10th Jul 2014 06:53
LONDON (Alliance News) - Premier Oil PLC Thursday said its revenue in the first half of the year was about USD880 million, up from USD758 million in the first half of 2013, as production rose, although it will also book an after-tax charge of about USD30 million in its first-half accounts to cover future costs of abandoning the Balmoral area.
In a trading update before its releases its full half-year results on August 21, Premier said its production averaged 64,700 barrels of oil equivalent a say in the first six months of 2014, up 10% on the year and above the company's own target.
The oil and gas company said it is keeping its full-year production target of between 58,000 and 63,000 barrels a day, which reflects the planned summer maintenance period and the impact of the sale of its assets in the Scott area of the UK North Sea.
The estimated average oil price realised for the first half of 2014 was USD111.6 a barrel before hedging, up from USD110.5 a barrel a year earlier, and USD110.2 a barrel after hedging, down slightly from USD111.3 a barrel a year earlier. Those prices were above the average Brent crude price of USD108.93 a barrel in the period.
Its strong performance in the first half was driven by its UK assets, with production up 56% on the year to an average of 21,200 barrels of oil equivalent per day as it included the Huntingdon and
Rochelle fields.
Last month, Premier obtained UK government approval for its Catcher area field development plan, and it has now awarded all the major contracts for the project as it moves it towards the execution phase. Elsewhere in the UK, Premier said the re-development of the Kyle field is nearing completion.
However, the company also decided to sell its interests in the Scott area in the UK North Sea for USD130 million in the first half, part of a programme to monetise USD300 million of assets it thinks aren't core to its future business. It also sold assets in Indonesia and Norway during the period for USD57.5 million combined.
"In the second half, we will focus again on achieving our production targets, on the installation of the Solan facilities and on progressing the Sea Lion project," Chief Executive Tony Durrant said in the statement.
It kept its pretax full-year exploration spend expectation, and development spend before disposal proceeds expectation, unchanged at USD180 million and USD1 billion, respectively.
By Steve McGrath; [email protected]; @stevemcgrath1
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