Burren Energy Profit Rises 69% on Higher Oil Pricesadmin
Burren Energy Plc, a U.K. oil company focused on the Caspian region and West Africa, said profit gained 69 percent in the first half as output rose and higher energy prices boosted revenue.
Net income in the six months to June 30 increased to $140.2 million, or 97.4 cents a share, from $82.9 million, or 57.9 cents a share, a year earlier, the London-based company said in an e- mailed statement today.
“Overall activity in the company is continuing exactly as we set out at the beginning of the year,” Burren’s President Finian O’Sullivan said in an interview.
The company plans to expand its exploration projects in Egypt, Yemen and Oman during the next two years. Burren raised 20 million pounds ($37.5 million) in an initial public offering in December 2003, and has increased revenue almost 20-fold in the past three years as record oil prices lifted earnings.
The shares rose 14.5 pence, or 1.6 percent, to 912.5 pence as of 13:04 p.m. in London, valuing the company at 1.28 billion pounds. The stock price is little changed from the beginning of the year.
“Burren has plenty of cash, but not enough opportunities on which to spend it,” Al Stanton, an analyst at Bridgewell Securities in London, said in an interview. “One option could be” a sale of the company, he said. Stanton rates the stock “underweight.”
In July, Burren said first-half oil and gas production rose 17 percent as the company’s working-interest share averaged 33,900 barrels of oil equivalent per day. The company’s oil fetched an average price of $60.90 a barrel in the first half, up 40 percent from a year earlier.
Production in 2006 is likely to average between 33,000 barrels and 34,000 barrels a day, O’Sullivan said today.
Burren also said in July it plans to drill 15 appraisal and exploration wells in the second half of the year; five in Congo, seven in Turkmenistan and three in India.
The company today named Atul Gupta, 46, formerly chief operating officer, to take over as chief executive officer from O’Sullivan, who will become president of the company. O’Sullivan, 51, founded the company in 1994.