Faroe Petroleum H1 net loss GBP13 million
Staff Writer | September 20, 2016
Faroe Petroleum reported a H1 net loss of GBP13 million for the six months ended June 30, 2016, compared with a net loss of GBP6.7 million in the same period last year.Article continues below
This reflected a 55% drop in revenue to GBP23 million due to lower oil and gas prices as well as an 18% drop in oil and gas output to 9,030 barrels of oil equivalent a day. The decrease was mainly due to the planned suspension of Njord and Hyme in early June.
The average operating cost also rose to $25 a barrel of oil equivalent a day in the first half of the year from $23 in the first half last year, because of lower production from the Njord and Hyme fields due to maintenance and higher tariff charges on the Schooner and Ketch fields.
Faroe Petroleum raised its output forecast for this year to 16,000-18,000 barrels of oil equivalent a day from 15,000-17,000 barrels previously, reflecting a better-than-expected performance from the Trym, Brage and Oselvar fields, split between approximately 60% liquids and 40% gas.
The guidance includes output from its $70.2 million acquisition of four producing fields in Norway from Denmark's DONG Energy A/S (DENERG.KO), which is forecast to close in the second half of this year.
Faroe said 90% of second-half gas production has been hedged at an average price of 41 pence per therm and 66% of 2017 gas production has been hedged at an average price of 39 pence per therm.
The company had net cash of GBP60.9 million at the end of June following its GBP66 million equity issue earlier this year. ■ What to read next
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