Dana Gas posted very positive net profits for the second quarter of 2011 of US$34mn which is an increase of 276 per cent compared to the second quarter results last year.
Revenue from the sale of hydrocarbons increased to US$172mn , with gross profit reaching US$93.5mn. These are increases of 46 per cent and 90 per cent respectively, compared to the same period last year, according to a company statement.
Dana Gas attributed this growth to strong production growth coupled with higher market prices for oil, condensate and LPG during 2011.
Commenting on the performance, Dana Gas Chief Executive Officer, Mr. Ahmed Al Arbeed, said: "this excellent outcome is driven by the 20 per cent increase in production from Egypt and the Kurdistan Region of Iraq and consequent increase in revenues accompanied by our tight control of costs throughout the organization."
Production increased in aggregate by 20 per cent, from the company's operations in Egypt and in the Kurdistan Region of Iraq, where production from the Khor Mor field continues to increase.
Dana Gas Egypt's operations have continued to deliver strong results producing 4 million barrels of oil equivalent during the second quarter, an increase of 6 per cent compared to the same period last year.
During the period Dana Gas announced a new discovery at South Abu El Naga-2 in the West El Manzala Concession, which increased the estimated reserves by more than 60 billion cubic feet of gas. Importantly, this new pool will begin contributing to production by the end of 2011.
Dan Gas has continued work to optimise the development of the South Abu el Naga discovery and its discoveries in the Salma and Tulip area of its Nile Delta Concessions and now plans to expand the existing El Wastani gas processing plant, a more cost effective solution than building the previously proposed new plant at the Salma field. The new facilities will also increase recovery of LPG for the entire gas stream passing through the El Wastani Plant.
In the Kurdistan Region of Iraq, Dana Gas produced 1.84 million barrels of oil equivalent of gas, condensate and LPG during the period, an increase of 73 per cent over the same period in 2010.
Both trains of the LPG Plant at Khor Mor are now complete and in operational mode. Gas production from Khor Mor is increasing, and is now exceeding 300 million standard cubic feet of gas per day, as demand from the power stations increases and as new customers in the region are established.
In Sharjah Western Offshore Concession, an independent assessment of the reserves of the Zora field is close to completion. An invitation to tender for the fabrication and installation of the offshore platform has been issued and once all the contractual arrangements are completed, the project construction phase will commence. The total development cost of this field is estimated to be US$125-150mn.
Dana Gas discussed its attempts to get expedite payments of its overdue receivables in Egypt, and likewise in the Kurdistan Region of Iraq. Collection of receivables improved during the second quarter of 2011 compared to the first quarter. Dana Gas collected approximately US$57mn in revenues during the second quarter, US$35mn from Egypt and US$22mn from the Kurdistan Region of Iraq.
