Harbour Energy’s Share Price Rallied 5.15% on a 9-Month Update

The Harbour Energy PLC (LON: HBR) share price had rallied  5.15% as of 8:49 GMT after issuing its unaudited Trading and Operations Update for the nine months to 30 September 2023. The company reported producing an average of 189 kboepd, a decline from 2022’s 207 kboepd. 

The company’s production was split equally between liquids (50%) and gas at 50%. The oil and gas company reiterated its full-year guidance of 185-195 kboepd. The firm’s operating costs averaged $16/boe, slightly declining from 2022’s $14/boe for the same period. The company maintained its full-year guidance of $16/boe. 

Furthermore, Harbour Energy indicated that it had pursued short-term, high-return, infrastructure-led investment opportunities in the UK that could support its future production and cash flow. 

The estimated revenue for the reporting period stood at $2.9 billion. This figure considers realised post-hedging oil prices of $77 per barrel and UK gas prices of 53 pence per therm. 

Harbour Energy reiterated its total capital expenditure (capex) guidance for 2023, which remains at approximately $1 billion. This reaffirms its commitment to increased drilling activities later in the year.

The company’s 2023 free cash flow forecast is expected to be around $1 billion. This projection considers anticipated total cash tax payments of $0.4 billion but does not include shareholder distributions.

Year to date, the oil company has completed shareholder distributions totalling about $440 million. This encompasses approximately $240 million allocated to share buybacks and an interim dividend of about $100 million paid in October. 

Linda Z Cook, Harbour Energy’s Chief Executive Officer, commented: “We have continued to maximise the value of our UK oil and gas portfolio and to progress our diversification opportunities in Mexico, Indonesia and CCS while maintaining strong cost control and capital discipline. This has enabled significant free cash flow generation and a robust balance sheet, supporting material shareholder returns over and above our base dividend. We also continue to evaluate a number of material M&A opportunities in line with our stated strategy as we seek to build a global and diverse oil and gas company. Recent large transactions in our sector and our own discussions with potential counterparties indicate that market conditions for M&A are improving.”

Harbour Energy share price. 

The Harbour Energy share price rallied 5.15% to trade at 229.55p from Tuesday’s closing price of 218.30p.