EnQuest chief executive Amjad Bseisu described the twelve months to December 31 as a “transformational year” – thanks to the delivery of Kraken and its deal to acquire stakes in the Magnus oil field and the Sullom Voe oil terminal.
Production averaged 37,405 barrels oil equivalent per day in 2017, down 5.9% on the preceding year, but, looking ahead it sees output between 50,000 and 58,000 boepd for the current year.
“The group delivered the complex Kraken project on schedule and expects full cycle gross capital expenditure to be significantly below budget, while the acquisition of the Magnus oil field and Sullom Voe oil terminal is aligned with the Group's asset life extension capabilities and provides further opportunities for synergies and growth,” Bseisu said.
"Production performance in January and February was strong and the Group expects a material increase in production in 2018.
“This growth, combined with a focus on cost control and a substantially reduced cash capital expenditure programme, should see the group generate increased cash flow, enabling it to manage its liquidity and reduce debt.”
EnQuest reported earnings (EBITDA) of US$303.6mln on US$635.2mln of revenue for 2017, versus US$477.1mln on US$849.6mln of revenue in the previous year.
EnQuest said the reduction in the year-on-year comparatives reflected the favourable impact of its oil price hedging arrangements in the 2016 period. The effective realised oil price averaged US$52.2 per barrel last year, compared to US$63.8 per barrel rate in 2016.
The company generated US$327mln of cash from operations in 2017, versus US$408.3mln in 2016, while capital costs reduced significant in the last year to US$367.6mln down from US$609mln.
Additionally, EnQuest made some US$107.2mln worth of impairments in the year.
It ended the year with US$1.99bn of debt.