By MARK RAO / Graphic By TMR

Hibiscus Petroleum Bhd, in a bid to ramp up production for higher profitability, is striving to complete drilling works at its Anasuria asset in the North Sea and the North Sabah acquisition by the middle of this year.

The move comes as Hibiscus recorded an improved second quarter ended Dec 31, 2017 (2Q18), with its net profit increasing 3.5% year-on-year (YoY) to RM11.04 million in line with a 21.1% YoY rise in revenue to RM76.06 million.

Its brownfield Anasuria cluster was largely responsible for saving the company RM1.7 million in expenses by virtue of its lower amortisation of assets and unwinding discounts.

The asset registered stronger turnover on the higher average oil price of US$62.93 (RM246.03) per barrel in 2Q18 versus the US$51.54 per barrel registered in 2Q17.

The stronger prices helped as Hibiscus sold lower volumes of oil at 274,644 barrels in the period com- pared to 298,909 barrels sold in 2Q17.

The firm managed to cut losses at its Australian-based assets due to the absence of foreign-exchange losses.

Hibiscus’ net profit for the first half of its 2018 fiscal year saw a 76% slump to RM21.83 million from the RM90.96 million achieved a year earlier, owing to the absence of a tax credit for its Anasuria cluster in the 1Q18, which continued to weigh down on profits.

Revenue remained higher by 14.2% YoY at RM117.57 million.

Going forward, Hibiscus noted it will look to complete the drilling of the Guillemot A GUA-P2 side-track well, targeted to be completed by the middle of this year, to unlock some 1.01 million barrels of oil.

The drilling project is part of a planned production enhancement project for the Anasuria cluster as it

aims to achieve 5,000 barrels a day there by fiscal year ending June 30, 2020. Production was at 2,071 barrels a day at the end of last year.

Hibiscus has allocated £40 million (RM217.71 million) in capital expenditure for its UK asset and is expecting to complete the acquisition of a 50% stake in the 2011 North Sabah Enhanced Oil Recovery Production Sharing Contract by March 31, 2018.

The project, which will provide a second revenue stream independent of the Anasuria cluster, has the potential to triple the group’s oil production output.

The company will also focus on lowering unit production while integrating operations for the project, upon completion of the US$25 million (RM97.74 million) acquisition.

“We hope all these events will act as positive value enhancing triggers for our shareholders,” Hibiscus noted in an exchange filing to Bursa Malaysia yesterday.

“With production at the Anasuria cluster restored to expected levels and oil prices demonstrating favourable trends, barring unforeseen circumstances, we expect these factors to augur well for the group’s performance in this financial year,” the company added.