Oil&gas Regs Regulatory News (OGDC)

25 Oct 2007 08:16

Oil and Gas Development Company Ltd25 October 2007 Islamabad 25 October 2007 HIGHLIGHTS "OGDCL only" Un-Audited Financial Results for the Quarter ended 30 September, 2007-------------------------------------------------------------------------------- Oil and Gas Development Company Limited (OGDCL), (Ticker: OGDC), today announcesits financial results for the quarter ended 30 September 2007. FinancialStatements have been prepared in accordance with International FinancialReporting Standards. Highlights of the Quarter include: • Net crude production of 44,801 barrels per day (increase of 15.7% during corresponding period last year), net gas production was 926 MMcf per day (increase of 13.9% during corresponding period last year), net LPG production 364 tons per day (increase of 15.2% during corresponding period last year) and net Sulphur production was 69 tons per day (increase of 30% during corresponding period last year). • OGDCL's net sales increased by 9.8% to Rs 27,769 million from Rs 25,296 million. • Net profit before taxation stood at Rs 17,196 million. • Net profit after taxation stood at Rs 12,337 million resulting in earnings per share of Rs 2.87. • Operating profit margin and net profit margin were 60% and 44% respectively. • Payable first interim dividend of Rs 1.75 per share. • Average net realized price of crude oil sold was US $ 56.7/bbl as against US $ 60.3/bbl during corresponding period last year. • Average net realized price for natural gas sold was Rs 139.7/Mcf as against Rs 153.2/Mcf during corresponding period last year. • 555 L. Kms of 2D and 211 Sq. Kms of 3D seismic acquisition. Quarter ended 30 September 2007 1Q 2006-07 1Q 2007-08 % Rupees '000 Rupees '000 ChangeNet Sales 25,295,635 27,768,732 9.8Profit before Taxation 17,461,812 17,195,528 -1.5Profit after Taxation 12,327,803 12,236,860 0.1Earnings per Share - Rs 2.87 2.87 -Net Cash from Operating activities 12,513,476 13,153,683 5.1 OGDCL Consolidated Un-Audited Financial Results for the Quarter ended 30 September, 2007-------------------------------------------------------------------------------- Oil and Gas Development Company Limited (OGDCL), (Ticker: OGDC), today announcesits financial results for the quarter ended 30 September 2007. FinancialStatements have been prepared in accordance with International FinancialReporting Standards. Highlights of the Quarter include: • Net crude production of 44,801 barrels per day (increase of 15.7% during corresponding period last year), net gas production was 949 MMcf per day (increase of 16.7% during corresponding period last year), net LPG production 364 tons per day (increase of 15.2% during corresponding period last year) and net Sulphur production was 69 tons per day (increase of 30% during corresponding period last year). • OGDCL's net sales increased by 10.3% to Rs 27,927 million from Rs 25,322 million for the quarter. • Net profit before taxation increased to Rs 17,286 million from Rs 17,215 million for the quarter. • Net profit after taxation increased to Rs 12,399 million resulting earnings per share Rs 2.88. • Operating profit margin and net profit margin were 59 % and 44 % respectively. • Payable first interim dividend of Rs 1.75 per share. • Average net realized price of crude oil sold was US $ 56.7/bbl as against US $ 60.3/bbl during corresponding period last year. • Average net realized price for natural gas sold was Rs 130.8 / Mcf as against Rs 138.6 / Mcf during corresponding period last year. • 555 L. Kms of 2D and 211 Sq. Kms of 3D seismic acquisition. Quarter ended 30 September 2007 1Q 2006-07 1Q 2007-08 % Rupees '000 Rupees '000 Change Net Sales 25,321,637 27,926,861 10.3Profit before Taxation 17,214,713 17,286,013 0.4Profit after Taxation 12,036,692 12,399,484 3.0Earnings per Share - Rs 2.80 2.88 2.9Net Cash from Operating activities 10,983,581 13,291,002 21.0 Chairman's statement Commenting on OGDCL's First Quarter results ended September 30, 2007, theChairman and CEO of OGDCL, Mr. Arshad Nasar, said: "I am delighted to report on our successful first quarter results. The periodunder review was characterized by strong volume growth of 15.7% in oil and 16.7%in gas as compared to the corresponding period last year, thus translating intoa robust growth in sales of 9.8%." "During the period, OGDCL benefited from enhanced crude oil production resultingin sustained financial results and strong cash flow. Based on production growthtrend, we anticipate