DUBAI, (Reuters) – United Arab Emirates-based Dana Gas, the Middle East’s first privately owned natural-gas producer, said first-quarter revenue — mainly from its Egyptian operations — rose 35 percent on higher prices.
Revenue was 272 million dirhams, it said in a statement. Net income in the three months to March 31 was up 19 percent to 25 million dirhams ($6.81 million), compared with 21 million dirhams in the year-earlier period, said the Sharjah emirate-based company.
“The growth was mainly driven by an increase in oil prices that have resulted in high returns,” Finance Director Neeraj Agrawal told Reuters.
Shares of Dana, which are listed in the UAE’s Abu Dhabi emirate, were unchanged at 0550 GMT. Its stock has fallen 6.9 percent this year, after rallying almost 39 percent in 2007.
Kuwaiti investment bank Global Investment House this month started coverage of Dana with a “buy” rating and a price target of 2.86 dirhams per share. The stock last traded at 2.03 dirhams.
First-quarter output at Dana’s Egyptian gas fields held steady at about 30,000 barrels of oil-equivalent per day (boepd), Agrawal said. The rate is not expected to change this year, he said.
A project to produce and process gas in Iraq’s Kurdish region is expected to be completed by the end of July and contribute to profit in the third quarter, he said, without being more specific.
The company, which attracted $78 billion of funds when it sold shares in an 2005 initial public offering, is due to award a construction contract to the Egyptian Bahraini Gas Derivatives Co to build a $75 million liquefied petroleum gas plant in the second quarter, from which production will start by the end of next year, Agrawal said.
Dana Gas said in January it plans to invest about $500 million in Egypt and Iraq’s Kurdish region this year.
Privately owned Crescent Petroleum, a shareholder in Dana, is expected to start receiving gas from Iran as soon as the Iranians complete the final phase of offshore infrastructure, Agrawal said, denying reports of a price dispute.
“We think they will complete the final phase by the third quarter,” he said. “There is no price dispute because there is a binding agreement … but Crescent is now negotiating ways to get more quantity of gas to get a better price.”
Last month, Iranian Oil Minister Gholamhossein Nozari minister said the country was serious in its threat to use domestically the gas it planned to Crescent if a long-running dispute with the firm over price was not resolved.
Iran and Crescent, also based in Sharjah, have been locked in negotiations about the price of gas exports from the Iranian offshore Salman field to the UAE since 2006.
“No one has reacted positively or negatively to the results,” EFG-Hermes analyst Amr Diab said. “People are still waiting for the Iran deal to materialise.”