Dana Gas swings to first-quarter profit

The Sharjah company has made a first-quarter profit of Dh33m as it continues to make progress with its oil and gas operations in Egypt and Iraqi Kurdistan.

Dana Gas has swung to a first-quarter profit as the company continues to make progress with its oil and gas operations in Egypt and Iraqi Kurdistan amid higher energy prices. The Sharjah company posted after-tax net income of Dh33 million (US$8.9m) for the three months that ended on March 31, balancing its Dh32m loss a year earlier. Revenue increased by two thirds to Dh411m from Dh247m. "I am pleased to be able to report that Dana Gas is delivering good financial results from its strong operational performance in both Egypt and Iraq," said Ahmed al Arbeed, the chief executive of the company.

In Egypt, where Dana has made a series of oil and gas discoveries in recent years, first-quarter output averaged 39,200 barrels of oil equivalent per day (boepd), up 32 per cent from a year earlier. For the full year, the company is aiming for a 20 per cent production increase. It expects output this quarter to average 40,500 boepd. In Kurdistan, Dana and its partners continue to develop a large gasfield that is supplying fuel for regional electricity generation. The group has recently completed of a gas processing plant that is expected to contribute substantially to the profitability of the venture, in which Dana holds a 40 per cent interest.

In the past few days, the plant has started processing gas to strip out valuable liquids. The production of liquid petroleum gas (LPG) would start in the third quarter of this year, Mr al Arbeed said. Jim Dewar, the chief financial officer of Dana, said the development consortium did not profit from the gas it provided to local power plants, but was allowed to sell LPG and condensate, a type of light oil extracted from some gasfields, at international market prices.

The Kurdish venture started separating condensate from its gas stream late last year. [e-mail]