Harbour Energy PLC (LSE:HBR) reported production in line with expectations, whilst its financial results statement reflected a business in steady state ahead of its next phase of consolidation.
Harbour, which was formed in 2021 through the combination of London-listed Premier Oil and private equity North Sea firm Chrysaor, is now working to close its deal to acquire $11.2 billion of upstream assets from Germany’s Wintershall.
Adding substantial operations in Norway, Germany, Argentina and Mexico to its existing portfolio of assets in the North Sea, Asia and Africa, the deal promises to create “one of the world's largest and most geographically diverse independent oil and gas companies”
The company, today, noted “significant progress” toward closing the transaction.
It expects to publish a prospectus and hold necessary shareholder meetings in the second quarter, and it is progressing through its checklist of regulatory and legal approval processes.
It has, so far, successfully received approval from certain bondholders, as needed, and has successfully agreed syndication for financing facilities.
Harbour said it continues to expect the deal’s completion by the end of 2024.
In regards to its current business, the company reported average production of 186,000 barrels of oil equivalent per day, noting an average operating cost of $16 per barrel – with both metrics described as within guidance and forecast.
Revenue was reported at $3.7 billion, down from $5.4 billion, with the company citing the reduction from exceptionally prior high gas prices for the decline.
Profit before tax reduced to $600 million, from $2.5 billion, and after-tax adjustments the company reported a $32 million profit.
Chief executive Linda Cook, in her accompanying comments, highlighted Harbour’s cash flow generation, as well as its growth opportunities and carbon capture and storage (CCS) projects.
"Harbour materially advanced its strategy during 2023,” she said in the statement.
“We improved our safety performance, generated material free cash flow, and progressed our international growth opportunities and CCS projects, while maintaining our capital discipline.
“This enabled continued shareholder returns over and above our base dividend while retaining the flexibility that allowed us to announce a transformational acquisition in December.”
Cook added: "We remain focused on the successful completion of the Wintershall Dea acquisition and the ongoing safe and efficient management of our existing portfolio.
“We are excited about our future as we look to continue to build a geographically diverse, large scale, independent oil and gas company focused on safe and responsible operations, value creation and shareholder returns."