Emirati energy and utilities giant Taqa reported bumper profits for 2023 from its new stake in Adnoc Gas, but decline from North Sea assets prompted a 7% slide in production.
Pre-tax profits at the Abu Dhabi National Energy Company (ADX: TAQA) hit 19.4bn dirhams (£4.2bn) last year, more than double the 8.3bn dirhams (£1.8bn) seen in 2022.
The jump in net income was mainly driven by a one-off gain of 10.8 billion dirhams (£2.3bn) following the group’s acquisition of a 5% shareholding in ADNOC Gas a year ago.
Group revenues increased marginally on last year to 51.7 billion dirhams (£11.2bn), while adjusted EBITDA fell 6% to 19.6 billion (£4.2bn), due to lower contributions from its oil and gas business on lower commodity prices and reduced production.
Average oil and gas average production fell 7% to 107,000 barrels of oil equivalent per day (boepd), “mainly due to the natural decline in production of late-life UK assets”, Taqa said.
The group entered the UK North Sea in 2007 and has seven platforms in the region, four of which are expected to move to cessation of production (CoP) this year.
The final three, in the Central North Sea, will also be shuttered by the end of 2027 followed by down-manning and full decommissioning, Taqa’s UK boss confirmed last year.
Tripled target
Looking ahead, Taqa pointed to upgraded 2030 targets that reflect “stronger growth ambitions”, notably the tripling of its power target to 150 GW by 2030, of which 100 GW will come from renewable capacity through the recently acquired investment group Masdar.
Renewable energy is expected to constitute over 65% of the company’s generation mix by 2030 compared with 45% as at the end of 2023.
To achieve this the group plans a capital spend of 75 billion dirhams (£16.3bn), of which 40 billion is earmarked for UAE-based transmission and distribution networks, and 35 billion for generation. Over half of the latter tranche (55%) would be committed via Masdar.
Chairman Mohamed Hassan Alsuwaidi commented: “TAQA’s strategic positioning across its markets, particularly in Abu Dhabi as a fully integrated local utilities champion, remains key to our robust results.
“The significant upward revision of our production targets is testament to our confidence in being able to deliver on our ambitions and strategic goals for 2030 and beyond.”
Group CEO and managing director Jasim Husain Thabet added: “In 2023, TAQA remained unwavering in its commitment to creating long-term shareholder value, navigating a challenging global economic backdrop, mitigating challenges in the oil and gas market with a robust performance across our utilities business, including in transmission and distribution and generation.”
Mr Thabet also pointed to progress achieved during the year on projects including the Mirfa 2 Reverse Osmosis water plant with Engie, and an investment into Xlinks First – a developer with plans to lay a high-voltage direct current (HVDC) link between Morocco and the UK, transporting up to 3.6GW of power.
TAQA’s board also proposed a final cash dividend of 2 fils/share (2.2 billion dirhams), including variable dividend of 0.7 fils/share, or 800m dirhams.
The payout would bring total dividends for the year to 3.95 fils/share, or 4.4 billion dirhams.
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