Sharjah-based Dana Gas’ net profit jumped 483 per cent to $140 million (Dhs513 million) in first half of 2019 compared with $24 million (Dhs88 million) in the same period last year.

This was mainly due to the recognition at the fair value of certain reserve-based earn-out entitlements amounting to $71 million, the company said in its financial results for the first half ended 30th June, 2019, which were released today.

“These are due from certain shareholders in Pearl Petroleum as considerations linked to the original share sale agreements, which were contingent upon proving up additional reserves in Pearl Petroleum which were confirmed by the recent independent reserves report by Gaffney Cline,” it added.

Excluding the reserve based earn-outs of $71 million, net profit from core operations increased by 187 per cent to $69 million (Dhs253 million) versus $24 million (Dhs88 million) in H1 2018. This was principally due to an increase in Kurdistan Region of Iraq (KRI) production post debottlenecking which added $20 million (Dhs73 million), Sukuk profit savings and reimbursement of arbitration costs, reflecting the company’s solid operational performance.

Revenue for the first six months of the year advanced three per cent to $242 million (Dhs887 million) as increased production in the KRI added $27 million (Dhs99 million) to the topline which was partially offset by $15 million (Dhs55 million) in reduced revenue due to price declines, and $5 million (Dhs18 million) due to lower production in Egypt.

Dr. Patrick Allman-Ward, CEO of Dana Gas, said, “Dana Gas’ net profit of $140million in the first half 2019 is a clear reflection of the company’s strong operational and financial performance with strongly rising production and revenues from the KRI. An independent certification exercise has shown a 10 per cent increase in the company’s 2P reserves in the KRI to over 1 billion barrel of oil equivalent.

WAM