Harbour Energy reports 2023 results

LONDON: Harbour Energy plc, an independent oil and gas company, today announced its results for the year ended 31 December 2023 and provided an update on its outlook and acquisition plans.

Harbour financial highlights

  • Realised, post hedging oil and UK gas prices of $78/bbl and 54p/therm (2022: $78/bbl and 86p/therm)
  • Revenue of $3.7 billion (2022: $5.4 billion), reflecting lower natural gas prices and production
  • Profit before tax of $0.6 billion (2022: $2.5 billion); profit after tax of $32 million (2022: $8 million) reflecting an effective tax rate of 95% (2022: 100%)
  • Free cash flow (post-tax, pre-distributions) of $1.0 billion (2022: $2.1 billion)

The company reported a production of 186 kboepd, within guidance, and operating costs of $16/boe, in line with guidance, for 2023. It also increased its total 2P reserves and 2C resources to 880 mmboe, reflecting reserve additions and exploration success. The company reduced its net debt to $0.2 billion and returned $449 million to shareholders through dividends and share buybacks.

Harbour also announced the acquisition of substantially all of Wintershall Dea’s upstream assets for $11.2 billion, which will transform Harbour into one of the world’s largest and most geographically diverse independent oil and gas companies. The acquisition is expected to complete in Q4 2024, subject to shareholder and regulatory approvals.

Harbour reiterated its production guidance of 150-165 kboepd and its capital expenditure guidance of $1.2 billion for 2024. It expects to generate marginally positive free cash flow in 2024 and significant free cash flow in 2025, resulting in a net cash position by the end of 2025. The company has hedged a portion of its UK gas and liquids volumes for 2024 and 2025 to protect its cash flow from price volatility.

Linda Z Cook, Chief Executive Officer, commented: “Harbour materially advanced its strategy during 2023. We improved our safety performance, generated material free cash flow, and progressed our international growth opportunities and CCS projects, while maintaining our capital discipline. This enabled continued shareholder returns over and above our base dividend while retaining the flexibility that allowed us to announce a transformational acquisition in December.

“We remain focused on the successful completion of the Wintershall Dea acquisition and the ongoing safe and efficient management of our existing portfolio. We are excited about our future as we look to continue to build a geographically diverse, large scale, independent oil and gas company focused on safe and responsible operations, value creation and shareholder returns.”

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