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By John Lee.

Shares in Genel Energy were trading down around 5 percent on Tuesday morning, despite significant increases in revenue and profit announceed in its unaudited results for the six months ended 30 June 2022.

Paul Weir, Interim Chief Executive of Genel, said:

"Our cash generation in the first half of the year has been exceptionally strong - driven by our low-cost, high-margin oil production and disciplined capital allocation. We remain focused on the delivery of our long-established strategy of putting capital to work to grow our production and cash generation, while retaining our resilience and paying a material and progressive dividend.

We generated $129 million in free cash flow and are well on track to generate over a quarter of a billion dollars of free cash flow for the full year. This continues to build our balance sheet strength and optionality, providing us with the funds to add the right assets at the right price. Our cash flow this year benefits from the recovery of receivables and our override payments, and we are focused on replacing these by building a portfolio that supports the resilience, sustainability, and progression of our material dividend."

Results summary ($ million unless stated)

1. EBITDAX is operating profit / (loss) adjusted for the add back of depreciation and amortisation, impairment of property, plant and equipment, impairment of intangible assets and reversal of impairment of receivables
2. Free cash flow is reconciled on page 8
3. Reported cash less IFRS debt (page 8)

Summary

• Material cash generation from low-cost and high-margin oil production:
  • Net production averaged 30,420 bopd in H1 2022 (H1 2021: 32,760 bopd)
  • Low production cost of $4.4/bbl and strength of oil price delivered a margin per barrel of $32/bbl (H1 2021: $20/bbl)
  • Free cash flow of $129 million (H1 2021: $22 million)
• Financial strength provides options for capital allocation:
  • $75 million of capital expenditure in H1 2022, of which $41 million was spent at Taq Taq and Tawke, and $27 million on Sarta appraisal
  • Genel took on operatorship at Sarta on 1 January 2022, with Sarta-5 and Sarta-1D subsequently being completed
  • Cash of $412 million (31 December 2021: $314 million)
  • Net cash of $141 million (31 December 2021: net cash of $44 million)
• A socially responsible contributor to the global energy mix:
  • Zero lost time injuries ('LTI') and zero tier one loss of primary containment events at Genel and TTOPCO operations
    • Two million work hours since the last LTI, as we seek to repeat the performance of six years without an LTI up to September 2021
  • As we mark 20 years of operations in the Kurdistan Region of Iraq ('KRI'), the Genel20 Scholars initiative has launched, with Genel funding the opportunity for 20 economically disadvantaged students to have a life-enhancing education at the American University of Kurdistan

Outlook

• Production guidance for 2022 maintained as around the same level as 2021, currently tracking between 30-31,000 bopd for the full-year
• 2022 capital expenditure guidance of between $140 million and $180 million tightened to $150 million to $170 million
• Genel expects free cash flow of over $250 million in 2022, pre dividend payments
• Appraisal at Sarta is ongoing, with results of the Sarta-6 well expected around the end of the year
• The Company continues to actively pursue new business opportunities, focused on production and cash generation
• The London seated international arbitration regarding Genel's claim for substantial compensation from the KRG following Genel's termination of the Miran and Bina Bawi PSCs is ongoing
• Interim dividend retained at 6¢ per share:
  • Ex-dividend date: 15 September 2022
  • Record date: 16 September 2022
  • Payment date: 14 October 2022

Full results here.

(Source: Genel Energy)

Genel Energy has announced that after discussions with the Board following the recent AGM, at which Bill Higgs did not receive the required 50% majority of votes in favour of re-election as a Director, he has agreed to step down as CEO of the Company with immediate effect.

Dr Higgs will take up a role as Special Advisor to the Chairman until 1 September 2022, to support an orderly transition, after which he will remain as a consultant to the Company.

Paul Weir, COO, has been appointed as Interim CEO with immediate effect. A search for a suitable replacement is now ongoing and an announcement will be made in due course.

Paul joined Genel in January 2020, having worked for more than 30 years in upstream E&P with experience in the North Sea, South East Asia and Africa. Before joining Genel, Paul was Group Head of Operations and Safety at Tullow Oil, having previously spent 13 years at Talisman as VP Production and Exploration, and also worked in a variety of roles at Nippon Oil, Elf, Occidental, and Total.

David McManus, Chair, said:

"Bill worked tirelessly at Genel and oversaw a positive change in the strategic direction, operational capability, and culture of the Company. He steps down as CEO with Genel well positioned to utilise our robust balance sheet and material cash generation to fund growth and underpin our material and progressive dividend for the long-term.

"Paul has been a key contributor to the transition of Genel into an operator with interests in more producing assets than any other IOC in Kurdistan, and, given his longstanding operational experience with a range of world class companies, is perfectly placed to lead the team as it seeks to progress its next phase of growth."

