London-listed Kazakh oil and gas producer KazMunaiGas Exploration Production (RDGZ.KZ) said Monday that its net income rose 28% to 157 billion tenge ($1.28 billion) last year on higher crude oil prices and increased production.
KMG EP said in a statement that the net income rise was "attributable to higher prices received for crude, a favorable movement in the export to domestic sales mix, inclusion of Kazgermunai results, increased financial income."
However, net income for the fourth quarter was KZT53.64 billion, down KZT1.1 billion from the same period in 2006. The decline in net profit for the fourth quarter was due to income tax of KZT48.9 billion. In the fourth quarter of 2006, the company gained KZT10.2 billion from income tax reversal.
The company's revenue increased 18% to KZT487 billion while operating expenses totaled KZT211 billion, KZT17.4 billion higher than in 2006, KMG EP said.
KMG EP's average daily production in 2007 was about 216,900 barrels of oil per day, up 11.6% from 2006. The company said that the increase of production was "primarily due to the acquisition of a 50% stake" in Kazgermunai completed in April last year. The Kazakh oil producer said it had received $300 million and a further $75 million in dividends from Kazgermunai, in November 2007 and March 2008, respectively.
In December, KMG EP completed the acquisition of a 50% stake in a company developing Karazhanbas filed in western Kazakhstan that produced 35,540 barrels a day last year.
KMG EP's majority shareholder is state oil and gas company Kazmunaigas, which owns around 60% of KMG EP.