Petrolifera 2007 revenue increases 27% to US$134mn, profits fall - RegionalTuesday, March 18, 2008
Calgary-based Petrolifera Petroleum (TSX: PDP), which operates in South America, made 2007 revenue of Cdn$134mn (US$134mn), up 27% from Cdn$106mn the year before, the company said in a statement.
Net profits for the year fell 21% from Cdn$37.3mn in 2006 to Cdn$29.3mn in 2007.
Revenue growth in 2007 was constrained by the strength of the Canadian dollar relative to the US dollar and the Argentine peso, according to the statement.
"As in 2006, all our growth in 2007 was organic," Petrolifera CEO Richard Gusella said in a conference call with investors. "We accomplished all this with no rigs available in early 2007 and delays in the arrival of contracted rigs."
Energy shortages also affected Argentina throughout the year, he said.
Sales in 2007 increased 34% to 8,279boe/d from 6,171boe/d in 2006.
Production is currently pushing 10,000boe/d because of drilling successes in early 2008, Gusella said, adding output stands at 8,700b/d of oil and 1,000boe/d of natural gas.
Production is expected to rise when the impact of a completed waterflood project is seen in mid-2008.
In 2007, Petrolifera completed 33 new crude oil, two natural gas and three water injector wells in Argentina. The company secured three new concessions in Argentina and three in Colombia during the year, bringing Petrolifera's total land position to 7M undeveloped acres (28,330km2) in Argentina, Colombia and Peru.
Proved 1P reserves increased 28% to 17.8Mboe in 2007 from 12.9Mboe in 2006. Proved, probable and possible 3P reserves were 39Mboe.
The company invested Cdn$111mn in 2007, Cdn$98mn of that in Argentina. The remaining Cdn$12mn went to Peru and Colombia.
Petrolifera plans to invest US$76mn in Argentina in 2008 and has budgeted Cdn$56mn for Peru.
ARGENTINE TAXES
The Argentine export tax hike, which had the effect of capping prices at US$42/b in November 2007, had an adverse impact on investor attitude towards the Argentine oil industry, according to the statement.
"It's a questionable policy as it can only mean shortages and a loss of self-reliance for Argentina in the future," Gusella said.
The company received an average of Cdn$45.51/b for crude in 2007, a 5% drop from Cdn$47.71/b in 2006.
By comparison, WTI averaged US$72.31/b in 2007 and late in the year surpassed US$100/b, while averaging more than US$90/b in 4Q07, according to the statement.
Argentina could be planning to increase the price cap on oil soon, Gusella said.
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