Enquest revenues up, profits down as production rises

26th Mar 2014 07:31

- Revenue rises on increased output- Profit falls on higher cost of sales- Average price of oil declines- Production expected to grow in 2014Oil and gas company Enquest achieved an 8.1 per cent increase in annual revenue to 961.2m dollars as an increase in production offset a fall in price of oil sold. The UK-focused firm said production was up 6.2% to 24,222 barrels of oil equivalent per day (boepd) in the year ended December 31st, following a successful drilling programme.The realised average price per barrel of oil sold decreased 1.7% to $109.7.Profit from operations before tax and net finance costs dropped 7.5% to $374.8m, reflecting a $84.1m rise in the cost of sales, in part due to an increase in transportation costs. Earnings before interest, tax, depreciation and amortisation (EBITDA) fell 2.1% to $621.3m. Cash generated from operations was down 5.3% to $562.7m. In the full-year 2014 the company expects average production will increase to between 25,000 boepd and 30,000 boepd on plans to deliver 15 wells. The drilling programme this year includes a new production well on Don Southwest, a workover of a production well on the Greater Kittiwake Area, an ongoing intervention programme on Thistle, three production wells and one injection well on Alma/Galia and the recommencement of drilling on Heather for the first time since 2006."Our business model is sustainable and is set to deliver a material increase in cash flow from operations over the coming years," said Chief Executive Amjad Bseisu. RD