Company's overall performance to be in line with ourexpectations during the current financial year. We are also mindful of the factthat along with strong volume growth we must keep our operating costs undercheck and in control to maximize profitability." "I greatly value our work force and thank this exceptional pool of humanresource which is fully focused on achieving the challenging goals that we haveset ourselves to achieve by sheer and unrelenting dedication, commitment andzeal. I am sure that this bodes well for our Company and our stake holders." - Ends - For further information: Investor Relations Contacts Usman Bajwa Investor Relations Officer Telephone: +92 51 920 9888Fax: +92 51 920 9858Email: Usman_Bajwa@ogdcl.com Notes to Editors OGDCL is the largest petroleum exploration and production, or E&P, Group in thePakistan oil and gas sector, with a primary focus on gas. It holds the largestportfolio of the recoverable hydrocarbon reserves of Pakistan, at 32% of gas and30% of oil, respectively, as at 31st December 2006. It contributed 24% of thecountry's total natural gas production and 61% of its oil production as at 30thJune 2007 on net basis. With a portfolio of 42 exploration licences, the Group has the largestexploration acreage in Pakistan, covering 33% of the total awarded acreage as ofJune 2007. While its focus to date has been on onshore exploration, the Grouphas also recently begun conducting offshore exploration activities; an areawhich has significant untapped potential. OGDCL had a net profit after tax of Rs 45.25 billion for the year ended June30th, 2006. Summary Results During the quarter ended September 30, 2007, sales revenue of the Company grewby 9.8% to Rs 27.769 billion compared with 25.296 billion during correspondingperiod last year. This increase is mainly driven by higher sales volume of crudeoil, gas and LPG despite decline in net realized prices of crude oil and gas.Sales volume of crude oil, gas and LPG increased by 20.0%, 13.2% and 16.5%respectively which translated in increase of Rs 4.067 billion towards salesrevenue. Decline in oil and gas prices during the period resulted into decreasein sales revenue by Rs 1.961 billion. However sales revenue increased by Rs 322million on account of increased prices of LPG. During the period, net realizedprices of crude oil and gas averaged at US$ 56.7 / BBL and Rs 139.7 / Mcfrespectively compared with US$ 60.3 / BBL and Rs 153.2 / Mcf duringcorresponding period last year. Despite increase in sales revenue, profit before taxation decreased by 1.5% toRs 17.196 billion compared with Rs 17.462 billion in the same period last yearmainly due to payment of Rs 1.139 billion as royalty related to prior yearspertaining to condensate and LPG from Dhodak and Dakhni fields. Operatingexpenses also increased by 13.8% to Rs 3.758 billion compared with Rs 3.301billion during same period last year. Within operating expenses amount of Rs 297million increased on account of amortization and depreciation due tocapitalization of new well / assets and increase in production. Exploration andProspecting expenditure increased by 162 million mainly on account of highercost related to dry / abandoned wells. Profit after taxation for the first quarter ended September 30, 2007 was Rs12.337 billion against Rs 12.328 billion during same period last year resultingin earnings per share (EPS) of Rs 2.87 which is at par with the earnings duringthe corresponding period of last year. During the period under review net cash from operations after payment ofcorporate tax of Rs 4.741 billion was Rs 13.154 billion, an increase of Rs 640million over same period last year. Net cash used in investing activitiesdecreased by Rs 1.479 billion to Rs 2.524 billion against Rs 4.003 billion inthe same quarter last year mainly due to decrease of Rs 1.998 billion in fixedcapital expenditure which was Rs 2.946 billion in the quarter under review asagainst Rs 4.944 billion in first quarter of 2006-07. Net cash used in paymentof dividend was Rs 2.093 billion as against Rs 15.815 billion resulting in netdecrease of Rs 13.722 billion in cash used in financing activities. Increase incash flow from operating activities, and net cash utilized in investing andfinancing activities resulted in net cash increase of Rs 8.536 billion to endingcash balance of Rs 26.531 billion. DIVIDEND Directors of the Company are pleased to declare a first interim dividend of Rs1.75 per share (17.50 %) for the quarter ended September 30, 2007. PRODUCTION