver solid growth for our shareholders while benefiting the countries in which we work.”
Ahmed Al-Arbeed, Dana Gas Upstream Executive Director, highlighted some of the key business achievements during the past year: “One of the most notable achievements for the year was the delivery of first gas within a record time of 15 months in our major project in the Kurdistan Region of Iraq with our partner Crescent Petroleum, which resulted in an increase of over 50% in our gross operated volumes. In Egypt, we pursued a successful drilling program which yielded multiple discoveries in different areas of our Egyptian concessions, significantly enhancing the Company’s reserves with 362% reserves replacement, based on proved and probable reserves, for the year. In the UAE, Dana Gas completed its joint venture project with Emarat to own, manage and operate the Middle East’s first common user pipeline and began implementation of the exploration and development programme of the Western Offshore concession in Emirate of Sharjah which includes the development of the Zora Gas field.”
Mr Al-Arbeed continued: “In 2009 we will continue to implement our strategies for growth and expansion, focusing on capturing new opportunities through both acquisition and new project development. This year will Insha’Allah see the long awaited start up of the UAE Gas Project and fast track development of the Zora Gas Field in Sharjah, our production in the Kurdistan Region of Iraq will progressively increase to 300 million standard cubic feet per day, and work to bring our recent new discoveries in Egypt into production. We will also be continuing with further extensive developmental activities in all our projects.”
At year end Dana Gas gross operated gas production from operations in Egypt and Kurdistan Region of Iraq reached 220 MMscfd, with total hydrocarbon production exceeding 40,000 barrels of oil equivalent (boe) per day.
In Egypt, new discoveries have significantly enhanced the Company’s closing reserve position, and these were subject to independent professional evaluation, showing total (3P) reserves growing 82% to 157.7 million barrels of oil equivalent (MMBOE) as at 31 December 2008 (compared with 86.4 MMBOE a year earlier). The Company’s 2P (proven plus probable) reserves replacement ratio was 362%, with 2P reserves addition of 41%.
Dana Gas Finance Director, Neeraj Agrawal, elaborated on the Company’s financial results: “In the current financial and economic climate, Dana Gas has produced results that demonstrate solid growth and this reflects our focus on the strategic and expanding natural gas industry in our region. We successfully raised a billion dollars at the end of 2007 by issue of our convertible sukuk and continue to maintain a healthy liquidity position, with no exposure to the market downturn in real estate or financial investments.”
Mr. Agrawal added, “We entered 2009 with a cash and bank balance of AED 789 million which, along with the cash flow from operations in 2009, will facilitate the funding of our ongoing projects and servicing of the Sukuk.”
In the Kurdistan Region of Iraq, Dana Gas and its partner Crescent Petroleum were able to complete the 180 km gas pipeline to transport gas from the Khor Mor field to the Erbil Power Station in late September. The initial processing facilities were successfully installed with gas deliveries to the Erbil Power Station commencing on 1 October 2008 via the 180 km pipeline. The main LPG plant construction is in progress and the first train is expected to be put into production at 150 MMscfd by end of Q2, 2009 and the second train for an additional 150 MMscfd is forecast to come on stream by Q3 2009.
In Egypt multiple significant discoveries were made in different areas of Dana Gas’ concessions, which significantly increased the size of the Company’s hydrocarbon reserves. The most recent discovery was made in West Qantara Concession, Salma-1, which is expected to add up to 230 billion cubic feet of gas reserves (38 MMBOE) plus condensates. This discovery is in addition to the earlier rich gas discoveries in El Basant-1 and 2 that have added up to 160 billion cubic feet of gas (27 MMBOE) plus condensates. This accumulation is being developed on a fast track basis back to the Company’s existing facilities at El Wastani and will be commencing production during the first half of 2009.
The UAE Gas Project to process and transport imported gas is now in its final stages of completion. The construction and interconnection of the Company’s facilities in the UAE have long been successfully completed and are awaiting the commencement of gas supplies. The ultimate supplier of gas, NIOC, has completed the installation of all the main components of the required upstream facilities in Iran. Commissioning of these upstream facilities is currently in progress for the commencement of gas supplies upon completion.
Equipment and materials ordered, contracts to be awarded
Sharjah, 27 January 2009
Dana Gas, the Middle East’s first and largest regional private-sector natural gas company, is moving ahead with plans for the exploration and development of the Western Offshore concession in Sharjah.
This follows the signing of a 25-year concession agreement between Dana Gas and the government of Sharjah in March 2008, giving the firm a 50% working interest in the project. The agreement covers a total offshore area of over 1,000 square kilometres (386 square miles), and includes the Zora gas field in Sharjah, which was discovered in 1979.
