- 19 Mar 2009
TAQA Full Year 2008 Financial Results
Revenues grow 102% to AED 16.4 billion and profit exceeds AED 1.8 billion
TAQA Board recommends a 15% Cash DividendAbu Dhabi, United Arab Emirates – Abu Dhabi National Energy Company PJSC, a publicly listed company on the Abu Dhabi Securities Exchange (ADX: TAQA), today reported financial results for the full year 2008.Key highlights of the results for the full year 2008:Upstream and Midstream•Upstream and Midstream activity generated revenues of AED 8 billion (comprising oil and gas and gas storage), 47% of total revenues and contributing 46% of net profit.
•Average daily production was 114,1 mboe in 2008, split between TAQA Energy (6.7 mboe), TAQA Bratani (13.7 mboe) and TAQA North (93.7 mboe).
•Average net realized price of crude oil sold was US$83.39 per barrel for TAQA North, US$112.88 per barrel for TAQA Energy and US$70.49 per barrel for TAQA Bratani.
•Average net realized price for natural gas sold was US$8.16 per thousand cubic feet for TAQA North, US$10.45 per thousand cubic feet for TAQA Energy and US$6.24 per thousand cubic feet for TAQA Bratani.
•Drilling success rate of 99.7% for TAQA North.
•Results represent significant growth, following the successful integration of TAQA’s acquisitions in 2008.Downstream•Downstream activities generated revenues of AED 5.5 billion in 2008, excluding supplemental fuel, comprising 33% of total revenues in 2008, and 54% of net profit.
•TAQA’s downstream capability now represents total global generation capacity (gross) of 10,514 MW.
•In 2008, TAQA produced a total of 47,704 GWh in 2008, compared with 48,229 GWh in 2007, a fall of 1%.
•TAQA’s total water desalination in 2008 was 191,150 MIG, with a capacity of 594 MIG.
•Power and water in the UAE accounted for a total of 79% of the total revenue.
•Technical availability of power generation businesses averaged 93% with an average capacity of 71%.Finance•Cash and cash equivalents as at 31 December 2008 was AED 4.1 billion, compared with AED 7.4 billion for 2007.
•Finance costs increased from AED 2.5 billion to AED 3.8 billion, to fund acquisitions.
•TAQA’s undertook a bond buy back programme in 2008 totalling AED 1.0 billion
•At 31 December 2008, the Group had available AED 8.4 billion (2007: AED 3.8 billion) of undrawn committed borrowing facilities in respect of which all conditions precedent had been met.Key highlights of the results for Q4 2008: oRevenue from oil and gas activities (including gas storage) grew 60% to AED 1.4 billion, compared with AED 0.9 billion for the same period in 2007. This increase reflects the acquisition of upstream assets in North America and Europe in 2008. Lower average oil and gas prices experienced during the period have impacted on revenue.
oAverage daily production was 118.9 mboe, split between TAQA Energy (6.0 mboe), TAQA Bratani (19.1 mboe) and TAQA North (93.8 mboe).
oAverage net realized price of crude oil sold was US$43.48 per barrel for TAQA North, US$41.04 per barrel for TAQA Energy and US$54.08 per barrel for TAQA Bratani.
oAverage net realized price for natural gas sold was US$5.93 per thousand cubic feet for TAQA North, US$11.95 per thousand cubic feet for TAQA Energy and US$7.02 per thousand cubic feet for TAQA Bratani.
