Genel Energy Down 3% on Trading Update

Shares in Genel Energy were down 3 percent on Wednesday morning following the company’s trading and operations update in advance of the its full-year 2014 results, which are scheduled for release on 5 March 2015. The information contained herein has not been audited and may be subject to further review:

HIGHLIGHTS

  • A combination of low development and operating costs and Production Sharing Contract structure creates a robust Kurdistan Region of Iraq (“KRI”) oil business very resilient to sustained low oil prices
  • 2014 production of 69,000 boepd, an increase of 58% year-on-year with significant further growth expected in 2015
  • Capital expenditure guidance for 2015 lowered by 30% to $200-250 million, a reduction of 70% on 2014
  • Revenue guidance for 2015 revised from $500-600 million at a Brent price of $80/bbl to $350-400 million at a Brent price of $50/bbl
  • Cash balances at 31 December 2014 stood at c.$490 million, balance sheet strength underpins future growth in the KRI
  • Agreement on crude oil exports through northern Iraq reached in December 2014 between the Kurdistan Regional Government (“KRG”) and Federal Government of Iraq (“FGI”), operational implementation commenced in early January 2015
  • First payment for oil exports via the pipeline received in December, further payments expected shortly

PRODUCTION

  • Net working interest production for 2014 averaged 69,000 boepd, an increase of 58% on 2013 and at the top end of the 60-70,000 boepd guidance range
  • Gross production from Taq Taq averaged 103,000 bopd in 2014, an increase of 34% on 2013. Following the successful installation and commissioning of well site temporary production facilities in December 2014, Taq Taq set a new daily production record of 135,000 bopd and a new record for gross daily liftings of 147,000 bopd
  • Gross production from Tawke averaged 91,000 bopd in 2014, an increase of 131% on 2013
  • In 2014, 36% of Genel’s production was exported by the KRG through the KRI-Turkey pipeline system, with 12% exported by the KRG via Turkey by truck and the remainder sold into the domestic market
  • The Company’s 2015 production guidance is maintained at 90-100,000 boepd

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