Harbour Energy plc reported a strong financial performance for the first half of 2022 due to high oil and gas prices and gains in foreign exchange.
FINANCES
Harbour reported total revenue and other income of $2,670 million (H1 2021: $1,496m).
Operating costs per barrel were $14.2/boe (H1 2021: $15.0/boe) with the decrease driven primarily by the increase in production and a foreign exchange benefit of pound Sterling weakening against the US dollar.
EBITDAX amounted to $2,024m (H1 2021: $843m) with higher revenue partially offset by
higher operating costs and benefiting from six months’ Premier production compared with only three months in H1 2021.
The company reported pre-tax profits of $1,490m (H1 2021: $120m) and post-tax profits amounted to $984m (H1 2021: $87m).
Total capital expenditure in the period amounted to $391m (H1 2021: $375m).
Free cash flow was to $1,353m (H1 2021: $302m).
As at 30 June 2022, net debt was $992m (Dec 2021: $2,147m).
Harbour declared an interim dividend of $100m.
SHARE BUYBACK
During the period Harbour also repurchased 11.9m of its own shares for $54m (H1 2021: $nil) as part of a $200m share buyback programme which began on 16 June 2022.
The company also announced it would increase its share buyback programme to $300m.
PRODUCTION
The company reported average production during the period of 211 kboepd (H1 2021: 151 kboepd).
Total recordable injury rate improved to 0.7 (H1 2021: 1.6).
Production split was 53% liquids (2021: 54 per cent) and 47% gas (2021: 46 per cent).
Harbour narrowed its guidance for production to 200 to 210 kboepd for the full year.
PROJECTS
The company began the Tolmount project, which increased UK domestic natural gas supplies by more than 5%.
Harbour also decided to invest in two UK projects of the Talbot development and Leverett appraisal.
A material gas discovery was made at the Timpan prospect in the Andaman Sea (Indonesia).
GUIDANCE
Harbour narrowed production guidance for the year from 195 kboepd to 210 kboepd.
DELEVERAGE
Chief executive Linda Z Cook said the company was increasing investment by 30% at a time when many were struggling with high prices.
“[We are] focusing on doing what we can to deliver reliable, domestic oil and gas from our existing portfolio in a safe and responsible manner.
“In an environment of considerable fiscal, economic and geopolitical uncertainty, our strategy to build a global, diversified oil and gas company focused on safe and responsible operations, value creation and shareholder returns remains valid.
“We are financially strong and have continued to deleverage our balance sheet at pace.
“As a result, we have significant optionality over our future capital allocation including for continued organic investments, meaningful M&A and additional shareholder returns.”