Under the agreement, the work programme carried out by Dana Gas will include the drilling of 3,000 feet of horizontal section in each of the two wells originally drilled by Crescent Petroleum, testing and completing both wells, the installation of offshore platform for immediate processing and production, and the transportation of the processed gas via 25 kilometres (15 miles) of offshore pipeline. The agreement also provides for important exploration works within the concession area, including geological evaluation studies, followed by seismic surveys and the drilling of exploration wells.
According to Ahmed Rashid Al Arbeed, Executive Director of Upstream at Dana Gas, preparations for work on the concession area are well underway, and reservoir-related studies on the Zora gas field have already been carried out.
“We have retained the services of world-class reservoir specialists to conduct further detailed studies on the potential of the field, and generate the optimum development options,” said Al Arbeed. “We are in the process of placing orders for the equipment and materials necessary for the pipeline and production facilities, and are currently involved in negotiations with three major offshore rig contractors to supply a jack-up rig that will be used for tie-back, horizontal drilling, testing, and completion of the two wells.”
The Company is currently finalising selection of a major construction yard for fabrication of the wellhead platform jacket. The budgeted costs of the development phase of the Zora field are estimated at US$70 million, while costs for further exploration studies and work on one well are estimated at US$65 million from 2010 onwards.
This represents the latest achievement for Dana Gas, which has been expanding in all areas of the natural gas industry across the Middle East and North Africa region, including the upstream exploration and production of natural gas. The company is the 6th largest gas producer in Egypt, out of 64 companies operating there, and has recently doubled its reserves in Egypt after an extensive drilling programme in 2008 that resulted in several hydrocarbon discoveries. Dana Gas is also undertaking projects in the Kurdistan region of Iraq. Following the production of first gas in the Kurdistan region of Iraq earlier this year, in a record time of 15 months, Dana Gas’s overall operated gas production has increased by over 50 percent.
Salma-1 discovery set to add over 200 billion cubic feet of gas
Sharjah, 12 January 2009
Dana Gas, the Middle East’s first and largest regional private sector natural gas company, has announced that its current drilling campaign in Egypt has led to yet another significant gas and condensate discovery at its Salma-1 well in its Nile Delta Concession.
The news follows closely on last month’s announcement by the company of a significant discovery of gas and condensate reserves, estimated in excess of 130 billion cubic feet (bcf) of gas, at its El Basant-2 well, also in the Nile Delta Concession.
The Salma-1 well is the Company’s second well drilled in the West Qantara Concession, approximately 15 kilometres from Dana Gas’s South Manzala gas processing facilities. It was spudded on 1 December 2008, reaching a total depth of 2,231 metres. The first production test on the well was initiated before the end of December 2008. The well penetrated 25 metres of net pay in the good quality sandstone reservoir of the Abu Madi formation, and additional reserves are currently estimated to exceed 150 billion cubic feet of gas. An additional four metres of sandstone gas pay was encountered in the shallower Kafr El Sheikh formation.
“We are very pleased with the results of Dana Gas’s aggressive drilling programme last year, and the excellent results yielded by the Salma-1 well definitely call for more exploratory drilling in the area, where there are several similar prospects which we will be planning soon,” said Mr. Ahmed Al-Arbeed, Dana Gas Upstream Executive Director. “These discoveries have already achieved the ambitious targets we set for 2008 and will potentially double the Company’s reserves in Egypt, setting a strong foundation for further growth in reserves and production.”
Dr. Hany Elsharkawi, Dana Gas Country Director for Egypt, added: “So far, the first production test has produced 17.2 million cubic feet of gas per day and 415 barrels (bbls) of condensate per day through a 36/64” choke, giving a total of 3,280 barrels of oil equivalent (boe) per day. A second test in a shallower Abu Madi reservoir zone will be carried out once the first production test has been completed, and we are also preparing a development plan, which will include several appraisal and development wells for Salma-1,” Dr Elsharkawi continued: “A testing programme is currently underway to test all hydrocarbon potential zones for this discovery and determine the total volume of the new reserves in the area, which are currently estimated to exceed 200 billion cubic feet of gas.”
Dana Gas ended 2008 with a daily production rate from its Egyptian operations of 31,640 boe and an average annual rate of 28,900 boe. Dana Gas’ aggressive drilling programme in the past year has yielded multiple discoveries in different areas of its Egypt concessions, significantly enhancing the Company’s reserves. Consequently, both production rates and asset valuations are set to be enhanced in 2009.
