Harbour Energy today announces its unaudited half-year results for the six months ended 30 June 2023.

Operational highlights

• Production of 196 kboepd (H1 2022: 211 kboepd), in line with guidance and split equally between liquids and natural gas
• Unit operating costs of $15/boe (H1 2022: $14/boe)
• Strong safety record: TRIR of 0.8 per million hours worked (H1 2022: 0.7)
• Portfolio diversification progressed:
  • Zama (Mexico) unit development plan approved by the regulator
  • Kan-1 oil discovery (Mexico); appraisal planning underway
  • Following the Timpan-1 discovery in 2022, a multi-well Andaman Sea (Indonesia) exploration campaign to commence in October
  • Viking and Acorn CO2 capture and storage (CCS) projects awarded Track 2 status by the UK government, an important milestone towards potential final investment decisions

Financial highlights1

• EBITDAX of $1.4 billion (H1 2022: $2.0 billion)
• Profit before tax of $0.4 billion (H1 2022: $1.5 billion); loss after tax of $8 million (H1 2022: profit of $1.0 billion) driven by a higher UK tax rate and one-off tax charges
• Free cash flow (post-tax, pre-distributions) of $1.0 billion (H1 2022: $1.4 billion)
• Zero net debt at period end, reduced from $0.8 billion at year-end 2022 and $2.9 billion at completion of the Premier Oil merger in April 2021
• Total announced shareholder returns of c.$1 billion since December 2021, including:
• $200 million share buyback announced in March of which c.$160 million completed
• $100 million (12 cents per share) interim dividend declared, in line with $200 million annual dividend policy and representing nine per cent dividend per share growth year-on-year

2023 Guidance

• Production guidance narrowed to 185-195 kboepd (185-200 kboepd previously)
• Opex of c.$16/boe reiterated, reflecting strong cost control offset by stronger sterling
• Total capex reduced from $1.1 billion to $1.0 billion due to deferral and phasing of capex
• Forecast free cash flow (post-tax, pre-distributions) unchanged at c.$1.0 billion with lower commodity prices, especially UK natural gas prices, offset by reduced capex and positive working capital movements
• Forecast year-end net debt of c.$0.2 billion, due to phasing of capex and timing of tax payments; forecast to be net debt free in H1 20244

Linda Z Cook, Chief Executive Officer, commented:
“We remain focused on maximising the value of our UK oil and gas portfolio, advancing our organic development projects and disciplined capital allocation. This has allowed us to continue to generate significant free cash flow supporting material shareholder distributions while maintaining capacity for meaningful but disciplined M&A. We have also progressed our strategic investment opportunities outside of UK oil and gas – in Indonesia, in Mexico and in CCS. These have the potential to materially increase our reserve life, support shareholder returns and diversify our company over time.”

KeyFacts Energy: Harbour Energy UK country profile