EnQuest rebounds with massive profits powered by commodities boom
North Sea operator EnQuest has raked in chunky pre-tax profits of $416m (£359m), fuelled by soaring oil and gas prices and robust production.
It is the latest oil and gas firm to rebound from reduced demand and downgraded profits during the pandemic, with the industry revelling in record earnings.
The London-listed firm has reported hefty revenues of $943m for the six months of trading – nearly double 2021’s half year total of $518m.
Group net production averaged 49,726 barrels of oil equivalent per day (boepd), up from 46,187 boepd in 2021.
The company also managed to ease its net debt, cutting it by $342m from year to $880m, reflecting its strong free cash flow.
EnQuest has confirmed its commitment to investment in the UK, and is reviewing future projects that could benefit from the investment relief included in the Energy Profits Levy.
It expects to pay taxes in the UK in line with the further 25 per cent levy on profits.
The company revealed if the windfall tax had been in place during the first half of 2022, it would have paid $5.6m as a cash tax liability for the period from May 26 to June 30 – the period of time after the announcement.
Group chief executive Amjad Bseisu said: “We have a significant work programme to deliver in the second half of the year but remain on track to deliver our operational targets in our core business. We are also committed to supporting the UK’s twin objectives of delivering energy security and decarbonisation.
Through its infrastructure and new energy business Enquest intends to repurpose existing assets for decarbonisation opportunities.
This includes carbon capture and storage, electrification, and the production of green hydrogen.
EnQuest is also working with partners to progress two North Sea projects.
It has started field development studies for Bressay, which the company acquired a 40.81 per cent operating stake in from Equinor last year.
The team working on the Bentley project are “focused on re-evaluation of the existing subsurface data.”