(Source: Genel Energy)

Weir Oil and Gas Approved to Deliver OPITO - Accredited Qualifications in Iraq

Weir Oil & Gas has successfully achieved accreditation from OPITO, the global skills organization for the energy industry, to provide occupational training qualifications from the Weir Oil & Gas Centre of Manufacturing and Engineering Excellence in Southern Iraq.

Weir Oil & Gas is the first training provider in Iraq to receive approval to deliver OPITO-accredited SCQF Level 4 and 5 occupational training qualifications in Basic Maintenance Practices and Maintenance Practices for Instrument, Control, and Mechanical Operations. The local delivery of these training programs will help ensure the availability of an in-country, technically skilled, knowledgeable and safety-conscious workforce.

Over the past three years, Weir Oil & Gas has delivered more than 15,000 combined internal and external training hours, mostly to Iraqi personnel, encompassing classroom-based learning and on-the-job training.

With a constant presence in Iraq since 2014, Weir Oil & Gas has increased its local content through skills development and the structured training of local nationals, focusing on oil and gas services professionals.

The collaboration with OPITO aligns with Weir Oil & Gas' vision to become a leading provider of oil and gas industry training and skills development in the Middle East, through enhancing the delivery of training to local nationals, and supporting skills development projects in Iraq and Oman for a portfolio of companies that includes major global oil companies.

Ronan Le Gloahec, President of Weir Oil & Gas Eastern Hemisphere, said, "Our partnership with OPITO will allow us to provide unparalleled local content and training for oil and gas personnel in Iraq, creating a solid and necessary foundation for companies operating in the region to flourish."

Richard Roberts, Regional Vice-President, MEA of OPITO, said, "Iraq's success as an oil and gas producer will, in part, be reliant on its ability to build a strong local talent pool through ensuring the availability of vocational technical skills in-country that are commensurate with international benchmarks. Our collaboration with Weir Oil & Gas is an important step forward in ensuring the delivery of accredited training programs in Iraq and the Middle East and will help safeguard the continued development of a competent energy sector workforce."

(Source: Weir)

By John Lee.

Scottish engineering company Weir Group has announced the sale of its Oil & Gas division to US-based Caterpillar Inc.

The all-cash sale gives its Texas-based division an enterprise value of US$405m (£314m), subject to customary working capital and debt-like adjustments at closing.

The move is part of Weir's strategy to become a "premium mining technology pure play". 

Weir's Iraqi operations are managed from North Rumaila, where it provides mechanical and rotating equipment repairs and upgrades, oilfield and drilling equipment repair and certification, asset management and field services.

(Source: Weir)

Weir Oil & Gas Dubai announced today it has signed a multi-year multimillion dollar contract in Iraq with a major gas company.

The contract secures the provision of Weir Oil & Gas fabrication, workshop-machining services and field services to support the company's operations in Iraq, especially with respect to brownfield modifications and rotating equipment maintenance.

According to a statement from the company, this is a strategic agreement that will enable Weir to be a key player for the international gas company and allow Weir to expand their portfolio in the specific oil field in which the gas company operates.

Ronan Le Gloahec, Eastern Hemisphere President for Weir Oil & Gas, said:

"We are pleased to support our clients through providing services, repairs and important upgrades while assisting them with engineer-driven change management protocols and production facility turnarounds.

"With this contract we will support this client's gas operations for several years to come thanks to our state-of-the-art facility and in-country engineering know-how."

(Source: Weir)

By John Lee.

UK-based Weir Group has reportedly signed a $5-million contract to provide "rotating equipment overhaul services" in Iraq.

The client was not named, but was described as "a major Iraq JV".

(Source: Arabian Industry)

NATO Leads New Mission to Develop Iraq’s Defense Institutions

A new NATO-led mission in Iraq will work to further develop Iraq’s security institutions and structures, British Army Maj. Gen. Christopher Ghika told Pentagon reporters here today.

The mission is expected to be established by early next year, said Ghika, who declined to specify which NATO nations and the number of personnel would be involved.

Ghika, deputy commander of strategy and information for Combined Joint Task Force Operation Inherent Resolve, spoke during a video teleconference from Baghdad today.

The nature of the mission will be noncombat, he said. It will consist of advisors working closely with officials of the Iraqi Ministry of Defense and the Office of the National Security Advisor “to help Iraq build a more effective, sustainable, inclusive and transparent defense sector.”

The focus of those efforts will be on institutional education in the National Defense University, the Joint Forces Staff College, and some of the schools which are building military capability in areas such as engineering and infantry, he said. The advisors will focus on training the Iraqi instructors.

Ghika also provided an update on coalition efforts to counter the Islamic State of Iraq and Syria and provide aid to civilians impacted by the fighting.

Coalition Efforts in Syria

Last week provided for the safe delivery of critical humanitarian aid to the Rukban internally displaced person’s camp near At-Tanf Garrison, Syria, on the border with Jordan in the deconfliction zone, Ghika said.

