For the six months ended 30 June 2014, lower realised net sales impacted OER's revenue by 13.4 million US dollars while increased production contributed 10.2 million US dollars.
“This half year we have witnessed a 20 per cent growth in production against last year, due to optimization processes on our current producing assets”, said Pade Durotoye chief executive officer of OER, a subsidiary of the Nigerian oil and gas company [DATA OAO:Oando Plc].
(WATCH VIDEO: Oando CEO comments on US-Africa summit)
Production from existing assets increased from 687,757 barrels (bbls), an average of 3,800 barrels per day to 821,786 bbls, an average of 4,540 barrels per day due to a 17 per cent production boost at Abo field (OML 125) and a 30 per cent increase at Ebendo field (OML 56).
On the other hand, the group lost 177.5 million US dollars due to developments during the period such as a 106.9 million US dollars fair value loss on financial instruments, 30.7 million US dollars towards financing expenses and 13 million US dollars of unrecognised revenue from production at OML 125.
During the period, the group also acquired the Nigerian business unit of multinational petrochemical company, ConocoPhillips for 1.65 billion US dollars, making it the largest agreement in Nigeria’s capital market to date.
(READ MORE: Oando closes ConocoPhillips deal in Paris)
The deal is expected to boost Oando’s oil production level within the West African country to 50,000 barrels a day.
“As a result of our completion of the acquisition of the ConocoPhillips Nigeria business unit, our immediate outlook will be to integrate the systems, processes and people towards growing the business and creating true value for our shareholders,” added Durotoye.
(WATCH VIDEO: Oando's Growth Strategy with Wale Tinubu)
Oando’s sales production increased from 41,071 barrels of oil equivalent per day (boe/d) in 2013 to 44,512boe/d in the first half of 2014.