Genel forecasts lower revenue; shares sink
LONDON, January 20, 2016
Genel Energy, one of the main oil producers in Iraqi Kurdistan, forecast lower revenue and production for this year, hurt by weak oil prices, sending its shares down to a record low on Wednesday.
The company forecast revenue of $200 million-$275 million for 2016, assuming Brent oil price at $45 per barrel. Genel reported revenue of $342 million for 2015.
Genel also forecast this year's production at 60,000-70,000 barrels per day (bpd). The higher end of the range was 17.5 percent lower than the 84,900 bpd that it produced on average for 2015.
Oil producers across the globe are trying to deal with the financial fallout of a sharp decline in crude prices.
Crude futures slumped again in Asian trade on Wednesday, with US oil dropping more than 3 percent towards $27 a barrel and its lowest since 2003, on worries about global oversupply.
However, the company said it was well-positioned to weather the downturn in oil prices as its production cost was $2 per barrel and due to recent efforts at cutting capital expenditure and overhead expenses.
The London-listed company, which was owed $409 million by the Kurdistan Regional Government (KRG) for oil exported from the region as of October, said it received almost $100 million in four consecutive payments.
Genel shares fell as much as 9.3 percent to a record low of 112.50 pence in early trading. --Reuters
