Aberdeen oil and gas firm Dana Petroleum posted a 71% fall in annual profits yesterday after a £48.3million writedown from unsuccessful exploration and evaluation activity.
Revenue also fell – by 23% to £397.3million – but chief executive Tom Cross said he expected this to grow significantly this year on the back of higher oil prices.
Speaking after Dana announced pre-tax profits of £56.4million for 2009, compared with £191.4million the year before, Mr Cross said the business was poised to benefit from an unhedged price for its output of oil.
He added that the average price of oil was likely to be much higher this year than the $65-a-barrel the company budgeted for in 2009.
Dana, which focuses mainly on the North Sea and Egypt, said its proven and probable reserves had increased to 223million barrels of oil equivalent (mboe) by the end of last year. This compares with 194mboe at December 31, 2008.
Oil and gas production last year averaged 38,000 barrels of oil equivalent per day (boepd), which was not as good as Dana had expected but broadly similar to 2008.
It anticipates output of 37,000-41,000boepd this year.
Dana, which last year bought Bow Valley Energy for about £125million, is on the lookout for more acquisition targets.
Mr Cross said: “We put in place a $400million (about £267million) debt facility and have only used a small amount of that, so the company has plenty of firepower to do further acquisitions.”
Meanwhile, Edinburgh-based Bowleven said it was just weeks away from the start of a new drilling campaign on its Etinde permit offshore Cameroon.
Bowleven has already drilled four wells – all of them successful – on the permit, which comprises about 900 square miles of exploration acreage.
Chief executive Kevin Hart said the firm was on track for a May 1 start to further drilling on the permit and ready to tackle “one of the most exciting work programmes in its history”.
He added: “These are exciting times at Bowleven.
“The next 12-18 months are key to the evolution of the company as we endeavour to convert resources to reserves and explore the significant further exploration potential on our acreage.”
Legal formalities for farm-out of Etinde to Vitol Exploration and Production are almost complete, with only a presidential decree left to be signed.
Bowleven posted first-half results showing pre-tax profits of £1.02million for the six months to December 31, 2009, compared with £82.72million a year earlier. The firm currently has no revenue.
Other industry results yesterday showed Canadian oil and gas operator Antrim Energy, which focuses on the UK North Sea and Argentina, narrowed net losses to £8.4million during 2009 after the £8.7million deficit seen the year before.
Revenue grew to £8.65million in the latest period, compared with £8.04million previously.
The firm said that it expected to be active in the recently announced 26th UK offshore licensing round, building on the past success of acquiring “strategic and potentially high-impact properties” in the Greater Fyne area.