Sweden's Lundin Petroleum generated a record free cash flow of $663 million in 2018 from $203.7 million in 2017, the company announced on Wednesday.
Alex Schneiter, president and CEO of Lundin Petroleum, said that 2018 proved to be a standout year across all areas of the company's business, with "excellent" performance from producing assets, which resulted in strong financial results and success.
"For the fifth consecutive year, we have ended the period having more than replaced our produced barrels with reserves. Buoyed by stronger commodity prices, operating cost below guidance and very strong production efficiency, we have delivered EBITDA [earnings before interest, taxes, depreciation, and amortization] in excess of $1.9 billion and also record high free cash flow of $663 million for the year," Schneiter explained.
The CEO said that key producing assets, Edvard Grieg and Alvheim in the Norwegian North Sea, continued to perform above expectations.
He noted that production efficiency at Edvard Grieg was at 98 percent for the year while reservoir performance continued to exceed expectations with a significantly slower build-up of water production than anticipated, leading to a six-month extension of plateau production to mid-2020.
"This has been achieved while maintaining an industry leading, low carbon intensity per produced barrel, at about one quarter of the industry world average. Edvard Grieg really is a world-class asset, which epitomizes what can be achieved when excellent reservoir management is coupled with new, modern facilities, which are able to utilize innovative, practical technologies and practices," he said.
Schneiter said that 2018 was a critical year for project delivery at the giant Johan Sverdrup field, which is now less than a year away from start-up.
Phase 1 of the Johan Sverdrup is now approximately 85 percent complete with all four steel jackets having been installed offshore, as well as the topsides for the drilling platform and the riser platform, Schneiter detailed.
He also confirmed that 2019 would be an important year with first oil expected from phase 1 in November 2019.
"Looking forward, 2019 will be one of the most significant years in Lundin Petroleum’s history. The Johan Sverdrup field is set to start production in November and we will deliver our busiest exploration and appraisal program to date, targeting over 750 million barrels of oil equivalent of additional net resources," he added.
By Murat Temizer
Anadolu Agency
energy@aa.com.tr