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Cairn Energy boasts “balance sheet strength” as it eyes growth opportunities

"Cairn enters 2019 with balance sheet strength and cash flow from North Sea production to fund significant growth opportunities,” said Simon Thomson, Cairn chief executive
oil and gas operations
Cairn pitched its production guidance for 2019 at 19,000 to 22,000 boepd.

Cairn Energy PLC (LON:CNE) boasted “balance sheet strength” as it delivered a trading update which confirmed that production averaged 17,500 barrels oil equivalent per day net from the Catcher and Kraken fields in the North Sea.

The company, in a statement ahead of releasing 2018’s full-year results in March, said that revenue for the twelve months amounted to US$395mln with the average sales price over the year equating to US$68 per barrel.

Cairn ended December with US$66mln of cash.

READ: Tullow Oil eyes growth this year

It also had US$39mln of receivables due from oil sales and US$32mln of Norwegian exploration tax receivables. At year-end, Cairn had drawn US$85mln of a US$575mln Reserves Based Lending facility which has a 2025 maturity.

The oil firm reported capital expenditure of US$335mln in 2018 and said it expects to spend another US$305mln this year.

Cairn pitched its production guidance for 2019 at 19,000 to 22,000 boepd.

"Cairn enters 2019 with balance sheet strength and cash flow from North Sea production to fund significant growth opportunities,” said Simon Thomson, Cairn chief executive.

“The SNE and Nova development projects are progressing on track, evaluation of the recent Agar discovery is ongoing and we look forward to commencing a material exploration drilling programme in 2019 with up to seven wells offshore Mexico, the UK and Norway targeting a total gross volume in excess of one billion barrels.”

In regards to the long-running Cairn India issue, Thomson added: “We expect a final international arbitration decision on our India claim in the near term and we remain confident of our position."

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