SINGAPORE - Upstream oil and gas group KrisEnergy shaved its net loss to US$139.2 million for financial year 2017 from a net loss of US$237.1 million a year ago.
A non-cash impairment of US$120.7 million from the cessation of participation in the Block A Aceh gas project in Indonesia, made to reduce risk exposure, was the main factor contributing to the group's net loss, said KirsEnergy in a Singapore Exchange filing before markets opened on Thursday (March 1).
A near 60 per cent increase in average realised oil price enabled it to maintain year-on-year revenues steady at US$140.7 million from US$142.8 million in the previous year despite a 21 per cent drop in working interest production to 12,745 barrels of oil equivalent per day, mainly due to the G10/48 Wassana oilfield, offshore Thailand.
An uplift came from the more than halving of depreciation, depletion and amortisation charges to US$48.3 million from US$104.5 million a year ago as a result of reduced production and lower asset carrying values following impairment charges recognised in FY16.
Chief executive Kelvin Tang said that although the company welcomed the steady improvement in oil prices throughout 2017, the markets' gyrations in the first two months of 2018 continued to test confidence in the upstream sector and management's ability to plan and commit to capital expenditure.
"In this uncertain environment, our emphasis will remain on safeguarding our balance sheet through cost control, focusing our capital expenditure towards committed expenditures whilst at the same time continuing to maximise oil and gas production."
As such, KrisEnergy said it would focus on its core Cambodian and Thai assets in the Gulf of Thailand, where its oil development projects are less capital intensive and have shorter cycle times, and any mandatory commitment activities as required under our licence agreements.
The group's cash and cash equivalents as at Dec 31, 2017, amounted to US$65.6 million, while the total amount drawn on the revolving credit facility with DBS Bank was US$148.3 million. Unused sources of liquidity amounted to US$65.6 million.
Total debt amounted to US$424.6 million and the group's gearing stood 73.5 per cent.