WASHINGTON: Emirates National Oil Company (Enoc), the Dubai state-owned energy firm, expects annual revenue to fall again this year, weighed down by a lower average oil price. Revenue fell around $6 billion (Dh22 billion) to $15 billion in 2015 when the average price for Brent crude was around $52.40 a barrel.
In 2014, company revenue was close to $21 billion when the average price for Brent was $99 barrel. Petri Pentti, Enoc chief financial officer, said on Tuesday that with the outlook for the average oil price lower than it was last year, it is likely revenue will fall this year. Oil prices are expected to average between $35 a barrel and $40 a barrel this year.
But even with the average oil price halving and a 28.6 per cent drop in revenues, 2015 “was an excellent year for Enoc — profitability wise,” Pentti told reports at an oil conference in Dubai. A good performance in the company’s downstream business boosted profitability, he said.
Sales in petroleum and crude products rose 16 per cent to 220 million barrels in 2015. Crude accounted for 26 per cent of the 220 million barrels and jet fuel account for 16 per cent, according a presentation slide shown by Pentti at the conference.
Enoc is likely to start construction on the expansion of its 140,000 barrel-a-day capacity Jebel Ali refinery by the end of the year, Pentti said, with construction to be completed in 2019. The refinery will be incrementally expanded by 70,000 barrels a day to 210,000 barrels and be fully operational by 2020. The low oil price has meant that Enoc can no longer rely on Gulf banks that had ample liquidity when oil prices were above $100 a barrel.
Pentti said export credit agencies could be tapped for the refinery expansion and that Enoc is also looking at a sukuk and debt markets for general corporate purposes. It is also likely to rely on a record amount of its own cash to fund the expansion, he said. Pentti did not say how much the company is looking to raise. In 2015, it secured a $1.5 billion facility.
