A “natural decline” in production and unplanned outages halved earnings from Taqa’s European business in 2018.
The Abu Dhabi-owned oil and gas operator released its full year financial results for 2018 yesterday, posting pre-tax profits of £331.5m.
European operations, which are comprised of oil and gas activities in the UK and Netherlands, made earnings before interest and tax of £188.9m, a drop of 51% from £285.9m in 2017.
It comes as oil and gas production in Europe was hit by “natural decline and unplanned outages”, dropping from 46,500 barrels per day in 2017, to 41,220 barrels in 2018.
However, Taqa Europe’s managing director, remained optimistic about the future, highlighting that 2018 was profitable and that UK assets maintained 90% reliability.
He said: “2018 was a safe and successful year for TAQA’s European business.
“We closed out the year with a strong safety performance and high asset reliability across our portfolio in the UK, with our northern North Sea assets consistently above 90% reliability.
“This, together with tight cost control, contributed to a financially profitable year.”
Mr Taylor also pointed to on-going work to extend the life of the Eider, Otter and North Cormorant fields, with the final phase of the £50m programme to be completed in “early 2019”.
Meanwhile, a decommissioning and development programme is taking place for its Pelican field east of Shetland, expected to continue into 2020.
Mr Taylor added: “We successfully delivered several projects designed to maximise future economic recovery from our northern North Sea assets.
“Following the redirection of production from the Otter field to TAQA’s North Cormorant platform and bypassing TAQA’s Eider platform in late 2017, these projects included ceasing production from Eider and installing a new multi-phase pump system at Otter to support and enhance production.
“The final phase will be the transfer of Eider to utility mode in early 2019.
“A mobile rig campaign commencing in March 2018 completed development and decommissioning scopes on the Pelican field and is expected to continue through 2019 and into 2020.
“Despite a capital and decommissioning budget approaching $400m for the year, we were able to generate significant positive cashflow.
“I am confident that we are well positioned for another successful year in 2019 with continued capital spend for the business and focus on safe and reliable operations.”