Dana Gas redeems remaining $309m of outstanding sukuk

Energy company has 'significantly reduced' its financing costs, chief executive says

Dana Gas, the Sharjah-based energy company, redeemed the remaining $309 million it owed on its sukuk.

The company disbursed payments on Monday and said sukuk holders should begin to receive funds by Tuesday. Its outstanding debt at a corporate level now consists of a $90m credit facility, it said.

“We are pleased to have settled all our obligations with our sukuk holders as scheduled and have now significantly reduced our ongoing financing costs," the company's chief executive Patrick Allman-Ward said. "We have a strong business model and substantial growth potential from our asset base which includes, once the previously announced sale of our Egyptian assets completes, two world-class fields in the KRI (the Kurdistan Region of Iraq) and a highly prospective offshore block in Egypt.”

Dana Gas restructured a $700m sukuk in 2017 following a dispute with some of its creditors after the company had initially declared the instrument non-compliant. It eventually agreed a deal with creditors to repay 20 cents on the dollar and to restructure the remainder into a $530m instrument to be repaid over three years. It repurchased $221m of the sukuk over the past three years and has now repaid the remainder following the $236m sale of onshore oil and gas assets in Egypt announced last week.

The company reported a net loss to shareholders of $19m in the first six months of 2020, compared to a profit of $140m in the same period last year. Gross revenue fell 25 per cent to $181m on the back of lower selling prices and lower production levels in Egypt.