ITHACA
ENERGY PLC
("Ithaca
Energy", the "Company" or the "Group")
FY 2024
Trading Update
20
February 2025
Full year
performance at the top end of management guidance with strong Q4
production and cost performance closing out a transformational
year
Ithaca Energy, a leading UK
independent production and growth company, today provides the
following unaudited trading update for the year ended 31 December
2024, ahead of announcing its Full Year Results on 26 March
2025.
Highlights: A materially transformed business, post
combination with Eni UK ("Business Combination")
·
Q4 production of 116.0 kboe/d1 and opex
per boe of approximately $14/boe delivering estimated Q4 EBITDAX of
$642 million
·
Strong 2024 production of 80.2 kboe/d1
at the top end of market guidance range
·
Reached peak production rates of 138
kboe/d1 in Q4, with strong performance continuing into
January (>120kboe/d1 average for the 3 months
Nov-Jan)
·
Strict cost control with opex falling below the
market guidance range
·
Capital costs in mid-point of the market guidance
range demonstrating organic investment commitment
·
Exiting 2024 as the largest resource holder in
UKCS, with estimated 2P Reserves & 2C
Resources of 658 mmboe1
as at 31 December 2024 (2023: 544
mmboe)
·
Significant benefits from Business Combination
being immediately realised:
- Enhanced portfolio strength and diversification supporting
materially improved production performance and
reliability
- Increased financial firepower and flexibility following
successful $2.25bn refinancing
- Integration well-advanced with IT systems and office
relocations completed in January 2025
- Reorganisation and streamlining process to be fully complete
by 1 July 2025
·
Rosebank project continues to progress in line
with multi-year development timeline following Judicial Review
ruling
·
Improved safety record with zero Tier 1 or 2
incidents in the year
·
Paid $200 million special dividend in December
2024 ($300 million in total for 2024), supporting 2024 dividend
target of $500 million
Yaniv Friedman, Executive Chairman, commented: "2024 was a transformational year for Ithaca
Energy. We enter 2025 with a stronger, more diverse production and
reserves base, significant investment optionality, increased
financial strength and an enhanced strategic platform. We continue
to see material opportunity in our home basin, with an eye on
international expansion, providing a range of strategic options for
growth. Our focus will continue to be on high-grading investment
across our range of growth opportunities, executing in line with
our strategy as a value-led investor, to maximise long-term
sustainable shareholder value."
Luciano Vasques, Chief Executive Officer,
commented "Our 2024 performance exceeded
expectations and the combination of the business with the Eni's UK
assets is demonstrating its value. The integration is progressing
well, with both operational and systems aspects well on track. We
have also seen improved performance in safety and a marked
reduction in emission intensity. We are progressing on all fronts
of our organic growth projects, and welcome the recent Judicial
Review ruling on the Rosebank development, which supports its
continued progression. The Rosebank development is good for the UK,
it supports 2,000 UK jobs in its construction phase, increases UK
energy security and contributes significant tax receipts to the
Government."
Iain Lewis, Chief Financial Officer, commented:
"With production at the top end of guidance and operational costs
driven lower than guidance, our financial performance in 2024 was
strong, with momentum building during the year, climaxing in a Q4
EBITDAX of over $0.6 billion. We continue to build our value
levered hedge position, which combined with our recently refinanced
balance sheet gives us a strong financial foundation for future
growth and cash returns."
