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Swedish producer Lundin Petroleum has said it will be hit with a $204million non-cash foreign exchange loss in its first quarter results.
The company has also booked a $45million pre-tax exploration cost.
Lundin said whilst neither booking would have an impact on its operating cost or its core earnings, they would have an affect on the company’s profitability.
The Zulu well, a small discovery made earlier this year, has also been deemed uncommercial by the company.
The foreign exchange loss was related primarily to the revaluation of Lundin’s loan balances after the US dollar strengthened.
Chief financial officer Mike Nicholson said:”We must recognise that a strong US Dollar is positive for the company.The majority of our revenues are earned in US Dollars, and the value of the assets of the company is predominantly US Dollar driven.”
Earlier this week Lundin Petroleum confirmed the appointment of Nick Walker as senior vice president of development and operations.
He joins the company from Africa Oil Corporation where he has been chief operating officer since 2012.