SET-listed oil and gas drilling firm PTT Exploration and Production Plc (PTTEP) reported an 89% year-on-year surge in 2018 net profit, mainly driven by higher sales volume and higher average sales price.
Last year's net profit was registered at US$1.12 billion (35.2 billion baht), up from $594 million logged in 2017.
Higher average sales volume of 305,522 barrels of oil equivalent per day (BOED) in 2018, compared with 299,206 BOED in 2017, came from the acquisition of an additional 22.22% in the Bongkot gas field project, which contributed to cash flow.
After the deal was completed in June 2018, PTTEP held a 66.67% stake in the Bongkot field. The average sales price improved following a rally in global crude prices to $46.66 per barrel of oil equivalent (BOE), a 19% rise from $39.2 per BOE in 2017.
The company's total revenue was recorded at $5.46 billion (177 billion baht) in 2018, while total expenses including tax expense stood at $4.33 billion.
In 2018, the unit cost adjusted upward to $31.7 per BOE as a result of higher royalty expenses from higher sales revenue and increased expenses from the acquisition of an additional stake in the Bongkot field.
PTTEP's financial position remains sound with operating cash flow of $3.27 billion and the earnings before interest, tax, depreciation and amortisation margin registered at 73%.
For 2019, average Dubai crude prices are expected to range between $55-65 per barrel following to a slight shrink in global oil demand outlook attributed to China's economic slowdown and inconclusive trade negotiations between the US and China.
"PTTEP has been granted concessions of two offshore blocks in the United Arab Emirates, marking a significant step in returning to the Middle East, considered as a strategic investment destination," said PTTEP president Phongsthorn Thavisin.
Mr Phongsthorn said the company will speed up foreign direct investments for key pre-sanction projects, especially the Mozambique Rovuma Offshore Area 1.
Besides strengthening the company's exploration activities of its projects particularly in Myanmar and Malaysia, PTTEP is also seeking new investment opportunities in Southeast Asia and the Middle East to support long-term growth and enhance petroleum reserves for the company, he said.
After winning the Bongkot and Erawan concession bids late last year, PTTEP is preparing to sign profit-sharing contracts and will proceed with the transition and investment plans, he added.
PTTEP shares closed yesterday on the SET at 121 baht, up 2.50 baht, in trade worth 3.43 billion baht.
