By Alex MacDonald
LONDON--Circle Oil PLC (COP.LN) said Monday it swung to a net
loss last year due to exploration writeoffs and a significantly
lower oil price, which prompted the company to review its cost base
and consider selling stakes in assets to fund operations.
The U.K.-listed oil and gas explorer, which has interests in
Morocco, Tunisia, and Egypt, reported a net loss of $54 million for
the year ending Dec 31, 2014 compared with a net profit of $29
million in the same period a year earlier. This reflected a 9% drop
in revenue to $85 million largely due to lower oil prices and
exploration write offs of $57 million largely focused in Oman and
Tunsia. It also recorded a $14 million impairment charge on its NW
Gemsa permit in Egypt.
In Morocco, gross gas production was 6.46 million cubic feet per
day, broadly similar to last year, although gross oil production
declined to 10,026 barrels of oil per day from 10,443 barrels of
oil per day due to the maturing NW Gemsa fields in Egypt.
"Cost overruns on both the Mahdia Block and on Block 49 in Oman,
have resulted in Circle undertaking a thorough review of its cost
base and capital expenditure commitments," Chairman Stephen Jenkins
said.
The company will continue to grow its portfolio of assets this
year and has plans to drill three new wells in Egypt in order to
maintain production, Mr. Jenkins said. It also plans to drill at
least another three wells in Morocco this year.
The company had net debt of $59 million at the end of May, up
from $38.69 million at the end of the year.
Circle's shares are up 10% since the beginning of the year at
13.25 pence a share, resulting in a market capitalization of 75
million pounds ($114 million).
Write to Alex MacDonald at alex.macdonald@wsj.com