Dana Gas has received an additional $44.3 million (Dh162.7m) in payment from Egypt, of which $35m is from the government, with the remainder accrued from the sale of condensate.
This brings the total payment received from the Egyptian government by the Sharjah gas company to a total of $55m in December. Total receipts from the North African state now stands at $199m compared with $164m last year.
Patrick Allman-Ward, chief executive, Dana Gas said the $55m in payment would enable the company to push ahead with final preparations on drilling the first offshore deep-water exploration well in the Block 5 North El Arish concession area early next year.
"This is the first of several high potential prospects in the block. We are encouraged by the government’s willingness to make payments against their outstanding receivables before the year-end and we hope this will carry through into 2019 to clear the outstanding balance entirely as per the agreement,” he said.
The Sharjah company, one of the biggest private gas players in the region, has struggled with its receivables from Egypt in the past and had previously said it would balance new capital expenditure programme against payments.
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While the company’s total receivables from Egypt have marked a year-to-date increase of 21 per cent, the level of payments remains at its lowest since 2011. The statement added that Dana Gas hoped for "further improvement in payments so as to reduce the level to zero as agreed".
In its latest payment, $9.3m was received from the sale of 157,350 barrels of El Wastani condensate, its fifth shipment this year of the high-value liquid, which fetches a higher price than crude.
Earlier this month, Dana Gas said production capacity had increased by 12.5 per cent from the end of September thanks to higher output from the Kurdistan Region of Iraq as well as Egypt.
Production reached 70,000 barrels of oil equivalent per day (boepd) in November and has remained above that level, up from the nine-month average of 62,250 boepd. Production from the drilling of the Balsam-8 well in Egypt in the fourth quarter also contributed more than 5,000 boepd to the increase in production.