Independent oil explorer Premier Oil reported a 64 percent rise in first half net profits on Thursday, as higher oil and gas prices more than made up for a fall in production.
London-based Premier said in a statement that its first half net profit rose to $33.7 million (17.8 million pounds), thanks to a 75 percent rise in the price it received for its oil and a 56 percent rise in gas prices.
The net profit result was short of a Deutsche Bank forecast of $38 million (20 million pounds).
Premier's oil and gas production was 33,521 barrels of oil equivalent per day (boepd) in the first half, down 3.6 percent compared to the same period last year and just shy of a Deutsche Bank forecast of 33,600 boepd.
Chief Executive Simon Lockett told Reuters in an interview that lower than expected output from the company's new fields in Mauritania had failed to compensate for the natural decline of Premier's North Sea fields.
Nonetheless, Premier repeated its medium term production target of 50,000 boepd and its 2011 target of 60,000 boepd.
Lockett said he was reasonably confident that the company and its partners would decide to proceed with development of the Tiof field offshore Mauritania.
Analysts said it was unclear whether the project will be commercial. Lockett said development depended on devising the right strategy. A final decision is due in early 2007.
The company added its shift in exploration strategy to focus on drilling wells with greater potential upside but which are also riskier was paying dividends, with five out of seven wells encountering success.
Lockett said he planned to continue this programme.
We're heading right now to what could be a very exciting period for us in our exploration strategy, he said.