Lundin profitable in 2Q. Curbs production guidance

Lundin Petroleum, a Swedish independent oil and gas exploration and production company, has reported a profitable second quarter of the year with a net profit of $59.9 million, versus a $2.4 million loss for the second quarter of 2014.

Revenues fell to $157.8 in the second quarter of 2015 from $225.4 million in the corresponding quarter of 2014.

According to the company, the decrease was mainly due to lower oil prices and a higher financial expense as a result of the strong US dollar during the reporting period generating a foreign exchange charge, partially offset by a five percent increase in production.

In the company’s report for the six months ended June 30, 2015, Lundin President and CEO, Ashley Heppenstall, said: “I am pleased to report that, despite the challenging market conditions in the oil and gas industry particularly relating to low oil prices, Lundin Petroleum is on track to meet our 2015 objectives of first oil from Edvard Grieg and the go ahead of the Johan Sverdrup project.”

Regarding his decision to step down from his executive position with the company, effective as of October 1, 2015, Heppenstall said: “I announced recently that after 13 years as President and CEO of Lundin Petroleum I would be stepping down from executive duties with the Company so this will be my last Letter to Shareholders.

“I will remain on the Board and as a shareholder. I have worked for the last 20 years with Alex Schneiter, the new President and CEO, and I fully support his appointment.”

Revised production guidance

According to Lundin CEO, the company’s 2015 production guidance has been revised to 32,000 barrels of oil equivalents per day from a previous forecast of between 41,000 and 51,000 boepd.

Heppenstall said:“We have however revised our 2015 production guidance to 32,000 barrels of oil equivalents per day predominantly as a result of the Brynhild revised production forecast and the delay of the installation of Edvard Grieg topsides. This revised forecast assumes only a limited contribution from Edvard Grieg due to the assumption of first oil in late December 2015.”

He explained that following the completion of the Edvard Grieg topsides, the company had to wait a couple of months for the arrival of the “Thialf” heavy lift crane which impacted the company’s production guidance.

“The delay in arrival of the heavy lift crane has pushed our expected first oil date from early fourth quarter to end fourth quarter with a consequent impact on our 2015 production guidance.”

According to Lundin, average daily production in the second quarter of 2015 rose amounting to 28.9 Mboepd compared to 25.4 Mboepd over the same period in 2014.

Offshore Energy Today Staff