TIDMAAK
RNS Number : 8001P
Arawak Energy Limited
31 March 2009
Arawak ENERGY LIMITEd
Whiteley Chambers, Don Street, St. Helier, Jersey JE4 9WG
LSE & TSX TRADING SYMBOL: AAK
31 March 2009
FOR IMMEDIATE RELEASE
ARAWAK ANNOUNCES 2008 RESULTS
Arawak Energy Limited ("Arawak" or the "Company"), an oil and gas exploration
and production company, announces its results for the year ended 31 December
2008.
HIGHLIGHTS:
(In US dollars unless otherwise stated)
Operational
* Annual average production rose 10% to 11,380 barrels of oil equivalent per day
("boepd") (2007 - 10,332 boepd) comprising mainly oil and insignificant gas
volumes
* 44 exploration and development wells drilled with an overall drilling success
rate of 86%
* Sales volumes of 3,837,498 barrels of oil equivalent ("boe"), up 3% (2007 -
3,714,282 boe)
Financial
* Record annual sales revenue of $278.6 million, up 37% (2007 - $202.7 million)
* Average realised selling price of $72.61 per barrel, up 33% (2007 - $54.56 per
barrel)
* Net loss $27.9 million (2007 - net profit $31.3 million) after one-off costs of
$11.7 million associated with re-domiciliation to Jersey and listing on the
London Stock Exchange ("LSE"), and impairment charges of $45.9 million
* Income tax, export duties, mineral extraction tax and royalties increased 67% to
$133.9 million (2007 - $80.4 million)
* Capital expenditure (excluding acquisitions) of $60.2 million, up 6% (2007 -
$56.8 million)
Corporate
* On 28 October 2008, Rosco S.A. ("Rosco"), a subsidiary of Vitol Holdings B.V.,
announced a pre-conditional cash offer of C$0.90 per share for the Company.
Following careful consideration, the Board of Directors recommended to
shareholders in January an increased offer of C$1.00 per share (the "Offer"). On
24 March 2009, Rosco declared its offer unconditional and announced that it held
95.7% of Arawak's issued common shares.
Commenting on the results, President and Chief Executive Officer, Alastair
McBain said: "We made good progress towards strategic and operational goals in
2008 with record production and a comprehensive programme of drilling and
seismic acquisition activity across our portfolio. However, operational
achievements were overshadowed by serious external events in commodity prices,
the fiscal environment and capital markets. The high level of acceptance by
shareholders of Rosco's Offer is a reflection of the challenging circumstances
we faced at the end of 2008 but the Offer itself reflects Rosco's confidence in
our team and our operations and its desire to grow the Company further."
REVIEW OF 2008
Arawak enjoyed an increase in production of 10% to 11,380 boepd in 2008 compared
with 10,332 boepd in 2007, despite restrictions in the first nine months of the
year related to regulatory approvals for development at the Akzhar and Besbolek
fields in Kazakhstan and the curtailment of production in Kazakhstan and Russia
in December 2008 following a significant deterioration in margins owing to high
taxation and a material decline in world oil prices.
Despite the production shut-in in December, output in Kazakhstan increased 16%
to 2.5 million barrels, equivalent to 6,840 barrels of oil per day ("bopd"),
while Russian production grew 4% to 1.6 million barrels, or 4,463 bopd. In
Azerbaijan, production fell 49% in 2008 to 28,366 boe, or the equivalent of 78
boepd.
Operational activities in 2008 comprised a balanced effort of exploration and
development drilling and geological and geophysical programmes. The Company
drilled 44 exploration and development wells and achieved an overall success
rate of 86%. Seven seismic surveys were completed in 2008 and interpretation of
the 1,343 sq km of 2D and 148 sq km of 3D data is underway. Capital expenditure
in 2008 totalled $60.2 million excluding acquisitions against $56.8 million a
year earlier.
The Karsak oil terminal was commissioned in May 2008, enabling the Company to
produce, treat and transport crude oil from the Besbolek, Karataikyz and Alimbai
fields to the trunkline system. Regulatory approvals were obtained to transition
from exploration to the development phase for the Akzhar and Besbolek oil fields
and the North Irael producing asset in Russia. Arawak's in-field teams rapidly
mobilised five rigs at Akzhar and Besbolek once the authorities had sanctioned
the development plans in September and in eight weeks they had re-entered and
re-opened shut-in wells at both fields and drilled ten wells at Akzhar and six
at Besbolek.
