15th Mar 2016 07:36
LONDON (Alliance News) - Cairn Energy PLC on Tuesday said Senegal will be its key focus in 2016 and reiterated that its two large development projects in the North Sea remain on track as the company reported a narrower loss in 2015.
The FTSE 250-listed exploration company, which does not currently generate any revenue, said its pretax loss narrowed to USD497.8 million in 2015 from the USD559.1 million loss reported in 2014.
That was the result of unsuccessful exploration costs dropping during the year to USD97.4 million compared to USD208.4 million a year earlier, impairments falling to USD17.9 million from USD46.9 million, and lower pre-award costs and operating expenses.
However, those reductions were partly offset by a rise in impairments against its assets that are currently up for sale, which rose to USD318.6 million in 2015 from USD194.3 million a year earlier.
Cairn said its "key focus" in 2016 will be in Senegal, where it has recently made a discovery at its latest SNE-3 well and launched exploration drilling through the BEL-1 well. Cairn said its North Sea projects, Catcher and Kraken, both remain on track for delivery in 2017.
Cairn reported a net cash balance of USD603.0 million at the end of the year.
The company is currently carrying out its three-well exploration programme in Senegal, which Cairn said will cost around another USD100.0 million to complete.
Cash expenditure on development projects in 2015 amounted to USD114.0 million, and that is expected to rise to a total of USD465.0 million by the end of 2017 as the North Sea projects come online.
"As a result of its significant value potential, Senegal will be the key focus for Cairn in 2016. Our attention is on confirming the scale of our Senegal discovery, expanding the resource base and moving it towards commercialisation. Our two developments in the UK North Sea remain on schedule and on budget with first oil from 2017," said Cairn.
"This activity is set against a backdrop of a balanced, well-funded company with a continued focus on allocation of capital and resources. We are well placed to take advantage of this exciting opportunity," the company added.
By Joshua Warner; [email protected]; @JoshAlliance
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