Dana Gas profit falls 12% on lower hydrocarbon prices

Reuters/Ahmed Jadallah

Profits at Abu Dhabi-listed Dana Gas fell 12.1 percent year on year to AED586 million ($160 million) in 2023 as a result of lower hydrocarbon prices.

However, the company reported a production increase in the Kurdistan Region of Iraq and reduced operating costs. 

Revenue decreased 20 percent year on year to AED1.55 billion. Operational costs fell seven percent annually to AED195 million, driven by cost control measures. 

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The average realised prices stood at $51 per barrel for condensate and $35 per barrel of oil equivalent (boe) for LPG last year, compared with $79 per barrel and $42 boe, respectively, in 2022.

Net production in the KRI increased eight percent to 36,900 boe a day in 2023. The increase resulted from the completion of enhancements to reduce bottlenecking at the Khor Mor facility.

Dana Gas anticipates the ratification of a consolidated concession agreement by the Egyptian Parliament in the first quarter of 2024. This agreement is set to extend the operational lifespan of its Egyptian assets, support its production levels, and include further investment of $100 million.

Pearl Petroleum Company, a 35 percent-owned subsidiary operating in KRI, continued to progress steadily on the KM250 expansion project last year. The unit expects completion of the KM250 project in the second half of this year.

“Looking ahead to 2024, we will continue to work with our government partners in the KRI and Egypt to ensure timely payments of invoices and to achieve another year of successful operations,” said Richard Hall, CEO of Dana Gas

Average group production declined slightly in 2023 to 58,700 boe per day, a two percent reduction from 60,200 in 2022. This was due to a 16 percent reduction in Egypt to 21,800 boe per day, as a result of natural field declines. This was offset by an eight percent increase in production output in the KRI to 36,900 boe per day compared with 34,300 boepd in 2022. 

As of December 31, 2023, Dana Gas’ share of KRI receivables stood at AED378 million, and its Egypt receivables stood at AED176 million.