Arawak completed two acquisitions in Kazakhstan last year, the Tamdykol
exploration block in May and a 40% working interest in the Saigak oil field in
June. Saigak has added approximately 1,000 barrels of oil per day to Arawak's
production since acquisition.
Sales volumes grew 3% from 3,714,282 boe in 2007 to 3,837,498 boe in 2008 in
line with higher production, and the average realised selling price in 2008 rose
33% to $72.61 per barrel compared with $54.56 per barrel a year earlier.
Oil and gas sales revenues reached $278.6 million in 2008 compared with $202.7
million in 2007. The net loss in 2008 was $27.9 million after a write off of
$45.9 million related to the Kazakhstan and Azerbaijan cost pools, in particular
by poorer than expected results for the East Zharkamys III and South West
Gobustan assets respectively. The 2008 result also included costs of $11.7
million associated with the corporate re-domiciliation from Anguilla to Jersey
and with the listing on the LSE. In 2007, Arawak reported an annual net profit
of $31.3 million.
Payments to host governments by way of income tax, export duties, mineral
extraction tax and royalties jumped to $133.9 million from $80.4 million in 2007
as a consequence of higher duties on exports in Russia, the introduction of a
customs export duty in Kazakhstan in May and payment of excess profit tax at the
Akzhar, Besbolek and Alimbai producing fields.
The Company's 40% interest in the Saigak field contributed a loss of $0.9
million to the consolidated results in the seven months since acquisition. This
result was adversely affected by the settlement of income tax penalties and
associated liabilities of $2.5 million (Arawak's share only).
The Azerbaijani operations contributed a loss of $19.2 million to the
consolidated results in 2008 after the impairment charge of $18.1 million.
On 24 March 2009, Rosco announced it had received acceptances for its Offer
mailed to shareholders on 30 January in respect of a total of 99,155,506 Arawak
shares representing 54.28% of the issued common share capital of Arawak. Rosco
and its affiliates already held 41.43% of Arawak's total share capital. Rosco
has declared the Offer wholly unconditional and has commenced proceedings to
acquire compulsorily the remaining Arawak shares to which the Offer relates. It
also announced its intention to procure that Arawak makes applications for the
delisting of Arawak shares from the London and Toronto stock exchanges. Arawak
formally applied on 24 March to the UK Listing Authority for the cancellation of
listing of the Arawak shares on the Official List, and to the LSE for the
cancellation of admission to trading in Arawak shares on the market for listed
securities. Cancellation from the LSE is expected to be effective from 24 April
2009.
The following tables provide a summary of the financial and operating highlights
of 2008, compared to 2007 and 2006.
+---------------------------------------+----+-----------+-----------+-----------+
| FINANCIAL HIGHLIGHTS | | | | |
| In thousands of US dollars, except | | | | |
| per share amounts | | | | |
| | | | | |
+---------------------------------------+----+-----------+-----------+-----------+
| For the year ended 31 December | | 2008 | 2007 | 2006 |
+---------------------------------------+----+-----------+-----------+-----------+
| Crude oil sales | | 278,635 | 202,653 | 130,455 |
+---------------------------------------+----+-----------+-----------+-----------+
| Net (loss)/income | | (27,942) | 31,261 | 12,439 |
+---------------------------------------+----+-----------+-----------+-----------+
| Per share - basic | | (0.16) | 0.18 | 0.07 |
+---------------------------------------+----+-----------+-----------+-----------+
| Per share - diluted | | (0.16) | 0.18 | 0.07 |
+---------------------------------------+----+-----------+-----------+-----------+
| Funds from operations* | | 49,734 | 64,486 | 40,259 |
+---------------------------------------+----+-----------+-----------+-----------+
| Per share - basic | | 0.28 | 0.37 | 0.23 |
+---------------------------------------+----+-----------+-----------+-----------+
| Per share - diluted | | 0.28 | 0.37 | 0.23 |
+---------------------------------------+----+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+----+-----------+-----------+-----------+
| Capital expenditure (excluding | | 60,216 | 56,776 | 51,660 |
| acquisitions) | | | | |
+---------------------------------------+----+-----------+-----------+-----------+
| Capital expenditure (licence | | 4,122 | - | 25,033 |
| acquisitions) | | | | |
+---------------------------------------+----+-----------+-----------+-----------+
| | | | | |
+---------------------------------------+----+-----------+-----------+-----------+
| As at 31 December | | 2008 | 2007 | 2006 |
+---------------------------------------+----+-----------+-----------+-----------+
| Shareholders' equity | | 151,732 | 164,521 | 128,052 |
+---------------------------------------+----+-----------+-----------+-----------+
| Shares outstanding - basic | | 182,644 | 173,892 | 173,392 |
+---------------------------------------+----+-----------+-----------+-----------+
| Shares outstanding - diluted | | 182,644 | 174,702 | 174,226 |
+---------------------------------------+----+-----------+-----------+-----------+
| Weighted average shares - basic | | 178,756 | 173,549 | 173,240 |
+---------------------------------------+----+-----------+-----------+-----------+
| Weighted average shares - diluted | | 178,756 | 174,689 | 174,074 |
+---------------------------------------+----+-----------+-----------+-----------+
*
* Funds from operations is a non-GAAP measure that represents cash generated
from operating activities before changes in non-cash working capital.
