Good morning and good afternoon, ladies and gentlemen. This is Nour Eldin Sherif, and on behalf of Arqaam Capital, I'm pleased to welcome you to Dana Gas Full Year 2025 Preliminary Unaudited Results Conference Call. With me here today is Dana Gas CEO Richard Hall, CFO Chris Hearne, and Head of Investor Relations Mohammed Mubaideen. With no further delay, I'll turn over the call to Mohammed to outline the presentation.
Thank you, Nour. Please allow me to welcome you again to Dana Gas' 2025 Results Call. Please note that the presentation for today's call can be found on our website. I would like to draw your attention to our disclaimer on slide four, which we would encourage you to read carefully. After the presentation, there will be time for a Q&A session. I will now hand over the call to Richard to start.
Thank you, Mohammed, and thank you everyone for taking the time to join our call today. 2025 was a Dana Gas year of delivery. This time last year, I set out a clear set of priorities: delivering KM250, kickstarting our Egypt investment program, improving collections, strengthening the balance sheet, and establishing a sustainable dividend policy. Consequently, we took the lead role in completing one of our largest expansion projects on record, and we completed it 8 months ahead of schedule, materially increasing our capacity in the Kurdistan Region of Iraq. This project added 250 million standard cubic feet of gas per day in processing capacity, and I will return to the Khor Mor gas project in more detail shortly. In Egypt, we also had our own success there, where, as part of our investment program, drilling and workovers resulted in incremental production and material uplift in reserves.
We've arrested the decline in production and returned to growth. We plan to drill a further seven wells in 2026. In January 2026, group production reached 70,000 bbl of oil equivalent per day for the first time in seven years, driven by growth in both the Kurdistan Region of Iraq and in Egypt. Production will increase further once the new Common User Pipeline in Kurdistan is operational, and we will then be able to process at full capacity of around 750 million standard cubic feet a day, which will take Dana Gas production up to 75,000 bbl of oil equivalent per day. So, as you can see, our investments have already delivered a significant uplift in production at the start of 2026, thus setting the tone for a successful year ahead. Importantly, this also means that group revenues will benefit from higher production levels starting in Q1 2026.
As I said earlier, one of my priorities was to establish a sustainable dividend. We were very disciplined with our financials in 2025, preserving profitability throughout the investment cycle. Despite lower prices and lower production in Egypt, we ended the year with a net cash position. On this basis, the board will be considering a dividend recommendation at its March meeting. Let's now turn our attention to slide 5. Our full financials will be covered by Chris very shortly, but what I want to highlight is our collections, again one of my priorities for the year. Number one, we had an excellent year in terms of collections in Egypt, where we collected $99 million. Our trade receivable balance is now down to $38 million, and that's the lowest since 2021.
This reflects concerted efforts by all parties and constructive collaboration with the Egyptian government, and this demonstrates what can be achieved when we all work together. In the Kurdistan Region of Iraq, we billed $217 million and received $204 million, thus giving us a 94% recovery ratio. So, we continue to work through our trade receivable, and that stands at $80 million. With respect to our operations now, I will summarize it over the next few slides in more detail. Please turn to Slide seven for a more detailed summary of our KRI operations. Dana Gas and its partners completed the Khor Mor 250 expansion in October, October 2025, eight months ahead of the revised schedule.
Following the withdrawal of the original EPC, Engineering, Procurement, and Construction Contractor, Dana Gas assumed direct responsibility for execution, rapidly building an in-house project delivery capability, and it worked closely with its partners and authorities to maintain momentum. The successful delivery of KM250 under these circumstances demonstrates the company's ability to execute large-scale, complex gas projects, assist the KRG in fulfilling its commitments under the Runaki 24/7 electricity program, and establish a proven track record that can be leveraged for future developments, including Chemchemal and beyond. The project, as I've said earlier, added 250 million standard cubic feet a day of new gas processing capacity, alongside additional daily LPG and condensate production. In January this year, Khor Mor gas production was ramped up to 700 million standard cubic feet a day, which added an additional 15,000 bbl of oil per day equivalent to the company's net production in the KRI.
