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Thursday, January 14, 2016
UAE-based Dana Gas is instituting cost measures, not only at its headquarters but at its operations in Egypt. The cost cutting in Egypt is not based solely on the drop in crude prices but by its accounts receivables balance owed to it by the Egyptian government.
The company and the government of Egypt had set an alternative payment structure, which gave Dana Gas rights to increase production to help recoup outstanding balances over a seven-year stretch, the drop in crude prices is probably not aiding the company in achieving the results intended under the alternative payment structure.
Operationally in Egypt, the company continues to make progress despite the arrears. Dana’s production is now about 34,000 boepd. Contributing to its production were two new wells coming onstream, the Balsam 1 in early November followed by the Balsam 2 in December. The company expects the Balsam-3 to start by mid-year according to company CEO Patrick Allman-Ward.
In addition to the above the company, after a five-year search, has hired a new CFO. Chris Hearne has joined Dana’s executive team. Hearne has a host of experience in the industry previously working for Erin Energy as senior VP and CFO. He was also with Serica Energy, aiding it with its initial public offering.
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