The net loss for 2008 is stated after the following one-off costs:
+---------------------------------------+----+------------+-----------+-----------+
| In thousands of US dollars | | | | |
+---------------------------------------+----+------------+-----------+-----------+
| For the year ended 31 December | | 2008 | 2007 | 2006 |
+---------------------------------------+----+------------+-----------+-----------+
| Net (loss)/income | | (27,942) | | |
| | | | 31,261 | 12,439 |
+---------------------------------------+----+------------+-----------+-----------+
| Impairment of oil and gas properties | | 45,905 | - | - |
+---------------------------------------+----+------------+-----------+-----------+
| Re-domiciliation and listing expenses | | 11,741 | - | - |
| | | | | |
+---------------------------------------+----+------------+-----------+-----------+
| Net income before one-off costs | | 29,704 | | |
| | | | 31,261 | 12,439 |
+---------------------------------------+----+------------+-----------+-----------+
+--------------------------------+-----------+-----------+-----------+-----------+
| OPERATIONAL HIGHLIGHTS | | | | |
| In US dollars | | | | |
+--------------------------------+-----------+-----------+-----------+-----------+
| For the year ended 31 December | | | 2008 | 2007 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Production - boe | | | 4,165,193 | 3,771,346 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Average daily production - boe | | | 11,380 | 10,332 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Sales - boe | | | 3,837,498 | 3,714,282 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Average daily sales - boe | | | 10,485 | 10,176 |
+--------------------------------+-----------+-----------+-----------+-----------+
| | | | | |
+--------------------------------+-----------+-----------+-----------+-----------+
| Revenue and expenses per boe | | | | |
| sold | | | | |
+--------------------------------+-----------+-----------+-----------+-----------+
| Crude oil and gas sales | | | 72.61 | 54.56 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Interest and other income | | | 0.35 | 0.94 |
+--------------------------------+-----------+-----------+-----------+-----------+
| Royalties and taxes | | | (22.54) | (11.61) |
+--------------------------------+-----------+-----------+-----------+-----------+
| Production costs | | | (6.18) | (5.07) |
+--------------------------------+-----------+-----------+-----------+-----------+
| Transportation and selling | | | (5.99) | (5.47) |
| expenses | | | | |
+--------------------------------+-----------+-----------+-----------+-----------+
| Net operating income | | | 38.25 | 33.35 |
+--------------------------------+-----------+-----------+-----------+-----------+
Arawak also announces that it has filed its 2008 Annual Information Form
("AIF"), including its Statement of Reserves Data and Other Oil & Gas
Information for the year ended 31 December 2008 pursuant to National Instrument
51-101 Standards of Disclosure for Oil & Gas Activities of the Canadian
Securities Administrators. Arawak's audited consolidated financial statements,
related Management's Discussion and Analysis and Annual Report for the year
ended 31 December 2008 have also been filed. Copies of these documents may be
accessed electronically on the website for the System for Electronic Document
Analysis and Retrieval ("SEDAR") at www.sedar.com and Arawak's website at
www.arawakenergy.com.
