Lundin Petroleum (OMX: LUPE) held its capital markets day on Thursday. The company called 2011 a transformational year during which it became a new giant in Norway. Production grew to 33,200 boepd (Barrels of Oil Equivalent Per Day) and total reserves plus contingent resources now stand at over 1 million barrels of recoverable oil. Contingent resources in Norway represent the largest portion of this at nearly 700 MMboe.
The company said its 2011 EBITDA has topped 1 billion U.S. Dollars. Cash margin netback in 2011 with an average Brent oil price of 111.25 USD was 88.55 USD/boe. The forecast for 2012 is somewhat lower with estimates given with Brent oil price of 95 and 115 USD per barrel at 68.8 USD/boe and 83.4/USD/boe respectively. Profit after tax estimated under the same scenarios stands at 13.9 and 18.3 USD/boe. For 2012 the company is guiding 32,000-38,000 boepd production.
Exploration activity will remain high in Norway (on both North Sea and Barents Sea) and in South East Asia. In South East Asia the company is active in Malaysia and Indonesia. In Indonesia Lundin has a 25+% non-operated stake in Singa gas field. The Singa license expires in 2017 and discussions to extend it are ongoing. In addition to that the company has six exploration licenses with commercial drilling planned for 2013. In Malaysia Lundin has acquired several prospective exploration licenses offshore Sabah and Peninsular with five exploration drills planned for 2012 on top of two gas- and one oil discovery in 2011.
The company is predicting it will double its production by 2015. Lundin notes that the oil price may surprise to the upside in 2012. Thorough presentation handout material is available for download from the company website at www.lundin-petroleum.com. The stock gained about 1% today but is down close to 10% for the year in the aftermath of the Avaldsnes appraisal well dud from couple weeks ago.
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