Medco?s Q1 profit up 100%
Thursday, May 1 2014 - 01:05 PM WIB
Net profit stood at US$3.6 million in the first quarter of the year, compared to $1.8 million profit booked in the corresponding period of last year.
Sales reached $202 million in the first quarter of the year, a 8 percent decrease from $220 million in the first quarter of 2013, mainly because of lower of crude oil price and lower oil production rate, the firm said in a statement.
The firm said similar to the previous year, it has been successful in managing its mature oil fields, arresting the rates of production decline from these aging fields to below 10 percent year-on-year, against the industry trend of 25-30 percent per year.
In the quarter, the company also successfully renegotiated its gas price contract and increased the gas price from $5.15/mmbtu in the first quarter of 2013 to $6.56/mmbtu in 2014. The company continues its initiative for cost efficiency and successfully reduced production costs by 12 percent, from $131.5 million in the first quarter of 2013 to $116.0 million in the first quarter of 2014.
In addition, the head office and G&A costs were further reduced from $29 million in the first quarter of 2013 to $25 million for the same quarter of 2014. With this continuous efficiency initiative, the first quarter of 2014 operating income was improved to $61 million (compared to $59 million in the same quarter of 2013). The first quarter of 2014 EBITDA was recorded at $81.2 million (compared to $82.6 million in the same quarter of 2013).
As of the first quarter of 2014, the company?s major projects have shown good progress. The Senoro gas development project has reached 71 percent completion whilst the Donggi Senoro LNG plant has reached 98 percent completion and is expected to receive first Senoro gas supply for commissioning by the third quarter of 2014. The gas development project in Block A is in the process of finalizing the gas supply contract with Pertamina (for onward supply to Pupuk Iskandar Muda) and PLN, including a gas price increase. The Enhanced Oil Recovery (EOR) Pilot Project in the Rimau Block is deemed successfully completed by achieving the target additional oil recovery. The Libya Area 47 project has commenced its detailed engineering design work (FEED) and will continue into the EPC contract award by early 2015.
?We achieved our main target in oil and gas exploration and production despite the decline in oil production due to the natural decline of aging oil wells. We also finished the year 2013 on solid operating and financial performances to take the Company forward to accomplish and deliver our Major Projects development,? President Director & CEO, Lukman Mahfoedz, stated
?I am very confident that MedcoEnergi will grow significantly, commencing with the commissioning of our first Major Project, Senoro Gas, and the subsequent completion of other Major Projects in 2016 and beyond,? he added.
Editing by Johannes Simbolon