Dragon Oil (LON:DGO) said this morning it continues its search for oil and gas assets outside Turkmenistan, the hugely cash-generative cornerstone of the business.
As part of this geographic diversification the group has acquired positions in Iraq and Tunisia and is in the mix for exploration acreage in Afghanistan.
The aim is to build on the success it has enjoyed in the Cheleken Contract Area the eastern Caspian Sea.
In the last six months the operation generated US$404.2 million in operating profit (unchanged on this time last year) and cash of almost US$484 million, which means Dragon has US$1.66 billion on deposit.
The group hit a new production high of 70,017 barrels of oil per dayon August 11, while the average for the period was 64,200 barrels, up 10.7 per cent on the same time last year.
This increase achieved in spite of the need to control the sand flow from certain wells.
It aims to maintain a target of growing production growth at 10 to 15 per cent a year with output increasing to 100,000 barrels a day in that time.
Investors will be rewarded with a 15 cents a share interim dividend, while in June the group said it would spend US$200 million buying back its own stock.
Chief executive Dr Abdul Jaleel Al Khalifa said: "I am pleased to report strong financial results for the first half of this year despite oil price volatility during the period and the temporary impact on gross production from controlling sand flow from certain wells.
"Progress has been made with our diversification strategy. Dragon Oil, in a consortium of companies, has been awarded Block Nine for exploration and development in Iraq and the initialling of the service contract has already taken place.
“In Tunisia, our partner in the Bargou Exploration Permit, Cooper Energy Limited has secured a rig to commence drilling of the Hammamet West-3 well in the Hammamet West Oil Field at the end of this year or early next year.
“We continue our search for oil and gas assets in the regions of interest to us and to this end Dragon Oil has been pre-qualified for bidding for blocks in Afghanistan later this year.
"Board and senior management have been strengthened by appointments at the beginning of this year adding to the Group's expertise and further enhancing the people-driven culture within the organisation.”