Abu Dhabi National Energy Company (Taqa), the state-controlled oil explorer and power supplier, swung to a net loss of 421mn dirhams ($114.7mn) in the second quarter as revenues from oil and gas nearly halved, hit by lower prices.
This compares with net profit of 239mn dirhams in the same quarter of last year, Taqa said in a stock exchange filing yesterday.
Revenues from oil and gas fell to 1.59bn dirhams in the second quarter, versus 3.08bn dirhams in the prior-year period. Oil and gas production fell 5% in the first half this year, to 150,000 bpd.
“While the current commodity price environment has impacted the whole industry, our results show that we are delivering on our accelerated cost transformation programme,” Edward LaFehr, chief executive of Taqa said in the statement. Taqa reduced its capital expenditure by 1.05bn dirhams in the first six months of 2015 and is on track to deliver on its previously announced 2.5bn dirhams, or 40%, reduction from last year. Taqa also said it had cut oil and gas headcount by 22% and head office jobs by 32% since July 2014.
“We are well positioned to achieve our targeted 1.5bn dirhams of annual savings by the end of 2016, and now have the organisational structure and momentum to deliver,” said LaFehr.
The company on Wednesday refinanced $3.1bn of existing revolving credit facilities at improved terms, cutting funding costs, Taqa said, confirming a Reuters report that Taqa was close to sealing the five-year credit facility at lower costs.
Taqa began full commercial operations at its Gas Storage Bergermeer project in April, providing 4.1bn cubic meters of capacity. It will also be commissioning three power plants, in Ghana, India and the UAE, before the end of the year, it said.
Taqa, 75% owned by the government of Abu Dhabi, posted a net loss of 3.01bn dirhams for 2014.