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Cairn Energy’s share price falls on full-year results, asset sales and acquisition news

first_imgCairn Energy’s share price falls on full-year results, asset sales and acquisition news Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! .The Cairn Energy (LSE: CNE) share price has fallen in Tuesday trade so far following a string of market updates. The UK oil share has since pared gains but, at 192p per share, it remains 3% down from Monday’s close.Cairn Energy announced today that revenues slumped 26% year-on-year in 2020 to $324.5m. This was due to the collapse in oil prices which accompanied the Covid-19 outbreak and the subsequent economic downturn. Cairn realised an average price of $42.56 a barrel last year versus the $65.70 it achieved back in 2019.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Meanwhile, production costs rose 12% between 2020 and the previous year to $75.9m. This added to Cairn Energy’s woes and, as a consequence, the company swung to a pre-tax loss of $117.5m. This compares with the profit of $119.2m the oilie reported back in 2019.Production drops tooOn the production front, Cairn Energy said that its net average was 21,350 barrels of oil equivalent per day in 2020. This was in line with guidance, but down from the 23,739 barrels which it reported in 2019.The fossil fuel giant said production at its Kraken asset in the North Sea “remained strong throughout the year.” Production here averaged around 37,500 barrels of oil equivalent a day, up from approximately 35,600 barrels in 2019. But output at its offshore Catcher field was less impressive. Operational problems in the fourth quarter meant production here averaged around 51,200 barrels per day in 2020. This was down from around 67,200 a day the previous year.Big changes at Cairn EnergyTuesday’s been a busy day over at Cairn Energy. On top of those full-year results, the oil company announced big changes to its asset portfolio.First off, Cairn announced its intention to sell its interests in Kraken and Catcher to Waldorf Production Limited for $460m. An additional contingent will be payable depending upon oil prices between now and 2025 too.Cairn Energy said that “the divestment of these assets, as they fall into natural decline, will further strengthen our ability to pursue Cairn’s strategic goals.”The company also announced it plans to acquire “a portfolio of upstream oil and gas production, development and exploration interests” from Royal Dutch Shell with fellow fossil fuel explorer Cheiron.The assets — which are located in Egypt’s Western Desert region — will initially cost a combined $646m. An additional $280m will be payable on certain requirements being met. Cairn and Cheiron will be liable for a 50/50 split on these amounts.Cairn Energy said that the portfolio “offers low cost production, near-term development and exploration potential, provides immediate operating cashflow contribution and adjusts our overall hydrocarbon split towards gas.”The company estimates that the assets will add between 33,000 and 38,000 barrels of oil equivalent a day to group production in 2021. Approximately two-thirds of this total is comprised of natural gas. Our 6 ‘Best Buys Now’ Shares “This Stock Could Be Like Buying Amazon in 1997” Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Simply click below to discover how you can take advantage of this.center_img I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. 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