oRevenue from the electricity and water business, excluding supplemental fuel, grew by 18% to AED 1.5 billion, from AED 1.3 billion for the same period in 2007.In a Board meeting held on March 18, 2009, the Board of Directors of TAQA have recommended a cash dividend of AED 0.15 per share on all outstanding shares. This recommendation will be submitted for shareholder approval at TAQA’s Annual General Meeting to be held on April 21, 2009.CommentPeter Barker-Homek, Chief Executive Officer of TAQA, said:“Following acquisitions by TAQA North in Canada and TAQA Bratani in the North Sea, 2008 was a year in which we began to execute upon our long-term strategic objective of building a diverse and equally distributed asset base in North America, Europe and the Middle East. The extension of our footprint brought with it significant new experience as an operator, upon which we continue to build.Our diversification strategy has ensured that while the group benefited from the high oil price due to our expanded upstream operations in the first half of 2008, the strength of our midstream and downstream businesses helped to offset the sharp drop in oil prices in the second half of the year. We continue to have real confidence in the long-term growth prospects of the company in spite of short term pricing environment fluctuations, but will be prudent in taking on new projects and ensure that we are carefully controlling costs across the business – ultimately protecting profitability.During the course of 2008, we have acted promptly and decisively in uncertain and volatile financial markets. As a result, TAQA is well capitalised with no short term funding requirements and significant available liquidity. This positions us well to continue to fulfil our long-term growth objectives throughout 2009 and to benefit from the opportunities that the market may present.”Corporate activity during the periodJanuary 2008 marked TAQA’s completion of its Cdn$5 billion acquisition of PrimeWest Energy Trust. TAQA North is now one of the top ten companies in Canada in terms of net proven natural gas reserves and in the top 12 companies in terms of oil and gas production.In January 2008, TAQA agreed to a US$3.1 billion, one-year credit facility to partially finance the PrimeWest acquisition. The one year facility was refinanced in August 2008 and syndicated to multiple international lenders with a term of three years.At its AGM in April 2008, TAQA declared a dividend of AED 0.10 per share to its shareholders.In June 2008, TAQA announced the issuance of AED 4.15 billion (US$1.1bn) of convertible bonds which converted into common shares on 1 September 2008. The new shares commenced trading on the Abu Dhabi Securities Exchange on 16 October 2008.On 7 July 2008, TAQA announced that TAQA Bratani had signed a Sale and Purchase Agreement with Shell U.K. Limited and Esso Exploration and Production (UK) Limited to purchase the equity pertaining to operating licenses for six offshore fields in the UK North Sea. The fields’ average daily production in the region of 40,000 barrels of oil equivalent (boe) represents a significant increase to TAQA’s existing European footprint. The US$438 million acquisition closed on the 1st December 2008.In July, TAQA issued US $1.5 billion of notes under its Medium Term Note program. The offering consisted of US $1.0 billion of five year notes maturing in 2013 and US $0.5 billion of 10-year notes maturing in 2018.In September 2008, as part of TAQA’s portfolio optimisation, the group sold a 20% interest in Shuweihat CMS International Power Company and a 50% interest in Shuweihat O&M Limited Partnership to Sumitomo Corporation. TAQA retains a 54% stake in this plant.In December 2008, TAQA, and the Bergermeer project consortium, signed a Memorandum of Understanding with Gazprom, in respect of cushion gas for the Bergermeer gas storage facility. The gas storage facility will enhance the security of energy supply to Dutch and European consumers and will contribute significantly to the liquidity of the North-West European gas markets.December 2008 also saw TAQA and RBS Sempra Commodities announce the creation of TAQA Gen X, a joint venture focused on investments in the downstream energy business in North America. Simultaneously, TAQA Gen X announced its first investment in a tolling agreement for the Red Oak power plant, an 830 MW combined cycle gas turbine plant, located in Sayreville, New Jersey, USA. TAQA Gen X will play an active role in ensuring the long-term power demands for the region continue to be met.Note on comparative data Since the beginning of 2007, TAQA has completed a number of acquisitions which have been fully or partially consolidated into the period under review. In Q2 2007, TAQA completed the acquisition of CMS Generation, contributing two months of revenue to that quarter. In subsequent months TAQA acquired Northrock Resources and Pioneer Canada, significantly increasing the company’s upstream assets. The largest company acquisition to date, PrimeWest, was completed on January 16, 2008. The effect of these acquisitions should be considered when making year-on-year comparisons.- ENDS -Contact Information for Media:Allan Virtanen
TAQA Media Relations, Abu DhabiTel +971 2 691 4894; Mob +971 56 685 2717
Allan.Virtanen@taqaglobal.comAbout TAQAEstablished in 2005, TAQA is a diversified international energy group headquartered in Abu Dhabi, the capital of the United Arab Emirates, and listed on the Abu Dhabi Securities Exchange (ADX: TAQA).TAQA’s business is made up of three operating divisions spread across the entire energy value chain: power generation & water desalination; oil and gas exploration & production; and emerging & alternative energy technologies.Power & Water: TAQA is one the largest independent power producers in the world and the majority owner of the facilities that provide 98% of the water and electricity requirements in Abu Dhabi. TAQA’s power plants are located in the UAE, Morocco, Oman, Saudi Arabia, Ghana, India, and USA.Oil & Gas: with operations in Canada, UK, the Netherlands, USA and Iraq, TAQA’s oil and gas business includes exploration and production, underground gas storage and pipeline transportation.Emerging & alternative energy technologies: TAQA Energy Solutions is dedicated to alternative and technology-driven energy initiatives for long-term efficient energy production and generation. TAQA’s vision is to deliver ‘Energy for Growth’: growth within the business; social and economic progress in the communities where TAQA operates; and increased value for our shareholders.Over the past 40 years the UAE and Abu Dhabi have pursued a vision embodied by progressive development, investment and the highest global standards. TAQA is proud to align its strategy both domestically and globally to Abu Dhabi’s economic vision 2030, working towards sustainable economic development. For more information about TAQA visit: www.taqaglobal.com or Twitter: @TAQAGLOBAL