Dragon Oil delivers record interim results as profits rise by 34%

OIL exploration company, Dragon Oil has delivered a record set of interim results for the first half of 2008 and said it is on course to generate significant production growth for the year as a whole.

Although Dragon is headquartered in Dubai and is 52% owned by the Emirates National Oil Company, the company is registered in Ireland and has a dual stock exchange listing in Dublin and London.

Pre-tax profits for the first six months of the year were up — on a year-on-year basis — by 34% to $166.9 million (€112.7m).

Operating profit rose by 35% to $200.2m and revenue was up by 63% on the same period of last year at $373.5m. At 32.54c, first-half earnings per share showed a 34% improvement on the first half of last year.

Earlier this week, Dragon told shareholders that initial testing on the A/129 development well at its Dzheitune project in the Caspian Sea, off the coast of Turkmenistan, has yielded a combined rate of 2,123 barrels of oil per day (bopd). The company said that drilling at the 22/130 well is scheduled for October and a further development well will be drilled in the area — going under the name A/131 — will be completed in November.

One of the more healthy stocks on the Iseq during the past week, Dragonfinished yesterday up by another 9c — or 2.26% — to €4.08 on what was a broadly well performing day for the Dublin market, as a whole.

Dragon’s capital expenditure was 39% higher in the first half of this year than was the case in the same period of 2007, rising to $154.5m. Of this, $89.5m was spent on drilling activities and $65m went oninfrastructure projects.

The company hit its peak production rate of 43,227 bopd at the beginning of June this year.

The company said yesterday that it had no debt at the half-way stage of this year and that it is on course to achieve its desired drilling targets and deliver significant production growth.

It is also involved in the tendering process for up to four new drilling rigs.

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