LONDON (Reuters) - British oil firm Premier Oil (PMO.L) said it planned to make a dividend payment, its first since 1998, after annual profit soared by close to 50 percent on booming production levels.
The company, which produces oil and gas in the North Sea, Indonesia and Vietnam, posted profit after tax of $252 million (166 million pounds) for 2012 compared with the $171 million (113 million pounds) it made the year before and broadly in line with a company-supplied consensus forecast of $255 million (168 million pounds).
Premier’s confidence in its rising cash flows, which were 66 percent higher in 2012 at $808 million (534 million pounds), meant it proposed paying an initial dividend of 5 pence per share. It has not paid out any dividend under current management, not since 1998, due to a period of investment in new projects and exploration.
Payment of the dividend is subject to board approval, Premier said on Thursday.
The company’s profits were helped by a 43 percent jump in production in 2012 to 57,700 barrels of oil equivalent per day (boepd) as new projects came on stream.
Premier also said that it expected to reach milestones on two key projects this year - the final sanction of the big Catcher project in the North Sea, and selecting a development plan for an oil project in the Falkland Islands.
The company last year agreed a $1 billion (661 million pounds) deal with small British explorer Rockhopper (RKH.L) to turn the Falkland Islands into an oil producer, shrugging off concerns about political tension with Argentina which claims sovereignty over the islands.
Premier repeated it expectation that oil should start pumping in the Falklands in 2017.
The company confirmed a production forecast made in January of 65,000 boepd to 70,000 boepd for this year, a jump of at least 13 percent on 2012’s output.
Shares in Premier, which have risen 21 percent in the last three months, closed at 388 pence on Wednesday, valuing the firm at around 2 billion pounds.
Reporting by Sarah Young; editing by Kate Holton