Oil company Genel Energy said on Thursday that cash holdings were expected to top $500.0m before the end of the year thanks to another strong quarter on the production front and elevated crude prices.
Genel Energy reported net production of 30,350 barrels of oil per day for the first nine months of 2022, and 30,200 in the third quarter, in line with guidance. Production from the Tawke field in Kurdistan, Genel’s major asset, averaged 108,300 barrels per day in the third quarter.
Margins came to $36 per barrel in the first three quarters, up from $24 at the same time a year ago, with Brent crude averaging $105 per barrel – a marked increase from the $71 a barrel at the same time twelve months earlier.
Capital expenditure was $109.0m, of which $55.0m was spent at Tawke, and $38.0m at its Sarta asset.
For 2022 as a whole, net production guidance was reiterated at 30,000-31,000 bopd, while capex guidance was also unchanged at between $150.0m-$170.0m.
Chief executive Paul Weir said: “I am pleased that we remain on track to generate around $250.0m of free cash flow this year, building towards a significant cash balance of over $500.0m by the end of the year. We are focused on putting this cash to work to purchase new assets, grow the business, and increase shareholder returns.
“It is business as usual on an operational level in Kurdistan, while we continue to work with the KRG on the challenges that the sector faces. Our existing predictable production business outlook supports our established dividend of $50.0m, and our committed dividend programme has paid $178.0m of cash to shareholders since its inception in 2019.”
As of 1025 GMT, Genel shares were up 5.66% at 134.83p.
Reporting by Iain Gilbert at Sharecast.com
