DNO ASA, the Norwegian oil and gas operator, today reported 2023 revenues of USD 668 million and operating profit of USD 218 million on the back of production rebound in the Kurdistan region of Iraq in a year marked by North Sea exploration success.

Net production averaged 52,600 barrels of oil equivalent per day (boepd), of which Kurdistan contributed 34,900 boepd, North Sea 14,200 boepd and West Africa 3,500 boepd. The pivot towards North Sea, accelerated in 2019, delivered a string of discoveries with combined recoverable volumes estimated at 100 million barrels of oil equivalent net to the Company last year.

At yearend, gross production from the DNO-operated Tawke license had largely recovered from the March 2023 export pipeline shutdown and was averaging 80,000 boepd. The Company’s net entitlement share is sold at reduced prices in the low-to-mid USD 30s per barrel on a cash and carry basis and transported by traders by road tanker or pipelined to local refineries.

With operational spend down 65 percent, Tawke sales now generate some USD 10 million per month of free cash flows to DNO, notwithstanding lower realized prices.

“Surely no one is pleased to leave significant money on the table with every barrel sold,” said DNO’s Executive Chairman Bijan Mossavar-Rahmani. “But the Company remains resilient in its second semi-centennium and will take this new challenge head on,” he said.

Net production in the North Sea this year is projected at 15,000-16,000 boepd; the bolt-on acquisition of a 25 percent stake in the producing UK field Arran will add another 2,000-2,500 boepd once completed.

In Kurdistan, DNO expects gross operated production at the Tawke license to continue to average 80,000 boepd. That figure could change depending on the outcome of ongoing discussions related to recovery of arrears for past deliveries to the Kurdistan Regional Government and payment terms and conditions for any future oil exports, which in turn will drive investments in wells.

Total operational spend is projected at USD 645 million, up 15 percent from last year, primarily reflecting higher development activity in Norway on the back of previous discoveries.

The balance sheet remains strong and the Board of Directors yesterday authorized a dividend of NOK 0.25 per share in February, maintaining quarterly distributions.

Key figures

KeyFacts Energy: DNO Norway country profile