PRELIMINARY RESULT AS PER 4TH QUARTER 2008
Building values
Petrolia Drilling has during 2008 strengthened its exposure in the drilling market through the investments in PetroMena (51.5%), Venture Drilling (50%), Petrojack (39.95%), Larsen Rig (30%), and PetroProd (16.9 % indirectly through Petrojack). The current situation in the financial markets will impact the industry and available funding going forward.
* Petrolia Drilling has with effect from 1 January 2008 changed presentation currency from NOK to USD. All comparative figures have been converted and presented in USD for information purposes. As a consequence of this, the Company has booked an unrealised currency gain of mUSD 179.3 for the fiscal year 2008 on bond loans nominated in NOK. Total net result after tax was mUSD 90.1 for the fourth quarter 2008 and mUSD 76.9 for the fiscal year 2008.
* PetroMena’s PetroRig I, II and III have an average contract price of mUSD 490 per unit, excluding project- and financing costs.
On 3 February 2008, SS Petrolia started operations under the contract with Pemex. Operating result before depreciation for the
subsidiary PetroMena was mUSD 17.8 for the fiscal year 2008 and net result was mUSD 117.7. The result was positively impacted by an
unrealised USD/NOK currency gain of mUSD147.3 mainly related to debt nominated in NOK.
* Petrojack has had one jack-up rig on contract with Saipem. The put/call option of sale of Petrojack II to Saipem was
completed on the 12th of January 2009 at a sales price of MUSD 198.3.
* Petrojack has had one jack-up rig under construction (Petrojack IV) which was delivered in January 2009.
Larsen Oil & Gas Pte Ltd, as drilling contractor, has on behalf of Petrojack IV Pte Ltd, a wholly owned subsidiary of Petrojack ASA,
signed a drilling contract with PTT Exploration & Production Public Company Limited. Length of contract is 5 years at a rate of USD
151,000 per day. This was commenced on the 23rd of January 2009. Operating profit before depreciation for Petrojack was mUSD 21.3 for
the fiscal year 2008 and the net result was mUSD -63.3.
* Operating profit before depreciation for Venture Drilling was mUSD 71.8 for the fiscal year 2008. Net result after tax was mUSD 56.4.
* Revenues and operating profit before depreciation for Petrolia Services for the fiscal year 2008 totalled mUSD 86.5 and mUSD 35.4
respectively. Drilling equipment is depreciated over five years. Depreciation amounts to mUSD 28.4 for the fiscal year 2008. Book value
of drilling equipment as of 31 December 2008 is mUSD 113.0. Market value is expected to be higher.
* Petrolia Drilling has invested mUSD 42.0 in Larsen Rig and thereby controls 30% of the company, which is building a new deepwater
semisubmersible drilling rig at Jurong Shipyard in Singapore, identical to the PetroMena rigs. The rig is planned to be delivered in
the second quarter 2011.
Financial information
The financial data have been prepared in accordance with the International Financial Reporting Standards (IFRS).
Profit and loss for the fiscal year 2008
Total revenues were mUSD 160.4 for the fiscal year 2008, whereof mUSD 73.6 came from SS Petrolia and mUSD 86.5 came from Petrolia Services. Total revenues for the fiscal year 2007 equalled mUSD 131.9.
Operating profit before depreciation was mUSD 33.4 for the fiscal year 2008 compared to mUSD 65.7 in 2007.
Total operating expenses equalled mUSD 127.0 for the fiscal year 2008 whereof mUSD 39.3 is operating expenses for SS Petrolia, mUSD 51.1 relates to Petrolia Services and mUSD 15.8 is rig expenses for mobilization of PetroRig I. The rest of the operating expenses relates to management services under the contracts with LOG and various other operative and administrative expenses.
Operating profit equalled mUSD 2.2 in the fiscal year 2008, including mUSD 31.2 in depreciation of equipment mainly related to Petrolia Services. Operating profit equalled mUSD 39.1 in the fiscal year 2007, including mUSD 26.6 in depreciations.
The net, after-tax result was mUSD 76.9 in the fiscal year 2008. This includes negative result from investments in associates of mUSD 46.4. In the Petrojack accounts, the sale of Petrojack II has been considered as a financial lease and the net profit has been taken into the accounts in 2008. PDR’s value added on Petrojack II has been included in the net profit for the sale of Petrojack II. The value of Petrojack’s shares in PetroProd is booked at mUSD 0.0 due to negative results from PetroProd.
Venture Drilling contributes with a positive result of mUSD 28.5 after tax. Net financial items of m USD 92.9 include the effect of PetroMena’s change of functional currency from NOK to USD. The USD has appreciated during 2008 resulting in an unrealised currency gain of mUSD 142.6 for the group as a total. The USD has appreciated against NOK from 5.41 as of 1 January 2008 to 7.00 as of 31 December 2008. The net, after-tax result was mUSD 7.3 for the fiscal year 2007.
Profit and loss for the 4th quarter 2008
Total revenues in the fourth quarter 2008 were mUSD 43.9, whereof mUSD 22.3 came from SS Petrolia and mUSD 21.6 came from Petrolia Services. In the fourth quarter 2007, total revenues equalled mUSD 28.8.
Operating profit before depreciation for the fourth quarter 2008 was mUSD 4.9 compared to mUSD 9.0 for the fourth quarter 2007.
Total operating expenses equalled mUSD 39.0 in the fourth quarter 2008 whereof mUSD 11.6 is operating expenses for SS Petrolia, mUSD 12.3 relates Petrolia Services and mUSD 9.1 is rig expenses related to mobilization of PetroRig I. The rest of the operating expenses relates to management services under the contracts with LOG and various other operative and administrative expenses.
Operating loss for the fourth quarter 2008 equalled mUSD 2.0, including mUSD 6.9 in depreciation of equipment mainly related to Petrolia Services. Operating profit for the fourth quarter 2007 equalled mUSD 1.2, including mUSD 7.8 in depreciations.
The net, after-tax result for the fourth quarter 2008 was mUSD 90.1. This includes positive result from investment in associates of mUSD 4.2. Result from Venture Drilling in the fourth quarter was mUSD 8.0 after tax. The net result also includes net financial items of mUSD 80.5 mainly related to bond loans nominated in NOK as the USD has appreciated against NOK during the fourth quarter from 5.83 to 7.00. The fourth quarter 2007 net, after-tax result was mUSD -10.1.
Enclosure : Preliminary result as per 4th quarter 2008.
For further information please contact : Mr. Lars Moldestad, phone +47 906 99 197.
Bergen/Oslo, 19 February 2009
Board of Directors of Petrolia Drilling ASA