August 29, 2008
Main Financial Indicators at June 30, 2008
|1H 08||1H 07||2007||2006||% 1H 08 vs. 1H 07|
|Average Brent price||$/b||109.1||63.3||72.4||65.1||+72%|
|Average Total Gabon crude price||$/b||102.4||58.5||66.7||59.1||+75%|
|Production from Total Gabon interests||kb/j||60.2||64.3||64.2||67.0||-6%|
|Funds generated from operations||$M||413||256||560||463||+61%|
Production in thousands of barrels per day
(Including the oil tax reverting to the Republic as per the production sharing contracts)
First-Half 2008 Results
The selling price of the Mandji and Rabi Light crude oil grades marketed by Total Gabon averaged $102.4 per barrel in the first half of 2008, up 75% from $58.5 a year earlier, in line with Brent price trends over the period.
Total Gabon’s equity share1 of operated and non-operated oil produced stood at 60,200 barrels per day during first-half 2008. The 6% decrease from the 64,300 barrels reported in first-half 2007 can be attributed to:
- Naturally declining output from certain fields, which was not fully offset by new wells.
- Maintenance turnarounds on Torpille Marine, Grondin Marine and Ile Mandji in January 2008.
- Shortfalls in non-operated production from the Shell Gabonoperated Rabi-Kounga field, accounting for 25% of Total Gabon’s total production change year-on-year, mainly due to:
- Technical problems experienced with Rabi-Kounga field operations.
- The impact of the strike by Shell Gabon personnel, which shut in the facilities between March 20 and April 1 of this year, causing a production loss of 212,000 barrels for Total Gabon.
First-half sales amounted to $1,047 million, up 48% from $706 million in the first half of 2007.
The positive impact of higher selling prices was partly offset by a roughly 12% decline in the amount of oil sold as a result of lower production and liftings.
Net income rose 36% to $251 million from $184 million in first-half 2007.
The impact of increased sales was weakened by higher operating costs ($/€ currency effect, more work at a higher cost, higher production taxes), depreciation (higher spending) and taxes.
Capital expenditure totaled $239 million for the period—nearly twice the amount in first-half 2007—mainly for continued Phase 1 redevelopment of the Anguille field and work on the Torpille field.
Funds generated from operations
Funds generated from operations stood at $413 million at June 30, 2008.
(1) Including the oil tax reverting to the Republic as per the production sharing contracts
First-Half 2008 Highlights
Shareholder’s Meeting and Dividend
At Total Gabon’s Annual Meeting of Shareholders on May 23, 2008 in Libreville, the payment of a net dividend of $31 per share for 2007 was approved, for a total amount of $139.5 million.
The dividend was paid out from June 6, 2008 at an equivalent amount of €19.69, based on the European Central Bank’s rate of €0.6352 per $1 on May 23, 2008.
- Diaba License: 21.25% interest sold to Cie Gabon Diaba Ltd and 2D seismic survey conducted
On February 26, 2008, Total Gabon announced the sale of a 21.25% interest in the Diaba license to Cie Gabon Diaba Ltd, an affiliate of Cobalt International Energy of the United States.
The transaction was approved by the Gabonese authorities and took effect on January 1, 2008. Under the agreement, Total Gabon, operator, retains a 63.75% interest, along with Cie Gabon Diaba Ltd (21.28%) and the Gabonese Republic (15%).
To comply with its work commitments, Total Gabon acquired 2,126 kilometers of 2D seismic between February 25 and March 19, 2008.
Seismic data processing will continue to 2009.
Drilling of the Aloumbé deep exploration well ALP001 began on April 29, 2008 and is expected to continue until October 2008, not including tests and stimulation. Aloumbé is a potentially large gas prospect. The main purpose of the well is to reduce uncertainties about productivity from the tight sands, high-pressure reservoir.
The Mérou Marine 3 (MRM-3) exploration well in the Baudroie Mérou Marine license was drilled between April 2 and 27, 2008. The well encountered poor quality Anguille reservoirs and was plugged and permanently abandoned.
On February 28, 2008, Total Gabon announced that it had begun redeveloping the Anguille field.
Phase 1 is under way and consists of drilling around a dozen wells over the period 2007-2008, carrying out hydraulic fracturing to improve well productivity, and increasing the capacity of the associated surface facilities. In first-half 2008, six wells were completed and five stimulation operations carried out.
Production is expected to increase from 2008, peaking at around 30,000 barrels per day in 2013-2014. The capital expenditure is an estimated $2 billion, for additional proved and probable reserves of around 150 million barrels.
Field models for Anguille Nord Est, Hylia, Torpille, Gonelle (Mandji oil), and Atora (Rabi oil) continued to be upgraded.
Non-Operated Activities (Shell Gabon-operated Rabi-Kounga field)
- Shell Gabon strike
Due to a srike of Shell Gabon employees, the Shell Gabon-operated Rabi-Kounga field and Gamba oil terminal facilities were shut in between March 20 and April 1, 2008. They were gradually brought back on stream from April 2, 2008.
On April 9, 2008, Total Gabon signed a $600-million financing agreement with a syndicate of top-ranked international banks. The eight-year agreement is subject to the standard terms and obligations for this type of financing and will enable Total Gabon to fund its multi-year investment program, in particular the Anguille redevelopment project.
The amount of drawdowns totaled $107 million at June 30, 2008.
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