Britain’s Premier Oil cut debt to $2.3 billion at the end of 2018, below a previous forecast of $2.4 billion, it said in a trading update on Jan. 10.
Premier’s full-year production of 80,500 barrels of oil equivalent per day (boe/d) came in slightly above its guidance and was up 7% from its 2017 output.
For this year, Premier, which has been selling producing assets, sees output at around 75,000 boe/d.
Premier estimates its revenue for last year at $1.4 billion, more than a quarter higher than in 2017 on the back of higher production as well as higher prices.
Premier has been hedging large chunks of its production, including around 36% at an average of $70 a barrel (bbl) through the year. Oil prices are currently around $60/bbl.
“On a full year basis, Premier expects to generate positive free cash flow at oil prices above $45 [a barrel] during 2019,” Premier said.
It sees operating costs to rise to around $20/bbl from $16.90 in 2018, reflecting the sale of low-cost gas producing fields.
Premier, whose bottom line still profits from tax loss allowances, is set to spend around $290 million on development and exploration, including its wells in Mexico’s Zama field.