ABERDEEN-based Eland Oil & Gas has cut annual losses by 70 per cent in what chief executive George Maxwell described as the most successful year in the firm’s history.
Nigeria-focused Eland lost $8.8m (£7m) after tax in the year to 31 December compared with $30.4m in the preceding period during which it faced big challenges in the country.
Eland had to suspend production from the Opuama field in the Niger Delta in February 2016 because the Forcados terminal used to handle output was shut down due to sabotage.
The Shell-operated terminal reopened in May last year. Eland resorted to shipping oil to market for the first few months of the year.
The reopening of the terminal paved the way for Eland to achieve a big increase in revenues and in the profitability of its production operations.
Turnover increased to $68.9m in 2017 as the increase in the oil price provided support, from $2.4m in the preceding year.
Eland generated $13.6m profit after tax in the second half, with operating costs averaging $10 per barrel.
Production from the OML 40 licence increased to 18,500 barrels oil daily at the end of the year, from an average of 1,500 during 2016.
“2017 has been the most successful year in Eland’s history. This is primarily due to the growth in oil production from OML 40,” said Mr Maxwell.
He noted an expert report underlined the potential of OML40, in which Eland has a 22% stake.
Netherland, Sewell & Associates estimated Eland’s share of reserves on the proved and probable basis at 26.3m barrels, against 22.47m barrels in a report produced in 2015.
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