OGDCL's strategy of extensive exploratory and development drilling and ensuringsustained growth in its oil and gas production is firmly in place. During thequarter under review, the Company has witnessed a strong growth in its crude oilproduction which increased by 6,064 barrels per day compared with correspondingperiod of last year. Crude oil production from OGDCL's own fields and share inoperated Joint Venture fields increased by 21.6% mainly due to start ofproduction from Mela-1, Chanda-2 and Pasakhi North East-1 in addition toincrease in production from Kunnar, Bobi, Tando Alam and Dakhni fields. Share ofproduction from non-operated Joint Venture fields decreased by 9.2% resulting innet increase in crude oil production by 15.7% over same period last year.Company's gas production from own fields and its share in operated Joint Venturefields including production from subsidiary company increased by 25.4%. Thisincrease is mainly driven by enhanced production from Dakhni, Uch, Qadirpurfields, restoration of production from Loti and Pirkoh fields and start of gasproduction from Mela-1 and Chanda-2. Share of gas production from non-operatedJV fields decreased by 6.6% resulting in net increase in gas production of 16.7%over same period last year. LPG net production also increased by 15.2% duringthe period under review compared with same period last year. Company's average daily production including its share in operated andnon-operated joint venture fields was as follows: July - September July - September 2006 2007 Crude oil Barrels per day 38,737 44,801Gas MMcfd 813 949LPG M.Tons 316 364Sulphur M.Tons 53 69 o Daily production has been worked out at 365 days / year. o Gas production includes subsidiary Company production. (23 Mmscfd) EXPLORATION AND DEVELOPMENT ACTIVITIES During the quarter under review, OGDCL acquired two new exploration concessionsnamely Eastern Offshore-A and Shaan covering an area of 4,989.8 Sq. Kms. OGDCLis currently operator as well as working interest owner in 44 concessionscovering an area of 85,574.3 Sq. Kms and partner in another 5 concessionsoperated by other E&P companies. During the quarter 555 Line Kms of 2-D and 211Sq. Kms of 3-D seismic survey was acquired. The Company carried out drillingoperations on number of exploratory, appraisal and development wells spudded inthe later part of previous year. Three new exploratory / development wellsnamely Sono Deep-1, Sara West-2 and Qadirpur-30 were spudded in October 2007. During the period, OGDCL completed drilling of four development wells namelyTando Alam-18 & 20, Thora-6 and Qadirpur-29 in addition to workover job atQadirpur 27. Annual-Turn-Around (ATA) was completed at Uch, Dhodak and Bobi aspart of scheduled annual maintenance. Thora-6 well and Tando Alam-20 well werebrought into production during July-September 2007. Efforts are continuing toimprove and enhance the operational efficiencies of the producing fields.Development work on various current and future development projects is alsounder implementation and efforts are being made to complete these projects onaccelerated pace. An offshore well, Anne-1X, was spudded on October 1, 2007 in one of ournon-operated Joint Venture Block, Offshore Indus - E. M/s Shell is the Operatorof the block with OGDCL having a 30% working interest. The well is currentlyunder drilling. FUTURE OUTLOOK Company's strategy to grow through exploration and development with theobjective of securing oil and gas reserves and enhancing its production base isfirmly in place and we anticipate achieving the operational and financialtargets set in the business plan. Discoveries made during the recent pastcoupled with successful development drilling will further strengthen the oil andgas production base which will continue to generate strong operating cash flow.The strength of the Company's balance sheet will facilitate the Company toenhance its business canvas by availing the opportunities of acquiring overseasacreage by buying stakes in the existing viable producing fields and looking atpossibilities of E&P opportunities and joint venture collaborations outsidePakistan. The strategy of high impact exploration and development backed bystrong financial position will surely contribute to further development of theCompany and add significant value for our shareholders. We remain confident thatthe pace of growth will continue in the times to come. This information is provided by RNS The company news service from the London Stock Exchange