Dana Gas, the Middle East's largest regional private sector natural gas company, has announced solid results for the period from January to September, registering a 246 per cent growth in its net profit which soared to Dh521 million ($142 million) from Dh149 million ($41 million) last year.

Announcing its financial results for the nine-month period ended September 30, 2019, Dana Gas said this increase in the net profit was mainly due to higher other income amounting to $126 million resulting from recognition of financial assets related to certain reserve-based earn-out and other entitlements."

It was partially offset by a $60 million impairment provision in relation to the Merak-1 well in Egypt which was drilled in Q3 but did not encounter commercial hydrocarbons, stated the Emirati gas company.

Excluding the increase in other income and the impairment provision, net profit from core operations increased by 85% to $76 million over $41 million last year, it stated.

This was principally due to an increase in production in Kurdistan Region of Iraq (KRI) post successful completion of the debottlenecking in Q3 2018 and lower debt servicing cost, it added.

On the solid results, CEO Dr Patrick Allman-Ward said: "Our strong financial and operational performance over the first nine months of 2019 is a testament to the company’s growing strength as production increases and collections improve."

Dana Gas' average production for the nine-month period rose 8% to 67,100 bpd from 62,250 bpd last year. KRI output rose significantly, increasing 23% to 31,800 bpd compared to 25,800 bpd last year.

"We are also moving ahead with the development and construction of the first of our two gas processing trains in the KRI, which will allow us to produce and sell an additional 250 MMscf/d of gas by 2022," he stated.

On its Q3 performance, Dana Gas said its net profit for the period stood at $2 million. However, after adjusting for one-off items, net profit matched the level of the prior year at $17 million. Revenues too reached $115 million, the same as in Q3 2018.

The  Middle East's leading gas company's revenues rose 2% to $357 million for the nine months  compared to $351 million last year as increased production in the KRI offset lower realised prices and lower production in Egypt and the company’s Zora Gas Field in the UAE.

Higher production contributed $32 million while reduced realised prices impacted the company’s topline by $26 million, it stated.

As of September 30, 2019, Dana Gas' cash position stood at $392 million, little changed from the $407 million at the end of 2018, and includes a dividend payment of $105 million made in May and ongoing sukuk profit payments, it added.-TradeArabia News Service