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Cadogan Petroleum confirms production growth in 2019 but slips to a loss for the year

Published: 03:29 04 May 2020 EDT

Cadogan Petroleum Plc - Cadogan Petroleum confirms production growth but slips to a loss for 2019

Cadogan Petroleum Plc (LON:CAD) has confirmed a 15% increase in year-on-year production during 2019, although losses in its gas trading and services divisions impacted profit for the year.

In its annual financial report, the Ukraine-based producer said some 104,816 barrels oil equivalent flowed in 2019, up from 91,085 barrels the year before.

Cadogan generated US$5.9mln of gross revenue, down from US$14.7mln in the comparative period of 2018. Average realised prices dropped to US$47.2 per barrel oil equivalent, versus US$51.3 in 2018.

READ: Cadogan says 2019 production rose by 15%

The company reported a US$2.1mln loss for the year, including a US$2mln gas trading loss (2018: US$700,000 profit), a US$100,000 loss in services (2018: US$60,000 profit) and US$5.7mln of G&A costs (2018: US$4.8mln).

Cadogan ended December 2019 with US$12.8mln of cash.

Commenting on Cadogan’s outlook for 2020, chief executive Fady Khallouf said: “With the pandemic coronavirus COVID-19 and its negative effects that are spreading globally, Ukraine, as with other countries, is facing a severe impact on its economy as well as to the oil & gas market. In this context, 2020 will be a very difficult year for our business.

“The company intends to adapt its strategy to the situation and to face the very challenging market environment. Prices for oil and gas have been shrinking with an incredible speed. The company, as with many of its peers, is not able to give any outlook on its performance for 2020.”

Khallouf added that the company will stick to strict cost discipline. It will seek to recover cash from previously impaired assets, and it aims to streamline a complex corporate architecture.

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