Dragon Oil profits up 49%

Exploration and production company Dragon Oil has announced full-year pre-tax profits of $514.7 million, up 49 per cent compared to $344.9 million in 2009.

Revenues increased by a record 25 per cent to $780.4 million from $623.5 million while operating profit reached $487.7 million compared to $314.4 million a year earlier.

Earnings per share rose to 74.7 cents from 50.2 cents.

The board has recommended the payment of a full-year maiden dividend of 14 US cents per share for 2010.

Average gross daily rate of production rose 5.5 per cent to 47,211 barrels of oil per day (bopd) while the production exit rate for 2010 reached 57,013 bopd as against 49,698 bopd a year earlier.

"Dragon Oil enjoyed a record year in terms of revenues generated and the number of wells drilled and completed as well as awarding a number of major contracts for infrastructure projects," said chief executive Dr Abdul Jaleel Al Khalifa.

"We completed a major upgrade to the infrastructure base, thus eliminating the bottlenecks, which constrained production growth last year. This allowed us to achieve a robust exit rate of over 57,000 bopd, which we have successfully maintained throughout January 2011."

The company said it plans to complete up to 11 wells this year and up to 40 development wells in total, including five appraisal wells, between 2011 and 2013.

It also announced a target annual production growth of between 10 and 15 per cent both for this year and on average per annum for 2011 to 2013.

"We have a strong platform to deliver on the upper end of our production forecast this year and with more capital expenditure to come over the next two to three years to support our drilling campaign, we are paving the way for strong production growth in the future," he added.