Norway's DNO says it is ramping up activity in the Kurdistan region of Iraq by fast tracking development of the Peshkabir field and is planning for its first dividend distribution to shareholders in 13 years following release of strong half-year 2018 results.
DNO announced revenues of US$289 million which were up 83 per cent from the same period last year. The Company also reported a net profit of USD 61 million and free cash flow of USD 142 million during the first half of the year.
The planned annual dividend distribution of NOK 434 million (US$50 million), payable in two tranches, is subject to shareholder approval.
"With growing production and robust and reliable revenues, the dividend announcement underscores confidence in our strong growth prospects," said DNO's executive chairman Bijan Mossavar-Rahmani. "Kurdistan is back and so is DNO," he added.
The plans to fast track development of the Peshkabir field is expected to boost output by another 15,000 barrels of oil per day (bopd) to 50,000 bopd by yearend.
DNO has three rigs operating across its licenses with a fourth to be added next month. Two rigs will be active at the flagship Tawke field to reverse natural field decline through workovers and the drilling of two wells in the main Cretaceous reservoir and two wells in the shallow Jeribe reservoir.
Operations will commence at the Baeshiqa license with another rig to be mobilised to spud the first well in September as part of a back-to-back, three-well exploration program. DNO acquired a 32 percent interest in and operatorship of the Baeshiqa license last year, joining ExxonMobil (32 per cent), the Turkish Energy Company (16 percent) and the Kurdistan Regional Government (20 per cent).
Early production and successful appraisal have raised previous field proven (1P) and proven and probable (2P) reserves. Two newly completed wells, Peshkabir-6 and Peshkabir-7, will commence testing by the end of this month before being placed on production. Peshkabir-6 is key to unlocking further Cretaceous and Triassic reserves.
"Peshkabir is proving prolific in production and has generated over USD 300 million in gross revenue since startup last year or three times the investment," said Mossavar-Rahmani.