Yemis Izuora
Oando Energy Resources (OER) has said that its net revenue in 2014 has hit $421.4 million.
The figure showed an increase of $294.2 million over $127.2 million earned in 2013, according to report by PR Newswire in London.
The company attributed the performance primarily to the Conoco Philips (COP) upstream asset Acquisition.
OER had hedged 10,223 barrels per day ( bbl/day) of crude oil production between $91/bbl and $97/bbl until July 2017 and January 2019, respectively, with further upside available if certain price targets were met.
The hedges represent approximately 47 percent of the fourth quarter production rates of crude oil.
In February 2015, the hedge price was reset to $65/bbl following the restructuring of the hedge agreement; proceeds of $234 million were realized and used to repay debt.
From July 30 to December 31, 2014, the Acquisition Assets contributed $136.8 million to net income before taxes based on $299.0 million in revenue, $116.5 million of production expenses, and $45.7 million in depreciation, depletion and amortization expense.
The Company also incurred a net loss of $320.0 million during the year, as compared to a net loss of $38.2 million in 2013.
This was mainly due to non-cash asset impairment charges of $462.8 million, as well as approximately $84.9 million in transaction costs associated with the acquisition of the ConocoPhillips Nigerian business.
These amounts were partially offset by the $288.3 million net gain on financial instruments.