Revenues dip at Corrib Gas operator to €205m

Vermilion became the country’s largest provider of domestic natural gas when it acquired Equinor’s 36.5% interest in Corrib Gas

Production at Corrib Gas was hit in the third quarter of last year due to planned maintenance downtime.

Revenues at Corrib Gas operator Vermilion’s ‘high margin’ Irish business last year dipped by 6.7% to C$302.4m (€205.1m).

That is according to the 2023 annual report for the Canadian-headquartered Vermilion Energy.

The report confirms that production at Corrib Gas was hit in the third quarter of last year due to planned maintenance downtime.

The revenues of C$302.4m for 2023 compare to revenues of C$324.34m for 2022, a drop of C$21.94m.

However, 2023 revenues remained 41% ahead of 2021 revenues, which stood at C$214.4m.

After the outbreak of the war in Ukraine in February 2022, Vermilion benefited, like other energy producers, from the sharp increase in gas prices.

Vermilion’s annual report refers to “premium priced European gas”.

The price of gas did decline last year and this contributed to global revenues at Vermilion declining by 36.7% from C$3.476bn to C$2.2bn.

The Corrib gas field contributes up to 29% of Ireland’s natural gas consumption and 100% of the country’s gas production.

The Corrib field is located around 83km off the coast of Co Mayo, in 350m of water. The distance from the seabed to the Corrib reservoir is a further 3,000m.

The annual report shows that operating expenses at the firm’s Irish unit more than doubled from C$16.58m in 2022 to C$39.46m last year.

Transportation costs at the Corrib Gas project for Vermilion nearly doubled from C$3.57m to C$7.09m.

At the end of March last year, Vermilion became the country’s largest provider of domestic natural gas here when it acquired Equinor’s 36.5% interest in Corrib Gas, giving it an operating interest of 56.5%.

The report states that the new assets acquired contributed revenues net of royalties last year of C$161.7m and net earnings of $43.6m.

The report confirms that Vermilion paid out C$488.89m (€331.7m) in cash for the 36.5% share of the business.

The C$488.89m in cash is calculated by a value of net assets acquired C$928.38m less a C$439.48m “gain on business combination”.