By John Lee.
Shares in Genel Energy bounced 4 percent from a long-term low on Thursday morning following the publication of its results for the year ended 31st December 2014.
- 2014 revenue of $520 million, an increase of 49% on 2013
- 2014 EBITDAX of $411 million, an increase of 49% on 2013
- 2014 production of 69,000 boepd, an increase of 58% year-on-year with significant further growth expected in 2015
- Iraq budget passed into law in February 2015, enabling financial implementation of interim oil deal between the Kurdistan Regional Government ("KRG") and Government of Iraq
- Cash balances at 31 December 2014 stood at c.$490 million, with Genel highly focused on balance sheet strength to enable future investment and growth in the KRI
- To provide cash directly to contractors during the transition to regular payments for exports, the KRG has implemented a temporary domestic market sales channel under which contractors receive 50% of domestic sales proceeds:
- This has run successfully for Taq Taq through February 2015
- Taq Taq domestic price of $40-45/bbl equates to a Brent price of $50/bbl less transportation tariffs, reflecting strong demand for lighter barrels within the Kurdistan Region of Iraq ("KRI") domestic market
- Domestic market prices will be revised monthly in line with movements in international benchmarks
- Revenue and production guidance for 2015 maintained at 90-100,000 boepd and $350-400 million at a Brent price of $50/bbl
- On completion of gas deal, total working interest reserves and unrisked resources set to increase significantly