Abu Dhabi National Energy Company (Taqa) has posted a net profit of Dh435 million ($118.42 million) for the second quarter of the year, as against a net profit of Dh171 million for the same period last year, marking a rise of 154 per cent.

The company benefited from higher oil prices and a quarterly increase in UK production, along with higher Power & Water revenue from the Fujairah 2 plant, it said in a statement.

Taqa has also made progress on its key growth projects in Morocco, the Netherlands, Ghana and India.

Taqa’s cash position and liquidity remains strong with over Dh4.0 billion in cash and cash equivalents, plus Dh11.7 billion in undrawn facilities, as of June 30, the statement said.

“Taqa’s performance during the second quarter of this year has been strong – both operationally and financially. A consistent and solid operational performance combined with a more favourable commodity pricing has delivered a net result for the first six months of 2011 of which we can be proud,” said Carl Sheldon, general manager of Taqa.

“Quarterly performance aside, we remain firmly committed to our longer term vision for growth across our key markets. We have made clear that our future will be largely driven by the organic growth opportunities we identify and harness in our existing footprint.”

“Our asset base is already growing as a result of the success in our North American and UK North Sea drilling programmes and all other growth projects have made pleasing progress this quarter. In particular, construction started this year at Jorf Lasfar plant in Morocco for the 700 MW expansion,” he added.

“This combination of a positive quarterly performance, and continued investment in Taqa’s future, gives me confidence as we move through an exciting period in the company’s development.”

Stephen Kersley, chief financial officer of Taqa, said: “During the quarter, steady production in our Oil & Gas business has enabled Taqa to capture the benefits of a higher commodity price environment, while carefully controlling operational expenditure.”

“This was supported by higher contributions from the power and water business due to contributions from Fujairah 2. The result was an increase in gross profit which, in turn, had a direct and positive impact on our bottom line.”

“Consistent delivery against our internal targets continues to enhance our overall financial position. Taqa has good available liquidity and a strong cash position, leaving us with ample headroom to continue investing in our organic growth projects and the future of the company,” Kersley added.

Total revenues for the second quarter (Q2) of 2011 were Dh7.1 billion, 38 per cent higher year-on-year, compared with total revenues of Dh5.1 billion in Q2 2010.

Total oil and gas revenues (including gas storage and other income) increased from Dh2.0 billion to Dh3.1 billion for Q2 2011. This 54 per cent increase versus the same period last year was primarily driven by the increase in crude oil prices, plus higher production in the UK North Sea.

Total Power & Water revenues, excluding supplemental fuel income, increased from Dh1.6 billion in Q2 2010 to Dh1.9 billion in Q2 2011. This 17 per cent year-on-year increase was primarily due to the contribution from Fujairah 2, which was transferred to Taqa in the third quarter of 2010 and fully commissioned in January 2011.

Supplemental fuel income increased 38 per cent year-on-year due to higher use of alternative fuel supplies at Taqa’s domestic power plants.

Other operating revenue increased due to higher transportation revenues in Canada and the Netherlands.

Cost of sales increased 25 per cent from Dh3.7 billion to Dh4.6 billion. Within this, fuel expenses increased in line with supplemental fuel revenues. Operating expenses increased by 27 per cent, while depreciation, depletion and amortisation increased 21 per cent reflecting Taqa’s increased asset base.

Profit before tax was Dh1.4 billion, 151 per cent higher year-on-year, due to higher revenues as a result of the oil price, plus tight control over operating expenses. – TradeArabia News Service