Regional gas sector growing strongly despite global financial crisis
Sharjah, 6 January 2009
Dana Gas PJSC, the Middle East’s first and largest regional private-sector natural gas company, expects a strong year of growth in both production and operations in 2009, building on the Company’s significant achievements of 2008, when it achieved revenues of AED 901 million in the first nine months of the year, and grew production by over 50% with start-up of its major gas project in the Kurdistan Region of Iraq, and further discoveries in Egypt. The Company also stated that it has no exposure to real estate or stock market investments, and is in a solid cash position to fund its project requirements, having successfully raised $1 billion in a convertible sukuk in late 2007 despite a tightening credit market.
Speaking about the Company’s achievements and business outlook, Dana Gas Executive Chairman Hamid Jafar stated that 2008 was an excellent year for Dana Gas, and that the Company will continue to build on its important asset base in 2009, and already has major plans underway for the coming year:
“Looking forward to 2009, Dana Gas will continue to implement our strategies for growth and expansion, focusing on capturing new opportunities through both acquisition and new project development. This year will inshallah see the long-awaited start-up of the UAE Gas Project and fast-track development of the Zora Gas Field in Sharjah, while our production in the Kurdistan Region of Iraq will progressively increase to 300 million standard cubic feet per day, and our recent new discoveries in Egypt will also be brought into production, while we continue with further extensive developmental activities in all our projects.”
One of the firm’s most notable achievements for the year was the delivery of first gas in its major joint project with Crescent Petroleum in the Kurdistan Region of Iraq in a record time of 15 months. With an investment of US$650 million, the project is the largest private-sector investment in Iraq today and the largest private-sector oil and gas project in Iraq for several decades. The delivery of first gas enabled Dana Gas to announce in November that its production was up by over 50 percent.
In its Egypt operations, Dana Gas made a number of important gas discoveries as part of its extensive drilling campaign for 2008, most recently the important rich gas discovery last week in its El Basant-2 well, in addition to its oil discovery at El Baraka-2 and gas discoveries at El Basant-1 (El Tawil), with current discoveries already exceeding the Company’s target for new reserves in 2008. More discoveries in Egypt are expected soon, potentially doubling the Company’s 2008 reserve base. These results significantly enhance the economics of Dana Gas’s Egyptian assets, and will add materially to the Company’s overall gas and petroleum liquids production. In total, Dana Gas plans to increase total Company production rate by 76% in 2009, to 68 thousand barrels of oil equivalent per day by the end of 2009.
In addition, the Company will be starting the construction of the LPG recovery plant in Ras Shuqair, and will be conducting feasibility studies for other similar projects in Egypt. Dana Gas also has major plans for its Gas Cities concept, and is looking to expand business development of this important regional endeavour.
Closer to home, Dana Gas signed important agreements and completed significant projects in the UAE, including its joint venture with Emarat to own, manage and operate the Middle East’s first common user gas pipeline, the Hamriyah Gas Pipeline Project, which was completed and inaugurated in June 2008.
In March 2008, Dana Gas signed a 25-year concession for the Western Offshore Area of Sharjah, and to develop the Zora Gas Field within the block. The concession agreement covers a total area of over 1,000 square kilometres including the Zora Gas Field, which has established gas reserves and a ready high value market. The Company has begun implementation of this important project, which includes upstream development as well as transportation of the produced gas and petroleum liquids via a 25km offshore pipeline, which will add significant production and revenues to Dana Gas’s expanding diversified portfolio.
Executive Chairman Hamid Jafar explained that, financially speaking, Dana Gas’s focus for 2009 will be on optimising the Company’s capital structure and financing arrangements, and taking advantage of the opportunities that will present themselves over the next few months. He emphasized that the Company is in a healthy financial position, and its business has not been significantly impacted by the global financial crisis:
“I would like to reassure our stakeholders that the Company has diligently and professionally stuck to its core business in the utilization of its capital, and has not invested or speculated in the financial or property markets. Our core business is gas, and we are fortunate that the majority of Dana Gas’s current revenues emanate from gas production, processing, transportation and sales which have not been affected by the recent downturn of global oil prices. Therefore, our operations remain profitable despite the recent oil price decline. And despite the global economic downturn, the gas sector in the Middle East remains highly promising, and is continuing to show strong and sustained growth and opportunities for investment as a core sector. Dana Gas is thus in a unique position of both benefiting from and contributing to this healthy growth,” Jafar added.
The past year also saw Dana Gas establishing a robust five-year business plan and entry strategies for new countries, as well as recruiting high calibre industry professionals in the fields of engineering, geosciences, finance, legal and administration for its ongoing and expanding operations. The Company’s total manpower has grown to around 500 people, and still growing.
2008 also saw Dana Gas included in the Standard & Poor’s S&P Pan Arab Shariah Index and the S&P GCC Shariah Indices, Dana Gas was designated as ‘UAE Company of the Year’ in ACQ Magazine’s First Annual Country Awards for Achievement.