LONDON (Alliance News) - Volga Gas PLC on Monday reported a significant increase in profit in 2018, boosted by improved production and lower field operation expenses.
The stock was trading 11% higher on Monday morning at 54.80 pence a share.
The oil & gas exploration and production company reported pretax profit of USD10.6 million in 2018 compared to just USD168,000 in 2017, as revenue jumped by 24% to USD45.9 million from USD37.1 million.
Volga Gas proposed a final dividend of USD0.065 per share, taking the total payout to USD0.071, up from USD0.062 paid the year before.
During the recent year, the company said sales of crude oil and condensate rose by 0.8% to 649,541 barrels from 644,506 barrels in 2017, while natural gas sales improved by 1.5% to 6.471 trillion cubic feet from 6.378 trillion cubic feet. In addition, the company sold 6,904 tonnes of liquefied petroleum gas in 2018 versus none sold in 2017.
The company's gas sales were direct to Russia's largest energy company by revenue, Gazprom.
Volga's gas sales price during 2018 averaged USD1.99 per thousand cubic feet, down from USD2.06 per thousand cubic feet a year prior, with the decrease attributed to movement in the ruble to dollar exchange rate.
More positively, unit field operating costs were lower at USD4.61 per barrel of oil equivalent compared to USD5.46 the year before, also as a result of ruble devaluation.
"The improvement in profitability achieved in 2018 exceeded management's expectations and, in a stable oil price environment, would be sustainable," said Chief Executive Andrey Zozulya.
"We remain excited about the group's assets and remain positive about the potential for production from our fields and the potential to discover additional fields in our licences. We will also continue to seek value accretive opportunities, beyond our existing licence areas, building a focused exploration and production business," added Zozulya.
