Lundin Petroleum: Q3 2015 financial update

Lundin Petroleum AB (Lundin Petroleum) will expense pre-tax exploration costs of approximately MUSD 10 and recognise a net foreign exchange loss of approximately MUSD 201 for the third quarter of 2015.

The profitability for the third quarter of 2015 will be impacted by certain expensed exploration costs as well as a net foreign currency exchange loss, mainly related to the revaluation of loan balances. These items will have no impact on the reported operating cash flow or EBITDA for the period.

Exploration costs

During the third quarter of 2015, Lundin Petroleum will incur pre-tax exploration costs of approximately MUSD 10 which will be charged to the income statement and offset by a tax credit of approximately MUSD 8. The exploration costs mainly relate to an exploration well drilled in Norway during the third quarter of 2015 on the Zeppelin prospect in PL734 which was announced as a dry hole.

Foreign exchange

Lundin Petroleum will recognise a net foreign exchange loss of approximately MUSD 201 in its income statement for the third quarter of 2015. The foreign exchange loss mainly relates to the revaluation of loan balances at the prevailing exchange rates at the end of the reporting period. The Norwegian Krone weakened by 8 percent against the Euro and US Dollar during the third quarter of 2015 resulting in a foreign currency exchange loss on a Norwegian Krone denominated intercompany loan balance with a subsidiary using a functional currency of the Euro and on settled foreign currency hedges.

Read the article online at: https://www.oilfieldtechnology.com/product-news/21102015/lundin-petroleum-q3-2015-financial-update/