(Recasts to focus on production upgrade, adds CEO comment,
details, share price)
LONDON Aug 21 Oil and gas explorer Premier Oil
may upgrade its 2014 production forecast after
stronger-than-expected output in the first half of the year,
pending the outcome of summer maintenance work, its Chief
The company reported a 7 percent rise in first-half profit
after tax on Thursday, helped by strong oil production from its
Premier Oil produced 64,900 barrels of oil equivalent per
day (boepd) in the first half of the year, ahead of the firm's
expectations of around 60,000 boepd.
"We would like to see the end of the summer maintenance
programme before upgrading guidance," newly-appointed Chief
Executive Tony Durrant told Reuters.
Premier Oil's current 2014 output target is 58,000-63,000
The company is in a strong financial position with nearly
$500 million in operating cash flow that it will use to finance
exploration in Kenya, Norway and the Falkland Islands, and to
make dividend payments, it said.
Shares in Premier Oil were trading 0.4 percent higher at
Its four-well drilling programme in the Falkland Islands,
which it says could transform its resource base if successful,
is expected to start in the second quarter of 2015.
Oil and gas drilling in the region remains controversial as
tensions between Britain and Argentina remain high over the
sovereignty of the Falklands.
Premier Oil's new prospect at Solan, west of the Scottish
Shetland Islands, is expected to come on stream by the end of
the year but progress depends on weather conditions.
The Shetlands are tipped as Britain's frontier oil region as
other areas in the North Sea are slowly running out of oil.
(Reporting by Karolin Schaps; Editing by Michael Urquhart)