Harbour Energy eyeing M&A opportunities, reiterates full-year guidance

(Sharecast News) - Oil and gas group Harbour Energy has held on to its full-year production and cost guidance as it expressed its interest in "a number of material M&A opportunities".

The stock was up 4.2% at 227.5p in early deals.

Production averaged 189 thousand barrels of oil equivalents per day (kboepd) in the nine months to 30 September, down from 207 kboepd last year, in line with the full-year average target of 185-195 kboepd.

Operating costs during the period averaged $16/boe, up from $14/boe previously, and also in line with full-year guidance of "circa $16/boe", with strong cost control offset by lower volumes.

Estimated revenue over the nine months was $2.9bn, with realised post-hedging oil and UK gas prices of $77 a barrel and 53p per therm, respectively.

The company expects to end the year with free cash flow of $1bn.

"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," said Harbour's chief executive Linda Cook.

"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," Cook said.

"We remain disciplined, balancing the return of excess capital to shareholders with ensuring flexibility for meaningful, value accretive M&A which would support shareholder returns over the longer run."

Earlier in the week, the company was reported to be looking at a potential acquisition of BASF's 73% stake in Wintershall Dea, Germany's largest oil and gas producer, according to reports in Energy Voice citing anonymous sources with knowledge of the matter.