Afren posts record annual results

Oil and gas company Afren said it achieved record annual results boosted by strong production growth.

The London-listed group, which primarily operates in Nigeria, posted 2012 pre-tax profits of $594m, an 169% increase on the prior year's $221m.

Revenues increased 151% year-on-year to $1.5bn from $597m as production grew 123% with an exploration and appraisal (E&A) success ratio of 88%.

Cash flow from operations soared 177% to $935m from $338m.

"In 2012 we achieved record financial results driven by strong production growth at our greenfield developments offshore Nigeria," said Chief Executive Osman Shahenshah.

"We realised an E&A success ratio of 88% and a 2P [proven] reserves replacement ratio of 265%."

The company's production growth was driven by operations on the Ebok and Okoro fields, offshore Nigeria, and the benefits of continued high oil prices.

During the year, Afren made three significant discoveries at the Okoro Field Extension and Ebok North Fault Block and at the Ain Sifni PSC in the Kurdistan region of Iraq.

Alongside its annual results, the company announced the acquisition of a beneficial interest in First Hydrocarbon Nigeria Company. Afren said it will buy 10.4% of the issued share capital for $37.05m.

The acquisition is in line with the firm's plans to expand its operations in Nigeria this year.

"With numerous opportunities for growth, 2013 promises to be another year of achievement for Afren and we are well placed to continue to deliver superior returns for our shareholders," the group said in a statement.

Shares rose 1.49% to 149.80p at 08:50 Monday.

RD