Dana Gas achieves Dhs392m net profit for Q2

Revenue from the sale of hydrocarbons reached Dhs303m, with gross profits reaching Dhs97m, an increase of 31% compared to the same period last year, mainly due to condensate sales from the Company's operations in the Kurdistan Region of Iraq.

For the six month period ending 30 June 2009, Dana Gas generated total revenues of Dhs550m, with a gross profit of Dhs165m, a net profit of Dhs360m and EBITDAX of Dhs1,027m, over three times the amount achieved in the same period last year.

Dana Gas's Egypt operations contributed significantly to the excellent results, as it ended the quarter with a production of 3.19m barrels of oil equivalent (MMboe) for the quarter. The coming on stream of the El Basant and Sondos fields pushed the Company's production rate from 30,000 boepd to 37,000 boepd, and the Company's new gas discovery and three successful appraisal wells also had an appreciable effect on its results. The Tulip-1 exploration discovery, located in the West Qantara Concession in the Nile Delta region, is expected to add approximately 27bn cubic feet (bcf) of gas reserves, while the three successful appraisals - Sondos-2, El Basant-3 and Salma Delta-2 - confirmed expected reserves extension.

Two more exploration gas discoveries were made shortly after the end of the second quarter, Sharabas-1 and Sama-1 in the West Manzala and West Qantara concessions, respectively. The estimated combined reserves associated with the two discoveries are 76 bcf - 28 bcf gas for Sharabas-1 and 48 bcf gas for Sama-1.

During the period Dana Gas and Crescent Petroleum also signed an agreement with OMV Upstream International GmbH and MOL Hungarian Oil and Gas Public Limited Company, whereby the latter two companies purchased an equity interest in Pearl Petroleum Company Limited. The high-profile transaction resulted in PPCL being owned 40% by Dana Gas, 40% by Crescent Petroleum, 10% by OMV and 10% by MOL, and underpinned the companies' thrust and access into the huge European gas market.

Speaking of the excellent results, Dana Gas Chief Executive Officer, Mr Ahmed Al-Arbeed, said:

"Our numbers speak for themselves to the success of our operations. The second quarter of 2009 was marked by significant events for Dana Gas, particularly in the Kurdistan Region of Iraq, where we entered into strategic partnership agreements with two leading Central European integrated oil and gas groups - OMV, Austria's largest listed industrial company, and MOL, Hungary's largest listed company."

"In Egypt, we continued with our exploration success and significantly increased our production rate, and I am very pleased to inform our shareholders that during the first half our production rate in Egypt increased beyond 37,000 barrels of oil equivalent per day (boepd), from 31,650 boepd at the end of 2008. The new Sama-1 discovery offers the Company an opportunity to achieve an additional production increase, which will push us up to 40,000 boepd," Al Arbeed added.