Key highlights from today's statement: http://www.stockopedia.com/news/announcement/DGO/090721dgo000270.htm
Operational update
- 11% increase in average daily production rate at 42,808 barrels of oil per day ("bopd") in 1H 2009 compared to 38,482 bopd in 1H 2008;
- Entitlement barrels in 1H 2009 at approximately 65% of the gross field production compared to 54% in 1H 2008;
- Two development wells came on stream in May 2009 at combined rates of 3,554 bopd and 2,628 bopd;
- Dragon Oil's own Rig 40 and the Iran Khazar rig expected to complete two wells by the end of July 2009;
- Contract for the Iran Khazar rig extended for another two years;
- Contract for part-time use of Astra jack-up rig secured to drill two wells commencing in Q4 2009.
Financial update
- Capital expenditure on infrastructure and drilling amounted to US$155 million for 1H 2009, similar to the level spent during the comparable period in 2008 (1H 2008: US$154 million);
- The Group's cash balance at 30 June 2009 was US$875 million (31 December 2008: US$876 million); unleveraged position maintained.
Dr Abdul Jaleel Al Khalifa, CEO, commented: "The first six months of 2009 were eventful for Dragon Oil both on the
operational and corporate fronts. Good progress was made with securing rigs to support our long-term drilling programme, but due to changes in the 2009 drilling programme and certain operational issues the average production for 1H 2009 was below our expectations. However, we remain committed to our drilling programme and expect to achieve up to 15% growth in annual production on average over the years 2009-11. Despite the volatility in oil prices and challenges in the broader economy, we maintained a strong financial position with a cash balance of US$875 million."
