Skip to content Skip to Search
Skip navigation

Falling oil prices reduce Dana Gas profit by 25%

Iran is exempt from Opec cuts and its exports have been rising in 2023 despite US sanctions Wam
Increasing geopolitical risk in the Middle East should support oil prices and higher volatility can be expected, says analysts from ANZ Bank

UAE energy company Dana Gas said net profit fell 25 percent to AED304 million ($83 million) in the first half of 2023, compared with AED407 million in the first half of 2022.

The average price of Brent fell 25 percent to $80 per barrel in the first six months, down from $107 per barrel in the first half of 2022. The profit decline was also a result of additional discounts on condensate sales in the Kurdistan region of Iraq (KRI).

Revenue for the first six months dropped 22 percent to AED814 million from AED1.04 billion a year earlier because of lower realised prices amid softening global oil and gas prices.

Realised prices averaged $56 per barrel for condensate and $37 per barrel of oil equivalent (boe) for LPG in the first half, compared with $87 per barrel and $44/boe, respectively, in the same period the year before.

The impact of lower realised prices on the company’s profitability was partially offset by a production increase in the KRI and a decline in operating costs of 15 percent.

Pearl Petroleum, a consortium majority-owned by Dana, recently received $101 million from the Kurdistan regional government despite the ongoing challenges within Iraq. It is in ongoing discussions with the Kurdistan regional government to settle outstanding receivables as soon as possible, the statement said.

Patrick Allman-Ward, CEO of Dana Gas, said: “The first half results reflect the challenging environment hydrocarbon producers have been facing amid a decline in global oil prices.”

To counter the downturn in energy prices, the company strengthened its focus on maintaining production and lowering costs, while working with partner governments in Egypt and the KRI to settle outstanding payments.

“As oil prices have turned a corner and started to rise, we are optimistic about the potential positive impact on our company’s financial results for the remainder of the year, provided that this upward trend persists,” Allman-Ward added.

The company’s overall production averaged 59,800 boe per day in the first half 2023, a two percent year-on-year decrease from 61,100 boe per day, as a decline in Egyptian production outweighed an increase in the KRI.

Dana Gas’s cash position stood at AED370 million in H1 2023, including AED 301 million held at the Pearl Petroleum joint venture.

In May, Dana Gas received regulatory approval to increase foreign ownership. Foreigners can now hold up to 100 percent of Dana Gas’ shares, up from 49 percent.

Latest articles

Saudi sport

Saudi sports push ‘winning global audiences’

Saudi sports investments are winning a global audience as the kingdom tries to overcome charges of “sport washing”, a major survey of media coverage said this month. Media analytics consultancy Carma found that coverage of human rights in Saudi Arabia fell in favour of “a sports-related narrative” around the world, including in the West. The […]

Knight Frank predicts that the value of the Saudi Arabia's construction projects will grow to $181.5 billion by the end of 2028

Riyadh dominates Saudi Arabia’s construction market

Riyadh and its surroundings account for nearly 40 percent of the value of existing construction contracts in Saudi Arabia, at US$54 billion, according to new research. The provinces of Mecca – which includes Jeddah – and Tabuk in the north of the kingdom follow the capital region, with $28.7 billion and $28.5 billion in awarded […]

'We need to be extra cautious, but... also opportunistic', says Bahrain FinTech Bay CEO Bader Sater about the country's approach to crypto

Bahrain remains cautious but crypto pursuit advances

Bahrain will not sacrifice its position as a trusted financial centre as it chases cryptocurrency millions, according to the boss of fintech incubator Bahrain FinTech Bay. Earlier this month the kingdom’s central bank gave BitOasis Bahrain, a regional crypto trading platform, a so-called Category 2 crypto-asset services licence. The regulatory approval means that the broker-dealer […]

A money exchange centre in Cairo. The World Bank funding is intended to support private sector growth in Egypt

World Bank’s $700m push for Egypt’s private sector

The World Bank will provide $700 million in funding to Egypt to address short-term economic challenges. The development policy financing (DPF) will aid in supporting the Egyptian government’s focus towards more private sector participation. The financing will further advance structural reforms to level the playing field to support private sector growth, build macroeconomic and fiscal […]