Premier Oil announce $214.6m pre-tax profit

PUBLISHED: Aug 28 2013 @ 06:20 | Comments (0) |

Premier Oil (LSE:PMO) has announced a 2013 half-year profit of $214.6m. Equating to a post-tax profit of $161.1m the company faced problems with its Huntington facility during the same period, though it saw positive news in regard to future plans involving the Falklands and six new Norwegian sites.

Commenting on the results Premier Oil’s CEO, Simon Lockett, argued that the firm was “placed to continue to deliver our target growth in the underlying value of the business. We have had one of our most successful periods for exploration with six discoveries from seven wells, material additions to the portfolio and significant maturation of high impact leads and prospects”.

Addressing the firm’s future plans and potential problems caused by rising costs Mr Lockett said that they were “actively managing our portfolio to focus on our operated development projects. Despite rising costs and challenging execution timetables across the industry, we see high returns on capital and strong cash flow growth as we deliver on these valuable projects”.

Results Highlights:

Operational

Production averaged 58,600 boepd (2012: 58,400 boepd) as previously announced; initial Huntington production issues addressed
Catcher project advanced, sanction expected by year-end; significant progress on Sea Lion project and forward plans for Falkland Islands
Six out of seven exploration wells successful, including significant oil discovery at Luno II in Norway
Three blocks awarded in Brazil’s 11th Bid Round; farm-in to UK Bagpuss/Blofeld area, potential high impact 2014 well
Delivering on portfolio upgrade: increased stake in Bream area; disposals in Vietnam and Norway

Financial

Record half-year financial results; continued growth in operating cash flow
Profit before tax of US$214.6 million (2012: US$194.6 million); profit after tax of US$161.1 million (2012: US$145.8 million)
Operating cash flow up 18 per cent at US$384.9 million (2012: US$325.5 million)

Outlook

Full year production target (63,000 boepd) depends on Huntington field performance in 2H
Pipeline of 2014 projects (Solan, Pelikan, Naga and Dua) in execution phase
Six wells planned for 2H 2013 including Kuda/Singa Laut in Indonesia and Luno II appraisal in Norway; offshore Kenya programme and Lama play in Indonesia to commence late 2013 or early 2014
Rising cash flows and strong funding position fully finance forward development spend, exploration programme and dividend plans

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