Serica Energy PLC (AIM:SQZ) reported £312mln of first-half operating cash flow, up from £72.8mln, boosted by higher production volumes and higher oil and gas prices
The independent North Sea producer saw interim profit after tax balloon to £116.7mln, from £1.3mln last year.
“Serica's production levels in the first half of 2022 have benefitted significantly from our ongoing capital investment campaign which commenced in 2020,” said chief executive Mitch Flegg.
“Over 85% of Serica's production is gas, providing much needed domestic energy during a time of heightened concern around the UK's security of supply.”
The financial results for the six months ended 30 June cover the period prior to the introduction of the UK government’s Energy Profits Levy (windfall tax) .
Serica’s average gas sales price was reported at 136p per therm, compared to 50p, with its overall average realised sales price marked at US$101 per barrel of oil equivalent up from US$43.30 in the same period last year.
It noted ongoing volatility in gas pricing, with the company seeing prices swing between 100p and 300p per therm during the first half. The company operating costs were maintained at just over US$16 per barrel.
The company also noted that its profitability was partially offset by hedging (which effectively capped the top sales prices), and, it noted that the unhedged portion of its sales will now increase as its remaining hedges expire.
Serica produced some 26,600 barrels oil equivalent per day in the first six months of 2022, from 18,855 boepd in H1 2021.
The company narrowed its production guidance to 26,000 to 28,000 boepd.
It today also announced its first interim dividend, of 8p per share, following a 9p per share final dividend for 2021, with the next shareholder payment due in November.