Mor, alongside Chemchemal, are two world-class fields within our portfolio. Last year, we put in place a $160 million investment program for Chemchemal, also as part of our customer diversification strategy, Pearl Petroleum, and as a reminder of that, it's made up of Dana Gas, Crescent Petroleum, and its other partners, signed six gas sales agreements, which saw it agree to supply 142 million standard cubic feet a day of gas to major industrial customers in Erbil and Bazian. The strategy also includes expansion into other markets, including Federal Iraq. There will be more announcements on this throughout the year. So, let's turn now to Slide eight. This brings us on to Egypt. We ended the year on a high, having received $50 million as a receivables payment in support of our ongoing $100 million investment program, happening under the consolidation agreement signed with the Egyptian government in December 2024.
The agreement provided better returns in order to support new investment, and that took the shape of 11 wells to be drilled over a two-year period. We've already drilled four wells, and despite one of them being disappointing, our results exceeded expectations. We've added 27 million standard cubic feet a day of production, and through a further workover program across three wells, we delivered a material increase in the reserves. Further, seven wells and additional workovers are planned this year, with the first exploration well, called Daffodil, already spudded last month. 2026 will be an active year in Egypt for the oil and gas, as the program continues in the spirit of collaboration with the government. If you can now turn to Slide nine , this slide provides you with a more detailed snapshot of our production and its breakdown by geography and product.
You can see the breakdown of our production details for KRI and Egypt. We ended the year at an average of 53,500 bbl of oil per day equivalent, and as just discussed earlier, our average production in January ramped up to 70,000 bbl of oil per day equivalent. In the Kurdistan Region of Iraq, our share of production increased in 2025 by 2% to 40,900 bbl of oil per day equivalent. Group production is expected to rise materially throughout the year as output ramps up towards 75,000 bbl of oil per day by year-end. The additional 250 million standard cubic feet a day of gas will be fully monetized by the consortium. Under the long-term standing agreement in place, 305 million standard cubic feet a day is supplied to the KRG with volumes above this level available for sale.
In Egypt, our production fell 23% to 12,600 bbl of oil per day equivalent due to natural field declines. But the success of our drilling and workover programs, which were carried out in 2025 and continue now, and the plan to drill a further seven wells this year, is expected to partially reverse this production decline. Turning now to Slide 10, which highlights the company's realized prices. In 2025, Brent prices were 15% lower year-on-year, from $81-$69 per barrel. This impacted our realized condensate prices, which averaged $38 per barrel compared to $44 per barrel in 2024. We still sell locally in the Kurdistan Region of Iraq, and despite steeper discounts, payments are received in advance.
On the right-hand side of the graph, you can see the realized prices of LPG, which was fractionally lower year-over-year to $33 per barrel of oil equivalent versus $34 per barrel of oil equivalent. I will now hand you over to Chris to talk through the financial numbers in more detail.
Thank you, Richard, and good afternoon, everyone. In addition to the company's strong operational performance, 2025 was also a year of continued strong financial management. Despite lower realized prices and reduced production in Egypt, we succeeded to preserve profitability, maintain a strong balance sheet, and fund growth across our core assets. All of these objectives were achieved whilst investing significant amounts in major projects in each of our areas of operation. Our focus throughout the year was clear: manage cash carefully, support the completion of KM250, progress the Egypt investment program, and maintain liquidity and financial flexibility. That approach is reflected in our results. Please turn to Slide 12 and 13, where I will cover our financial results. As you can see, gross revenue for the full year 2025 declined by $97 million- $348 million.
The decline in revenue in 2025 is, by comparison with the Full Year 2024, which included a one-off exceptional amount of $46 million. This one-off impact was due to additional revenues generated by an increase in the gas price under the consolidation agreement, which was booked in Q4 2024. Excluding this non-recurring item, and on a like-for-like basis, the decline in 2025 revenues was primarily driven by lower production in Egypt and, in addition, by lower realized selling prices. Brent prices were $69 per barrel in 2025 compared to $81 per barrel in 2024. Full-year net profit was $130 million, $21 million less than the full year 2024. Also, 2025 included a one-off impairment of $12 million related to a dry hole in Egypt, an inventory provision, and damage to a storage tank in the KRI. Please turn to Slide 14, which analyzes the company's expenditures during the period.
In 2025, G&A again was in line with previous years at $12 million. This level remains highly competitive versus our peer group. 2025 OpEx was higher at $64 million as compared with $57 million in 2024. The additional OpEx costs related to scheduled maintenance at the El Wastani plant in Egypt, while the increase in the KRI costs was due to one-off engineering projects and IT-related expenses. The company's combined OpEx and G&A costs are below $4 a barrel of oil equivalent and remain within industry's top quartile, reflecting our continued focus on cost discipline, and we expect to improve this still further as production ramps up in the future. In 2025, the company's capital expenditure totaled $105 million compared to $71 million in 2024. In the KRI, Dana Gas' capital expenditure was higher at $66 million due to the completion of the KM250 project.
