Aberdeen company First Oil, owned by multimillionaire businessman Ian Suttie, now says it is the largest private UK firm producing oil and gas from the North Sea.
Its report and accounts for the year to April 30 show that fixed assets rose to a record £110million in 2008 compared with £88million in 2007 as it continued to invest in the North Sea.
The company said its programme of capital investment would grow again this year and next with more than £70million being re- invested across all stages of the exploration and production cycle.
It also said its considerable asset base, with interests in 12 producing fields in the North Sea, should result in production hitting 10,000 barrels of oil equivalent (boe) per day next year. It added that at April 30 it had 26.05million boe in proven and probable reserves.
Chairman Mr Suttie said that after taking the First Oil Group to its current levels of activity and financial success the company intended to drill its first two exploration wells as operator.
He added: “This will be an exciting but natural progression, building on our experience gained in the North Sea over more than eight years.
“With substantial cash flows forecast from existing producing fields and significant developments progressing we continue to be encouraged by the organic growth being generated from our existing portfolio.
“Production even at oil prices in today’s terms of £50 per barrel will result in revenues of £500,000 a day and will add the need to find additional investment opportunities, and with the current high levels of investment focus in the industry the marketplace for new assets will continue to be highly competitive. However, First Oil’s unique position as a private company producing material oil and gas in the UK positions us extremely well for the challenge.
“This is especially true as the industry observes it is not immune from the significant effects of the credit crunch combined with the reduced opportunity for repeat fundraising on the markets. First Oil is ideally placed, with our experienced technical team and proven commercial skill, robust financing and enviable asset base to continue the delivery of growth and value creation for the future.”
The accounts show that First Oil achieved pre-tax profits of £5million for the year, compared with £3.86million the year before, on flat revenue of £27.3million. Operating profits rose by 40% to £11million.
Also shown in the accounts is that the unnamed best-paid director received emoluments of £150,000 plus pension contributions of £8,000, up from £100,000 and £5,000 respectively in 2006-07.
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