TAQA profits surge to £219m

Investment of more than £250million in the UK North Sea helped to boost production, Abu Dhabi’s national energy company said yesterdayas it announced a 150% jump in profits.

TAQA said the rise in production in the North Sea and high oil prices helped revenue to rise 38% year-on-year to just over £1.18billion in the second quarter of 2011.

Pre-tax profits rose 151% to £219million.

TAQA, which operates UK North Sea assets through Westhill-based subsidiary TAQA Bratani, predicted more of the same on the back of recent completions, an acquisition and a farm-in during June.

Managing director Leo Koot said: “We have been investing £253million on the facilities to upgrade them to a point we think is good to operate for another 15 years beyond 2022. Then we have a drilling campaign at North Cormorant, Tern and Pelican ongoing. There is a lot of positivity around TAQA.

“We are bringing new wells on stream this quarter.”

However, he said just to stand still, the firm had to add an extra 15-20million barrels of oil a year to its reserves.

Mr Koot, who has been vocal about the Treasury’s oil and gas tax grab and uncertainty over the decommissioning cost tax relief, said the firm was committed to the UK and that it was always looking for more opportunities. He added, however, that there needed to be a more stable fiscal regime.

TAQA said production at its North Sea assets rose 27% to 40.1million barrels of oil equivalent per day, as a result of more efficient operations but also water-injection issues, which affected the 2010 figures.

Its Falcon field started production only last month so would not have shown in the latest figures.

TAQA also has an exploration well farm-in on Timor which it hopes to start drilling with partner MPX later this year.

In July it said it was taking over as operator of Otter and that it had completed the first phase of buying 81% of the field from Total. In June, it farmed into two of Wintershall’s North Sea blocks.