Zhaikmunai posts Operating Profit of US$ 46.8 mm in 2008.
Results for the year ended 31st December 2008
Zhaikmunai L.P. (LSE: ZKM) (‘Zhaikmunai’), the independent oil and gas enterprise operating in northwestern Kazakhstan, today announces its results for the year ended 31st December 2008.
Financial highlights
- Revenue up 25 per cent to US$135.9 million (2007: US$108.5 million)
- Operating profit down 9 per cent to US$46.8 million (2007: US$51.7 million), due to introduction of Oil Export Duty
- Net income up 78 per cent to US$63.5 million (2007: US$36.3 million)
- Average realised oil price of US$82.53.06/bbl (2007: US$58.71/bbl)
Operational highlights
- Average daily production for the year up to 5,095 barrels per day (2007: 4,823 barrels per day)
- 2P reserves increased from 397 million boe in 2007 to 534 million boe in 2008
- Successful execution of the 2008 drilling program (drilling 9 wells)
Key developments
- Completion of the Rail Terminal near the city of Uralsk
- Completion of the 120km oil pipeline from the Chinarevskoye Field to the Rail Terminal
- Award of production license for oil and gas condensate for over 80% of the license area valid through 2032
- Extension of exploration license over remainder of the license area until May 2011
Post year-end update
- Agreement reached with Zhaikmunai’s EPC contractor, KazStroyService, for the deferral of US$120 million in payments under the construction contract for the Gas Treatment Unit (‘GTU’) to a period following completion of the GTU
- Currently seeking to raise approximately US$300 million in additional financing needed as a result of:
o The final US$100 million under the company’s existing US$550 million facility led by BNP Paribas not having been syndicated;
o The oil price having come down below the level used for modelling; and
o Completion of the GTU being delayed beyond the contractual completion date (currently anticipated completion November 2009).
– EBRD Initial Review of a US$100 million loan to the company obtained and Final Review to be considered shortly. Negotiations with other finance providers are underway.
Commenting on the results, Kai-Uwe Kessel, Chief Executive, said:
“2008 has been a very good year at an operational level with the reported increase in reserves, higher daily production volumes, the completion of some significant construction projects and successful execution of the drilling programme. However, we do anticipate a significant delay in completion of our Gas Treatment Unit. Together with the turmoil in credit markets and the decline in oil prices, this had an impact on our funding position. We are now actively addressing this by seeking additional funding and are confident of reaching a successful conclusion to this exercise by July, 2009.”
Conference call
Zhaikmunai’s management team will be holding a conference call for analysts and investors at 3pm BST on Tuesday May 5, 2009. Dial in details for the conference call and the replay facility, which will be available for one week, are below.
Participants International Dial In: +44 (0) 1452 541 077
Conference ID Replay Details: 97904866
International Dial In: +44 (0) 1452 550 000
Replay Access Number: 97904866#
For further information please visit our website www.zhaikmunai.com or contact:
Zhaikmunai Analysts/Investors
Frank Monstrey, Chairman +44 1624 682 179
Kai-Uwe Kessel, CEO
Jan-Ru Muller, CFO
Media
Brunswick Group LLP: Michael Harrison Carole Cable +44 207 404 5959
Here you can download the pdf-file from this full press release (including the management report).
Notes to Editors
Zhaikmunai is an independent oil and gas enterprise engaged in the exploration, production and sale of crude oil and gas condensate in northwestern Kazakhstan. The Company’s license area is the Chinarevskoye field, which is located in the northern part of the oil-rich Pre-Caspian Basin. Zhaikmunai entered into a Production Sharing Contract with the Republic of Kazakhstan in 1997. Based on a reserve report prepared by Ryder Scott Company L.P., Zhaikmunai’s estimated gross proven plus probable hydrocarbon reserves as at 1 July 2008 were 534 million boe. Zhaikmunai’s GDRs are listed on the London Stock Exchange under the ticker symbol ‘ZKM’.
Forward looking statements
In the interests of providing current and potential investors with information regarding the Company, including the Company’s assessment of its and its subsidiaries’ future plans and operations, certain statements included in this press release may constitute forward-looking information or forward looking statements (collectively, “forward- looking statements”). All statements contained herein that are not clearly historical in nature are forward-looking, and the words “anticipate”, “believe”, “expect”, “estimate” and similar expressions are generally intended to identify forward-looking statements. Many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company. These forward-looking statements made as of the date hereof disclaim any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise.
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- Zhaikmunai results 2008
