PETROCELTIC, the oil and gas firm that acquired Edinburgh-based Melrose Resources in 2012, has recorded a big increase in losses after suffering drilling setbacks in places such as the Kurdistan region of Iraq, but said it is making good progress.
The Dublin-based firm made a pre-tax loss of $48.5 million (£30m) in the six months to June, compared with $5m in the preceding year.
The increase in losses came after Petroceltic wrote off $64m in respect of unsuccessful wells in Kurdistan, Romania and Egypt. It wrote off $21.8m exploration costs in the first half of 2013.
Some $50.7m of the latest write offs relate to the Shakrok licence in Kurdistan, where a recent well found only uncommercial amounts of gas rather than more valuable oil.
Last month the company suspended operations in Kurdistan and evacuated non-essential personnel amid the turmoil in the country.
Yesterday, Petroceltic said it hopes to resume operations on the Dinata licence in early October if circumstances allow.
Petroceltic wrote off $8.1m in respect of a dry well off Romania and $3.3m for one on the West Dikirnis lease in Egypt.
Petroceltic increased its exposure to both countries through the £165m takeover of Melrose. It retained the company's operations in Edinburgh.
Chief executive Brian O'Cathain, said: "Petroceltic's production and development business has delivered a solid performance to date in 2014."
He said the recent farm out of a stake in the Ain Tsila field in Algeria and signing of a gas sales agreement were important milestones towards unlocking a world class asset.
Mr O'Cathain said first half production performed "significamtly" ahead of expectations at approximately 25,200 barrels oil equivalent per day. Full year guidance has been revised upwards to 21,000-23,000 boepd from 20,000 to 22,000.
In June Petroceltic agreed a peace deal with a Swiss hedge fund, Worldview Capital Management, which had opposed a $100m share placing it completed.
Melrose's former chief executive David Thomas lost his seat on Petrolectic's board but remained chief operating officer.
Robert Adair, founder of Melrose, is Petroceltic's chairman.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article