RAK Petroleum subsidiary DNO's profit doubles in second quarter

DNO said profit in the three months to the end of June more than doubled from a year earlier and the company predicted rising output from its main oil-producing asset in the Kurdish region of Iraq in the second half of the year.

DNO, which is controlled by the UAE’s RAK Petroleum, said earnings before interest, tax, depreciation and amortisation (ebitda) was US$29.5 million, more than double the previous quarter’s $12.3m.

The improvement was the result of both rising revenue and lower costs.

Revenue in the quarter was up 12 per cent year on year at $61.2m, and was up in the first half of the year by $30m at $110.8m.

The company said its main Tawke oilfield in the Kurdish region is expected to raise production capacity from 120,000 barrels per day to 135,000 bpd in the second half of the year after new wells are drilled.

DNO has struggled from falling oil prices and lack of payment from the Kurdish regional government but is one of the more financially strong players operating in the region.

Last month, it offered $300m to buy Gulf Keystone Petroleum, which operates the Shaikan oilfield in the Kurdish region, which produces about 40,000 bpd.

Since the KRG started making regular monthly payments to producers earlier this year, their financial positions have improved and DNO said cash on hand at the end of the second quarter was $249m.



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