For the year ended 31 December 2020
2020 Summary
- The impact of COVID-19 has been managed safely across the business
- India Arbitration Tribunal award in December 2020 of US$1.2bn plus interest and costs
- Completion of sale of interests in Norway and Senegal
- Year-end Group cash US$570m with no drawn debt, US$250m subsequently returned to shareholders by special dividend
- Net oil production averaged just over 21,0001 bopd, in line with guidance (2019: 23,000 bopd)
- Oil and gas sales revenue of US$324m (2019:US$504m): average realised oil price of US$42.56/bbl (before hedging gains of US$7.27/bbl): (average production cost US$20/boe)
- Net cash inflow from oil and gas production US$239m
- Capital expenditure on continuing operations was US$125m, in line with guidance
- Operating loss US$67m (2019: US$155m operating profit)
- Loss after tax of US$394m (2019: profit of US$94m), including loss on disposals of US$276m; no recognition of gain on arbitration award, held as contingent asset
2021 Outlook
- Completion of proposed acquisition of Shell’s Western Desert assets in Egypt for consideration of US$323m2, adding forecast Cairn WI 2021 production of 33,000-38,000 boepd (66% gas)
- Completion of proposed sale of interests in UK Catcher and Kraken fields for a firm consideration of US$460m2 plus contingent consideration linked to oil price and production performance, further strengthening the balance sheet to deliver additional portfolio growth
- Continued engagement with the Government of India regarding the arbitration award of US$1.2bn plus interest and costs, whilst all necessary steps are being taken to ensure access to the value of the award for our shareholders
- Estimated exploration and appraisal capital expenditure (excluding Egypt and Catcher and Kraken) of US$90m, including exploration wells planned in Mexico and the UK North Sea
1 Based on 20% Catcher production and 29.5% of Kraken production before deducting FlowStream’s entitlement to Kraken volumes during the year of 1,012 boepd (2019: 1,460 boepd)
2 Consideration as at effective date of 1 January 2020, to be adjusted for working capital and interim period cashflows