20th Jan 2015 08:16
LONDON (Alliance News) - Dragon Oil PLC Tuesday said revenue and production increased during 2014, and expects further increases over the next two years, despite cutting its capital expenditure for 2015.
Total revenue for 2014 is expected to total around USD1.1 billion, a slight increase from the USD1.0 billion reported a year earlier. All the company's revenue currently comes from its operations in Turkmenistan.
It sold 13.5 million barrels of crude in 2014, up from 11.5 million barrels a year earlier. The higher volume sold over the year is mainly due to higher entitlement share of gross production. All of its crude was exported through Azerbaijan.
Average daily production increased by 6.8% during the year to 78,790 barrels of oil per day, from 73,750 barrels of oil per day in 2013. In December, the average daily production rate reached 89,680 barrels of oil per day with an exit rate of 92,008 barrels of oil per day.
Dragon has set a target to increase average gross production by around 10% in 2015, with a target of reaching 100,000 barrels of oil per day before the end of the year, which it wants to continue to increase in 2016 and maintain for at least a five year period, it said in a statement.
Dragon will drill between 15 and 20 wells in 2015 and 2016, dependent on the availability of rigs.
During 2014, the company spent a total of USD677 million in capital expenditure, over double the USD331 million spent in 2013. Of the total capital expenditure, 49% was attributable to infrastructure and 44% was spent on development drilling, with the balance invested in exploration assets.
In 2014, Dragon drilled a total of 14 development and appraisal wells, with all but one being sited on the Dzheitune (Lam) field in Turkmenistan.
At December 31, Dragon reported a cash balance of USD1.97 billion.
In 2015, Dragon has estimated it will spend between USD500 million to USD600 million in capital expenditure, mainly on infrastructure and development drilling in the Cheleken contract area, it said.
"In line with our diversification strategy, we continue to look for development or production assets as well as exploration opportunities in Africa, the Middle East and parts of Asia," said the company in a statement.
Dragon Oil shares were down 0.8% at 513.00 pence early Tuesday.
By Joshua Warner; [email protected]; @JoshAlliance
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