Lundin Energy posts its best first-quarter revenue on record, according to the accounts released Wednesday morning. At the same time, the Swedish company confirms that the merger with Aker BP has received the go-ahead.
Photo: Lundin Energy Norway
At the end of June, the planned execution of the merger between Lundin Energy and Aker BP is expected to fall into place.
This is among the biggest news in connection with the new quarterly results posted by Lundin Energy (formerly Lundin Petroleum). This much is clear after shareholders of both companies have given the nod to the merger plans.
The stage is therefore set for what will be the second-largest Norwegian oil outfit after Equinor – and for what the parties contend will be ”the leading European independent E&P company”. The transaction plans – formally entailing an acquisition of Lundin Energy – were announced shortly before Christmas, valued at NOK 125bn (EUR 12.7bn).
The quarterly results also show that Lundin beat its own record on the item for revenue and other, landing USD 1.98bn in Q1 against USD 1.11bn in the same period last year. Comparing the two quarters in terms of production, this year’s Q1 output was slightly higher at 194,000 barrels a day against 190,300 last year.
”Our business continues to deliver on all fronts, with strong production and financial performance in the first quarter of 2022. Our world class assets continue to outperform, with production during the quarter towards the top of the guidance range and with industry leading low costs and low carbon emissions,” says Chief Executive Officer Nick Walker in a comment on the report.
Heavyweight Johan Sverdrup
Also featured in the equation is that the price environment has been much more favorable in the first months of 2022 than than the first months of 2021, given that both oil and gas prices have reached seldom seen heights. And having a share of the Johan Sverdrup serves only to boost earnings.
”Johan Sverdrup continues to exceed expectations. The Phase 2 processing platform was successfully installed on schedule and the project is on target to achieve first oil in the fourth quarter of 2022, which will boost production to 755 million barrels of oil equivalent gross,” states Walker and says about the quarterly results:
”Financially we had a very strong quarter, with record revenue of USD 1.98bn, delivering significant free cash flow of USD 822m, allowing us to further reduce net debt to USD 2.1bn.”
Lundin Energy has realized oil prices of USD 104 per barrel in the first quarter. In the beginning of the year, the company reported that it would raise its dividend by 25 percent to USD 0.5625 per share. Lundin will stick to this plan in connection with the published accounts – until the merger with Aker BP takes effect.
The revenue growth hasn’t directly translated to bottom-line growth. Lundin Energy’s adjusted net result lands slightly below the result from Q1 of 2021 with Q1 2022 profit of USD 468.5m against USD 493.8m.
(This article is provided by our sister media, EnergyWatch)
English edit: Christoffer Østergaard