In Egypt, CapEx was higher at $39 million in 2025 versus $17 million in 2024. The higher CapEx was due to the company's investment program, which included drilling four wells, workovers on three further wells, as well as tie-backs to bring onstream the associated additional gas. With the collection of $50 million in U.S. dollars, we can continue our investment program this year, which includes drilling a further seven wells and additional workovers. We were delighted with the collection level, and this reflects our constructive engagement with the Egyptian authorities and provides the stability needed to continue investing and delivering such good results. Moving on to Slide 15 and 16, which cover the company's liquidity and collections position. The company has made a priority over the last few years to strengthen its balance sheet and improve liquidity, and we have continued to achieve this objective in 2025.
Dana Gas closed 2025 in a net cash position with a cash balance of $215 million, of which $108 million was held at the parent company and $206 million of borrowing. A key objective of the company was also to resume a sustainable dividend to its shareholders, and the company was successful in this regard and was able to pay a $105 million dividend in May 2025. Turning to collections, in the KRI we collected over $200 million in the year, with a realization rate of 94%. Dana Gas's share of receivables in the KRI saw a slight increase to $80 million in 2025 from $67 million in 2024, and this remains an area of focus for the company. During the year, we received regular dividends from Pearl Petroleum, totaling $105 million.
In Egypt, I am delighted to report the collections totaled $99 million, representing a realization rate of 168% and significantly reducing our year-end trade receivables to $38 million, our strongest position since 2021. As additional volumes are brought onstream and monetized, we expect our financial performance to continue to strengthen over time, supporting a stronger balance sheet and further sustainable dividend distributions. And with that, I will hand you back to Richard.
Thank you very much, Chris. At the start of last year, we set out a clear agenda. Number one, deliver KM250 and commence the Egypt investment program. Number two, restore production growth. Number three, strengthen cash generation. And number four, maintain discipline across the business. Number five, and importantly, establish a sustainable dividend policy. Over the course of 2025, we made tangible progress on all of these fronts. As we look ahead, 2026 is about converting this momentum into more sustainable cash generation and dividends. The completion of the new KRI Common User Pipeline will allow us to fully monetize the additional capacity from KM250 and take production up to 75,000 bbl of oil equivalent a day. At the same time, we will continue advancing Chemchemal appraisal and early development to support the next phase of growth, which is already guaranteed with the gas sales agreement signed last month.
The delivery of KM250 has also fundamentally strengthened our capability as a business. For Dana Gas, stepping in where it was needed, building in-house execution expertise, and delivering a complex project ahead of schedule has given us a proven track record that we can now leverage. This experience enhances our ability to progress the next phase of developments, selectively grow, and strengthen our asset portfolio, as well as deploy capital with confidence. Ultimately, this is about building a more resilient business that creates long-term value for shareholders.
Across the portfolio, we remain focused on operational reliability, disciplined capital allocation, and maintaining strong relationships with host governments to support stable collections and investment continuity. We enter the year ahead with a stronger operational base, improved visibility on growth, and a clear path to sustainable cash returns. I thank you for your continued support, and will now hand back to Mohammed to open the Q&A.
Thank you, Richard, and Chris. We will now start the Q&A session. I will kindly ask Nour to moderate this session. You also have my contact details in case any questions come up following this call. Over to you, Nour.
Thank you for the presentation. If you have a question, please raise your hand or submit your question in the Q&A box. We have our first question from Gus. Please go ahead.
Yeah, hi, Jonathan. It's a pleasure to be in touch with you, and thank you for this valuable presentation. I just wanted to ask a couple of questions as follow-ups. One is, of the extra 250 scf that had come online with KM250, can you help us understand the end markets for that? Is that still going to be sold into the industrial Kurdistan industry and region, or is any of that also going to go into Federal Iraq? And then I have a follow-up on Chemchemal.
Hi, Gus. Good to hear from you. Gus, in terms of KM250, if you take the electricity requirements from the power stations that are local, essentially, they produce about or they can produce up to about 4.9 GW a day. Currently, in peak times, they're producing 4.6 GW. The actual industrial sorry, the domestic demand for the Kurdistan Region of Iraq is 3.1 GW. So everything that we sell will be able to provide sufficient gas for generating domestic electricity, and then there's a little bit of surplus as well. So the demand is there, but none of it is actually industrial at the moment. The whole industrial thing is predicated on Chemchemal.