For further information please contact:
Arawak Energy Limited Tel: +44 (0) 20 7973 4285
Tanya Pang, Head of Investor Relations Fax: +44 (0) 20 7824 8466
E-mail:info@arawakenergy.com Web: www.arawakenergy.com
Brunswick Group LLP Tel: +44 (0)20 7404 5959
Patrick Handley
JPMorgan Cazenove Limited Tel: +44 (0)20 7588 2828
Steve Baldwin
Neil Haycock
Oriel Securities Limited Tel: +44 (0)20 7710 7600
Richard Crawley
Natalie Fortescue
Notes to editors:
Arawak's Common Shares are listed for trading on both the Toronto Stock Exchange
("TSX") and the London Stock Exchange ("LSE") under the symbol "AAK". On 16
January 2009, Arawak together with Rosco S.A. ("Rosco"), announced that the
Boards of both companies had reached agreement on the terms of a recommended and
increased pre-conditional cash offer to be made by Rosco (or a wholly owned
subsidiary of Rosco) to acquire the entire issued and to be issued share capital
of Arawak (the "Offer"). The Offer was made at a price of C$1.00 for each Arawak
share. As of 24 March 2009, Rosco held a total of 95.7% of Arawak's issued
common share capital. It has declared the Offer wholly unconditional and has
commenced proceedings to compulsorily acquire all remaining outstanding shares.
All documentation related to the Offer can be found on www.arawakenergy.com or
on www.sedar.com.
Arawak is engaged in the exploration, development and production of oil and
natural gas in Kazakhstan, Russia and Azerbaijan. In Kazakhstan, the Company
holds five producing fields and two exploration blocks. The Company has a 40%
participating interest in the Saigak producing block acquired in June 2008. The
remaining assets are held through its 100% wholly-owned subsidiary Altius Energy
Corporation ("Altius"). Altius' main producing field is Akzhar with smaller
fields at Besbolek, Karataikyz and Alimbai. The two exploration blocks East
Zharkamys III and Tamdykol are also situated in western Kazakhstan. Arawak's
producing assets in Russia are held through ZAO PechoraNefteGas ("PNG") and LLC
NK Recher-Komi ("Recher-Komi"), in which Arawak has a 50% interest with the
remaining interest being held by Lundin Petroleum AB. Also in Russia, Arawak
holds a 100% interest in the Kymbozhyuskaya exploration block and in the South
Sotchemyu appraisal block. In Azerbaijan, the Company's asset is its interest in
the Exploration Development and Production Sharing Agreement ("EDPSA") for the
South West Gobustan oil and gas fields. CGL, a company registered in Anguilla,
British West Indies, in which the Company has a 37.17% interest, holds an 80%
interest in the EDPSA with the remaining 20% held by an affiliate of SOCAR. The
remaining 62.83% share in CGL is held by two affiliates of the project operator,
CNPC.
This announcement includes "forward-looking statements", including statements
with respect to Arawak's anticipated exploration and development activities
which are based on the opinions and estimates of management at the date the
statements are made, and are subject to a variety of risks and uncertainties and
other factors that could cause actual events or results to differ materially
from those projected in the forward-looking statements. These risks and
uncertainties include, but are not limited to, risks associated with the oil and
gas industry (including operational risks in development, exploration and
production; delays or changes in plans with respect to exploration or
development projects or capital expenditures; the uncertainty of reserve
estimates; the uncertainty of estimates and projections in relation to
production, costs and expenses and health, safety and environmental risks), the
risk of commodity price and foreign exchange rate fluctuations, the uncertainty
associated with commercial negotiations and negotiating with foreign governments
and risks associated with international activity. Statements relating to
"reserves" are deemed to be forward looking statements as they involve the
implied assessment, based on certain estimates and assumptions, that the
reserves described exist in the quantities predicted or estimated and can be
profitably produced in the future. Although Arawak believes that its
expectations represented by these forward-looking statements are reasonable,
there can be no assurance that such expectations will prove to be correct. Due
to the risks, uncertainties and assumptions inherent in forward-looking
statements, prospective investors in the Company's securities should not place
undue reliance on these forward-looking statements. For a detailed description
of the risks and uncertainties facing Arawak, readers should refer to Arawak's
Annual Information Form for the year ended 31 December 2008 and dated 30 March
2009 as filed at www.sedar.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR GCGDXRUXGGCB
Grafico Azioni Arawak (LSE:AAK)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Arawak (LSE:AAK)
Storico
Da Giu 2023 a Giu 2024