Leading that effort were the Maghaweir al Thowra, a fighting force native to southern Syria and a partner of CJTF – OIR, the United Nations and the Syrian Arab Red Crescent, a humanitarian nonprofit organization. Maghaweir al Thowra was previously called the New Syrian Army.

Supplies delivered included 10,475 food parcels, clothes for 18,000 children, 10,000 hygiene kits, as well as newborn baby kits for about 1,200 children, he said.

Also, the U.N. conducted an emergency vaccination campaign to protect around 10,000 children against measles, polio and other potentially deadly diseases.

Currently, the coalition and Syrian Democratic Forces partners are fighting ISIS in the last physically held terrain in the Middle Euphrates River valley around the town of Hajin in eastern Syria, Ghika said.

“This is a hard fight. Indeed, we have witnessed some of the most intense fighting since ISIS was defeated in Raqqa, [Syria,] and Mosul, [Iraq]. The ultimate outcome is not in doubt. ISIS will be defeated in the Middle Euphrates River valley,” he said.

On Nov. 8, U.S. and Turkish forces conducted their second combined joint patrol in the vicinity of the town of Manbij, Syria, on the west bank of the Euphrates, about 19 miles from Turkey. “This is a critical part of the coalition’s efforts to prevent the resurgence of ISIS there and enable the voluntary return of refugees and internally displaced people,” Ghika said.

Coalition Efforts in Iraq

Iraqi security forces continue to target ISIS fighters who are attempting to regroup and regain a foothold in the small pockets of the Anbar Desert area of Iraq. Those efforts, called Operation Last Warning, are broadening to the entire country, he said.

Additionally, Iraqi forces are shoring up the border with Syria to prevent ISIS fighters from fleeing to Syria, reinforcing efforts of the SDF, he said.

In Saladin province in northern Iraq, the ISF and the Iraqi counterterrorism service, supported by the coalition, conducted multiple strikes on an ISIS senior leader meeting, killing a significant number of ISIS militants and key leaders, Ghika said.

Progress in Battling ISIS

“I’m struck by the immense progress that’s been made by Iraqi security forces and Syrian democratic forces partnering against the evil of ISIS,” said Ghika, noting that this is his second CJTF – OIR tour, the first as deputy commander of the coalition’s land component command in 2014 to 2015.

A recently published U.N. report on atrocities and mass graves in territories formerly controlled by ISIS documents 202 mass grave sites and the U.N. estimates these sites contain 6,000 to 12,000 bodies, he said.

“This is a stark reminder of why the coalition to counter ISIS was established and why nations across the globe have been willing to send their fighting men and women here,” Ghika said.

(Source: US Dept of Defense)

By John Lee.

Weir Oil & Gas Dubai has announced the signing of multi-year contracts in Iraq with two international oil companies totaling more than $50 million USD.

According to a press release from the company, the contracts secure the provision of Weir Oil & Gas workshop services and engineering support for an oil field and valve repair and maintenance services for another giant oil field, respectively.

Ronan Le Gloahec (pictured), EMEARC Managing Director for Weir Oil & Gas, said:

“We are pleased to support our clients through providing services, repairs and important upgrades while assisting them with engineer-driven change management protocols and production facility turnarounds.”

(Source: Weir)

By John Lee.

Iraq's Heavy Engineering Equipment State Company (HEESCO) has signed deals with three international companies in the oil, petrochemical and the marine industries:

• UK-based Weir Engineering Services;
• Czech-based KPS;
• Egyptian-based Petrojet.

The company, established in 1963, has technological capabilities in the design, manufacturing and installation of the engineering equipment, such as the tanks, boilers, heat exchangers, pressure tanks, refining towers, bridge pillars, river boats and engineering inspection.

Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] (pictured) said that the Ministry aims to increase cooperation with international companies.

(Source: Ministry of Oil)

Weir Oil & Gas Dubai has reportedly been awarded a contract with Eni Iraq BV to provide global maintenance services for gas compressor units and associated equipment located in the three Initial Production Facilities (IPF) plants in the Zubair oil fields in Southern Iraq.

The gas compressor units are comprised of gas engines, gas compressors, and relevant associated equipment. There are 30 compressors in total, with 18 at Hammar, six at Zubair and six at Rafidya. Weir engineers are now responsible for maintenance servicing of all compressors at each of the sites.

Ronan Le Gloahec (pictured), EMEA Regional Managing Director of Weir Oil & Gas, said:

“Weir was selected for this contract due to our experience in Iraq, local footprint and know-how of the specific rotating machines and Field Maintenance methodologies.

“In addition to our state-of-the-art manufacturing facilities in Dubai and service centre in Abu Dhabi, we have a dedicated service centre in Basra, the first facility in Iraq has both API and ISO licenses.”

(Source: Oilfield Technology)