Dana Gas PJSC has released its Q1 2023 financial results, reporting a net profit of AED 183M ($50M), a 7% drop from the previous year’s Q1 profit of AED 198M ($54M). Despite a 22% decrease in realized prices during the period, the company’s profitability was helped by a 14% reduction in operating costs and increased production in the KRI.
Revenue decreased by 13% to AED 447M ($122M) from AED 513M ($140M) in Q1 2022, mainly due to lower energy prices. In Q1 2023, the company’s realized prices for condensate and LPG averaged $59/bbl and $39/boe, respectively, compared to $82/bbl and $43/boe in Q1 2022.
In April, Dana Gas shareholders gave their approval to the Board’s proposal for a final dividend payment of 4.5 fils per share for H2 2022. This payment, which is set to be distributed on May 25, will bring the total dividend payment for the year 2022 to AED 630M or 9 fils per share. This represents a 12.5% increase over the dividend paid in 2021, according to WAM.
Dr. Patrick Allman-Ward, CEO of Dana Gas, commented: “Dana Gas has delivered a strong set of financial and operating results despite the downturn in energy prices. We remain financially disciplined and focused on maintaining production and lowering costs, despite the challenging economic situation in the KRI and Egypt. Our target date for completion of the KM250 gas expansion project is April 2024, and we are hopeful our Egypt consolidation agreement will be finalized soon Looking ahead we are focusing our efforts on managing capital expenditure and preserving liquidity, as we continue to focus on recovering our outstanding receivable payments with both the KRG and Egyptian Government”.
Operations & Production
Dana Gas Group’s production in Q1 2023 increased by 1% to average 62,900 boepd, compared to 62,400 boepd in Q1 2022. Production in the KRI grew by 9% to reach 38,700 boepd in Q1 2023, up from 35,400 boepd in Q1 2022, following the completion of Khor Mor plant enhancements in Q4 2022. However, production in Egypt declined by 10% to 24,200 boepd in Q1 2023 from 27,000 boepd in Q1 2022 due to natural field declines.
Dana Gas has completed the drilling of five KM250 project wells, and the testing of two of these wells has shown that they are capable of producing gas at similar daily rates as the current producing wells. The other three wells will be tested soon as the company works towards delivering first gas from the project by Q2 2024.
As of March 31, Dana Gas had a cash position of AED 542M ($148M), which included AED 374M ($102M) held by the Pearl Petroleum joint venture. In the first quarter, the company secured a short-term loan facility of $65M from a local UAE bank to boost its liquidity, and this facility was fully drawn in April 2023.
During the first quarter, the Group collected a total of AED 231M ($63M), with Egypt and the KRI contributing AED 55M ($15M) and AED 176M ($48M) respectively. The company’s receivables in KRI stood at AED 293M ($80M) and in Egypt at AED 128M ($35M) at the end of the quarter.
