Det Norske Oljeselskap ASA, the oil company controlled by Norwegian billionaire Kjell Inge Roekke, deepened losses in the third quarter after booking an impairment due to lower crude-price assumptions.
The net loss was $166 million, compared with a $17 million loss a year earlier, the Trondheim-based company said in a statement Wednesday. The loss was due to a non-cash impairment charge of $186 million related to decreasing forward prices for oil, it said.
The company said it expects production costs to average about $6.5 a barrel this year, down from a $8 to $10 range earlier, as it realized cost savings of more than $100 million so far this year. The company produced 62,800 barrels of oil equivalent a day in the third quarter and expects output to average about 62,000 barrels a day in 2015, compared with a previous forecast of 58,000 barrels to 63,000 barrels a day, it said.
Det Norske is one of the owners of Norway’s biggest offshore project in decades, the Johan Sverdrup field, which could hold as much as 3 billion barrels of oil. The company has filed a complaint to the government on the share it has been allocated in the field following a dispute with the other owners, and is still awaiting the outcome, it said.
“With available liquidity of about $1.7 billion, the company has a robust financing in place and has secured funding for its work program until first oil at Johan Sverdrup”, Chief Executive Officer Karl Johnny Hersvik said in the statement.
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