Revenues at Corrib Gas operator Vermilion's 'high margin’ Irish business last year dipped by 6.7% to €205.1m.
That is according to the 2023 annual report for the Canadian headquartered Vermilion Energy which confirms that production at Corrib Gas was hit in the third quarter of last year due to planned maintenance downtime.
The revenues of C$302.4m for 2023 compare to revenues of C$324.34m for 2022 - a drop of C$21.94m.
However, 2023 revenues of C$302.4m remained 41% ahead of 2021 revenues of C$214.4m.
With the outbreak of the Ukraine war in February 2022, Vermilion has benefited like other energy producers with the sharp increase in gas prices with the annual report referring to "premium priced European gas".
The price of gas did decline last year and this contributed to global revenues at Vermilion declining by 42% from Can$3.476bn to Can$2.2bn.
The Corrib gas field contributes up to 29% of Ireland’s natural gas consumption and 100% of the country’s gas production.
The Corrib field is located approximately 83 kilometres off the coast of County Mayo, in 350 metres of water. The distance from the seabed to the Corrib reservoir is a further 3,000 metres.
The annual report shows that operating expenses at the firm’s Irish unit more than doubled from C$16.58 million in 2022 to C$39.46 million last year.
Transportation costs at the Corrib Gas project for Vermilion nearly doubled from C$3.57m to C$7.09m.
At the end of March last year, Vermilion became the country’s largest provider of domestic natural gas here with it acquired Equinor’s 36.5% interest in Corrib Gas giving it an operating interest of 56.5%.
The report states that the new assets acquired contributed revenues net of royalties last year of C$161.7m and net earnings of $43.6m.
The report confirms that Vermilion paid out C$488.89m in cash for the 36.5% share of the business.
The C$488.89m in cash is calculated by a value of net assets acquired C$928.38m less a C$439.48m "gain on business combination".
The gain on business combination when the purchase agreement was entered into in November 2021 and when the acquisition closed in March 2023 occurred "due to significant increases in European natural gas prices throughout 2022 and Q1 2023".
- report Gordon Deegan