Safe and responsible operator
·
Positive trend in safety performance in 2024, with
zero Tier 1 and Tier 2 process safety events recorded in the year
and significant reduction in total recordable incident
frequency
·
Business Combination emissions accretive with
reduction in CO2e GHG emissions intensity in 2024 to
23.9 kgCO2e/boe (on a Scope 1 and 2 net equity basis)
(2023: 25 kgCO2e/boe)
Strong Q4 production performance, with positive production
trend continuing into 2025
·
Pro-forma 2024 production of 105.5
kboe/d1 placing Ithaca Energy as the second largest
independent operator by production in the UKCS (2023: 70.2
kboe/d1)
·
Strong operational performance in Q4, achieving
average production of 116.0 kboe/d1
·
Reached peak production rates of 138
kboe/d1 in final quarter
·
Continued strong production trend into 2025, with
average production from November to January of >120
kboe/d1
Strong financial performance against guidance for enlarged
group, with materially enhanced Q4 results
|
●
|
2024 full year production of 80.2
kboe/d1, delivering production at the upper end of
guidance of 76-81 kboe/d for the enlarged group
|
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₋
|
Includes six months production from
Eni UK assets from 1 July economic effective date (legal completion
on 3rd October 2024)
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₋
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Production split approximately 60%
liquids and 40% gas
|
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●
|
Estimated 2024 net operating costs
of $649 million, representing a net unit opex cost of $22/boe,
below management guidance of $650 million to $730 million for the
enlarged Group
|
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₋
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Includes six months operating costs
from Eni UK assets from 1 July economic effective date
|
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Q4 cost per barrel of approximately
$14.0/boe demonstrating the high netback capability of the post
deal portfolio
|
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Estimated 2024 net producing asset
capital cost of $448 million, at mid-point of management guidance
of $410 - $480 million for the enlarged Group
|
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₋
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Includes six months capital costs
from Eni UK assets from 1 July effective date
|
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Estimated 2024 net Rosebank capital
spend of $198 million, marginally above management guidance of $170
million to $195 million, reflecting material project activity and
progress in 2024
|
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Rosebank project remains on track to
targeted first production date of 2026/27
|
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Group cash tax paid in the year of
$351 million below the Group's management guidance range of $390
million to $410 million due primarily to cash tax payments made
prior to economic effective date of the Business Combination that
will be offset in the final deal working capital
settlement
|
|
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₋
|
Pro-forma comparison of $405
million
|
|
|
₋
|
The significant majority of tax
payments relate to Energy Profits Levy, including all of the Ithaca
Energy legacy business cash tax payments
|
Enhanced cash generation and increased financial strength
supports material shareholder distributions
|
●
|
Estimated 2024 adjusted EBITDAX of
$1.4 billion (2023: $1.7 billion) and cash from operations of $0.9
billion (2023: $1.3 billion), representing contributions from Eni
UK assets from the completion date of 3 October onwards
|
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Estimated Q4 EBITDAX performance of
$642 million, reflects truly transformational nature of Business
Combination
|
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Successful $2.25 billion refinancing
completed in Q4, enhancing balance sheet strength and flexibility
with available liquidity of over $1 billion
|
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Hedged position at 31 January 2024
of 28.5 mmboe (c.66% gas, c.33% oil) from 2025 into 2027 with
average oil swap pricing >$77/bbl and average gas swap pricing
c.100p/therm
|
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Significant gas hedging activity
throughout Q1 securing attractive gas hedge positions during a
period of escalating prices
|
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Material ring fence corporate tax
and supplementary charge tax loss position of c.$5.4 billion at
year-end 2024
|
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$300 million of 2024 dividends paid
to date
|
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The Group remains committed to
delivering attractive returns to its shareholders, reaffirming
total dividend target of $500 million for 2024 and 2025
|
Upcoming events
Ithaca Energy plans to host an
Investor Update on Wednesday 26 March 2025 alongside its Full Year
Results. The Group expects to publish guidance for 2025 with the
full year 2024 results together with a full Competent Persons
Report (CPR) prepared by an independent reserves
auditor.
Enquiries
About Ithaca Energy plc
Ithaca Energy is a leading UK
independent exploration and production company focused on the UK
North Sea with a strong track record of material value creation. In
recent years, the Company has been focused on growing its portfolio
of assets through both organic investment programmes and
acquisitions and has seen a period of significant M&A driven
growth centred upon three transformational acquisitions in recent
years, including the recent Business Combination with Eni UK.
Today, Ithaca Energy is one of the largest independent oil and gas
companies in the United Kingdom Continental Shelf (the "UKCS"),
ranking second largest independent by production with the largest
resource base.
With stakes in six of the ten
largest fields in the UKCS and two of UKCS's largest
pre-development fields, and with energy security currently being a
key focus of the UK Government, the Group believes it can utilise
its significant reserves and operational capabilities to play a key
role in delivering security of domestic energy supply from the
UKCS.
Ithaca Energy serves today's needs
for domestic energy through operating sustainably. The Group
achieves this by harnessing Ithaca Energy's deep operational
expertise and innovative minds to collectively challenge the norm,
continually seeking better ways to meet evolving
demands.
Ithaca Energy's commitment to
delivering attractive and sustainable returns is supported by a
well-defined emissions-reduction strategy with a target of
achieving net zero ahead of targets set out in the North Sea
Transition Deal.
Ithaca Energy plc was admitted to
trading on the London Stock Exchange (LON: ITH) on 14 November
2022.
Note
1.
Given the increase in gas volumes in Ithaca
Energy's portfolio following the Eni UK Business Combination, the
gas conversion factor metric to boe for reporting purposes has been
recalibrated to more accurately reflect energy equivalence on a
combined boe basis using an average calorific value of all gas
streams
ENDS-
