Afren Plc (AFR), a UK-based oil explorer concentrated on Nigeria and Iraq, said profit will remain at a record-high this year as amplified production from Iraq’s Kurdistan region helps the company benefit from advancing crude prices.
Sales probably above doubled to around $ 1.5 billion last year after output soared to 42,830 barrels of oil equivalent a day, the London-based company expressed in a statement. Afren has expectation to pump as much as 47,000 barrels a day this year, it said, excluding Iraqi production from the total.
Galib Virani, who is the associate director at Afren, said over phone that the revenue and net operating cash flow must be at least what it is in 2012 if not showing some growth. He said that they will see increase on the top line based on conservative production guidance.
Oil traded in New York has gained above 20 $ in seven months, last week capping the longest weekly winning streak in 14 months as House Republicans planned a vote on expanding the US borrowing authority. Rising prices may increase revenues from Kurdistan, where Afren has said it may beat production guidance with additional volumes from the Barda Rash project.
Afren rose 2.7 % close at 138.7 pence in London dealing. The shares jumped 53 % last year.
Tom Robinson, who is an analyst from London at Nomura International Plc, wrote down in an e-mailed report that providing output guidance for 2013 excluding Kurdistan highlights the risk of ramp-up from the region. He also said that increase outside Kurdistan is expected to be more modest this year.
The firm has expectation of lifting investment in all its projects by about a fifth to $ 620 million this year. It plans to drill 14 exploration and assessment wells, targeting more than 670 million barrels of gas and oil resources.