Return to profit for Paladin

By THIS IS MONEY
Updated: 18:00 EST, 27 March 2000

Oil and gas exploration and production minnow Paladin Resources reported a return to profit on the back of stronger oil prices and a 49% jump in production.

'While current oil prices are obviously having a very beneficial effect on near-term cash flows, we continue to plan on a long-term Brent oil price in the mid-teens in reviewing investment opportunities and acquisitions,' chairman Malcolm Gourlay said in the results statement.

Paladin, with interests in the North Sea, the United States and Indonesia, made a 1999 pre-tax profit of £3.4m, compared with a loss of £1.2m the year before, on turnover of £18.6m.

Output climbed to an average 5,487 barrels of oil equivalent per day in 1999, from 3,683 the year before, while reserves grew by 79% to 38.1 million barrels of oil equivalent, partly reflecting last October's $36 million Warrior Oil Co purchase.

Paladin's shares were unchanged at 27 pence at 09.30am. The group's strategy was to grow through acquisition and exploration. Gourlay said that while asset rationalisation was expected to continue the challenge would be in financing deals 'against a backdrop of difficult equity and debt markets for exploration and productions companies'. ©Reuters