Understood. Thank you, Richard, for clarifying that. I appreciate it and then on Chemchemal, can you help us get an understanding of we saw the recent agreements that were signed, which was excellent, especially so far in advance. Just want to understand, how can we think about that revenue stream and cash flow profile once it's kind of at steady state? Is it comparable to what we're seeing with Khor Mor, or do we need to think about it a bit differently in terms of the economics there?
Hi, Gus. Sorry. Longer term, I would expect Chemchemal to be commensurate with Khor Mor. However, you have to go through an appraisal phase first. So our initial idea is to do an extended well test, and that gas will be used to provide to the first industrial customers and then on top of that, we will have an early production facility, and that will provide the 140 million standard cubic feet a day that we've promised to the industrial users, the full suite of industrial users. Time-wise, our agreements come into validation by the end of 2027, so that's when we're looking at that. Right now, we're doing seismic work. That's happening in the field, and we're applying for all the permits and approvals that we need to carry on and start to drill wells.
Got it. Thank you, Richard.
Thank you. We have a question in the Q&A box. Can you share your estimate on the average OpEx per barrel of oil equivalent following the addition of the 250 million scf per day of production from the KM250 development?
Yeah. Currently, we're at 3.7. That was last year and what we're aiming for is to be under $3 in the coming year. Obviously, part of that is to do with the increase in production, therefore, operating cost per barrel. But also, we're looking at a suite of improvements in how we do business and things like chemicals, etc. So we're optimizing the production operations. We're optimizing everything else and we do have some AI in there as well, which is looking at condition monitoring and frequency of maintenance. In general, we're very, very low cost already, and under $3 is right in the top, probably 10% in the world.
Clear. And additionally, could you provide guidance on the G&A expenses on per barrel of oil equivalent basis post the increase in production?
G&A, this is the corporate G&A, I guess you're talking about. We're looking at $12-$12.5 million per year, pretty much flat on what we've been doing.
Clear. As a reminder, if you have a question, please raise your hand or submit your question in the Q&A box. We'll give it 30 seconds until we get to the next question. Maybe I can jump in with a quick one on the ramp-up in production. How should we look at it from first half towards second half of this year and when the new pipeline should be online?
Yeah, good question. So we were supposed to be limited to 668 million standard cubic feet a day when we brought KM250 online. Since then, we've managed to look at the plant in a critical way, and we actually got up to 720 in January. So significant increase. The peak should be 750 million standard cubic feet a day, and that's when the CUP common user pipeline comes onstream. Now, I've actually driven the line. I've been there. They've laid the line. They're well ahead of schedule on that. However, there are valve stations, which are quite complex construction items. I really don't see that being online until sometime in the third quarter of this year. And that's when we'll hit the 750 and maybe a little bit more than 750 million standard cubic feet a day.
Clear. On the CapEx side, should we expect a pickup in 2026 given the drilling program in Egypt or the CapEx program in Chemchemal?
Yes, hi. Good question. In Egypt, I think it's going to be around the same level that it was last year. That was $40 million CapEx in Egypt. Should be around the same this year.
That's clear. As a reminder, if you have a question, please raise your hand or submit your question in the Q&A box. There are no further questions. I will turn over the call back to management for conclusion remarks.
Thank you very much, everybody, for joining us. Thank God that was a very good year for Dana Gas. We're looking forward to continue this performance. You know my contact. Maybe I'll just leave it for Richard for a final word.
Yeah, thank you all for attending, and thank you all for your support throughout the year. As we said, 2025 was a year of delivery and building a new operational and financial base for this company. I would like to see that our ability to deliver now is leveraged off the team we've built. We stepped in under very difficult circumstances. You can imagine if the contractor left you high and dry when building your house. Well, we had the same sort of event here. So we are into delivery.
We maintain our strategic importance in KRI. We maintain our reliable status in Egypt. And as we've said before, now that we've rebuilt our balance sheet, dividend is a key priority for management, and we have now a sustainable dividend policy. So thank you all for your support and your interest in the company. We look forward to a very good year coming up.
Thank you.
Thank you very much, Nour. Thank you.
This concludes our call for today. Thank you.