Dana Gas Swung to profit in the third quarter as production in Egypt and Kurdistan drove revenues.
Egyptian and Kurdistan units drive Dana rebound
Dana Gas has swung to a profit in the third quarter as production in Egypt and Kurdistan drove revenues.
The Middle East's largest private natural gas company reported a net profit of Dh33 million (US$8.9m) in the third quarter against a loss of Dh79m for the same period last year, when write-offs from unsuccessful gas wells hurt earnings.
Dana Gas's Egypt operations continued to deliver strong results, producing 3.9 million barrels of oil equivalent (boe) in the third quarter, up 15 per cent on the same period last year.
Two gas discoveries on the Nile Delta with estimated reserves of between 60 billion and 110 billion cubic feet were also announced.
Dana's total oil and gas output jumped by 24 per cent in the third quarter compared with the same time last year.
In Iraqi Kurdistan, Dana Gas produced 1.2 million boe of gas and condensate during the quarter, an increase of about 72 per cent on last year. But delays in projects elsewhere weighed on results. The projected start-up of gas production from the offshore Sharjah gas field has been delayed to early 2012 from late next year, the company said.
"Drilling a well and getting the right rig to drill will take some time but we have progressed very well on the project … and we are now ready to move quickly," said Ahmed al Arbeed, the chief executive of Dana.
The future of the UAE gas project that will import gas from Iran is also in doubt.
The project involves the supply of gas by National Iranian Oil to Crescent Petroleum, in which Dana Gas has a 35 per cent stake. After a four-year delay, National Iranian Oil can now provide gas but is yet to begin operations.
"Unfortunately for this quarter we don't have an update, but it's important to both parties and we're both working hard on it," Mr al Arbeed said.
He added that Gas Cities, a 50 per cent joint venture with Crescent to establish gas and land allocations for potential developments in Yemen, Egypt and Kurdistan, will continue to be an area of focus next quarter.