Scotland business

Aberdeen-based Faroe Petroleum runs into the red

Faroe Petroleum logo Image copyright Faroe Petroleum

Faroe Petroleum, the Aberdeen-based independent driller, ran into the red during the first half of this year.

Revenue fell from £51m to £23m, as the oil price dropped.

It sank to a £34m operating loss, whereas the first half of 2015 saw a pre-tax profit of £6m.

The exploration and production company reported a drop in capital expenditure from £25m to £14m - but it has had a successful time in drilling for new fields.

The Brasse field, in the Norwegian North Sea, is reckoned to have between 43 million and 80 million barrels of oil or its gas equivalent. Faroe owns half of it.

It bought 20 million barrels of North Sea reserves from Dong Energy, of Denmark.

That is expected to nearly double its production, to between 16,000 and 18,000 barrels per day.

Faroe has also won new licences to explore in the Norwegian sector and in Irish waters.

Full-year capital expenditure on exploration, development and production is expected to fall from £85m last year to £65m during 2016.

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