The third quarter result is characterized by solid operational performance on Draugen, strong net cash flow contribution, lower volumes sold, cost related to exploration activities and exchange rate loss. Total net production in the quarter was 18 125 boepd while operating profit was NOK 227 million, down from NOK 367 million in Q2 2019.
Total operating income in the quarter was NOK 622 million, a decrease from NOK 1 039 million in Q2 2019 mainly caused by one lifting on Draugen compared to two in the previous quarter, lower production volumes on Gjøa and lower liquids and gas prices. Correspondingly, net sold volumes in Q3 2019 were 16,696, down by 33% since the previous quarter.
OKEA produced 18 125 boepd in Q3 2019, down from 20 045 boepd in Q2 2019. The production decrease is mainly explained by modifications and export constraints on Gjøa. Production from Draugen increased by 4% in the quarter. The average realized liquid price was USD 56.4 per barrel, while gas revenues were recognized at market value of USD 0.11 per standard cubic meter.
“Our operated asset Draugen has no serious safety incidents and a production regularity as high as 97% this quarter. This demonstrates that OKEA is an operator dedicated to safe and efficient operations. OKEA has in 2019 revitalised the operations at Draugen, with focus on safety, decision lead time, simplifications and use of new technology, digitalisation and collaboration with partners. Although the financial result is impacted by lower volumes, prices and exchange rates, I am very pleased to see that we generate a strong cash flow from our operations”, says Erik Haugane, CEO of OKEA.
“OKEA’s ambition is to lift near-term production. We initiated as planned the drilling of two wells as operator in October. Late October, OKEA reported that volumes discovered in the Infill-Ø well, do not require a new producer to this area. The results from ongoing drilling of Skumnisse are expected mid-November. We are progressing as planned on the Gjøa P1 project and the Yme New Development project is on schedule for first oil in Q2 2020”, Mr. Haugane continues.
OKEA is also pleased to announce that, on 31 October 2019, Birte Norheim accepted the position as CFO in OKEA. Start date in OKEA to be announced later.
The results will be presented by Erik Haugane, CEO and Kjersti Hovdal, SVP Accounting and Controlling today at 08:15 CET at Felix Conference Center at Bryggetorget 3 in Oslo. The presentation and Q&A session may also be followed through a live webcast from www.okea.no.
For further information:
CEO Erik Haugane, +47 907 21 655
VP Investor Relations Ståle Myhre, +47 917 51 878
About OKEA
OKEA is an Exploration and Production (E&P) company and operator on the Norwegian Continental Shelf with production of ~20 000 boe per day. OKEA aims to grow through low-cost field developments of discoveries with reserves up to 100 million boe and mergers and acquisitions (M&A). The operating organisation is built on the acquisition of the producing field Draugen in 2018.
OKEA is listed on Oslo Stock Exchange under the ticker “OKEA”.
More information on www.okea.no