Genel Energy has announced unaudited results for the period ended 30 June 2026.
Paul Weir, Chief Executive of Genel, said:
'We remain firmly focused on delivering our clearly stated strategic objectives and in this period, we have demonstrated our ability to deliver on those objectives. In the first half of the year, the proposed recommended all-cash offer for Capricorn Energy has been a key priority and represents a significant step in our long-standing strategy to diversify geographically, in this case Egypt, a jurisdiction that we have targeted for some time. The acquisition will substantially broaden and diversify our cash generation, while maintaining a very strong balance sheet, underpinned by significant cash resources and low leverage.
In Kurdistan, we continue to work closely with DNO towards normalising production and restoring exports. We will continue to calibrate activity levels based on above-ground conditions, the financial environment and well performance, each of which is subject to ongoing review.
In Oman, we are progressing plans to drill two commitment wells on Block 54 in 2027, while in Somaliland we continue to advance preparations for the potentially transformational Toosan-1 exploration well.
We see much positive potential in the coming six to twelve months.'
Summary
- On 2 July 2026, the boards of directors of Capricorn Energy plc (‘Capricorn Energy’), Genel Energy No.9 Limited and the Company announced that they had reached agreement on the terms and conditions of a recommended cash offer for the entire issued and to be issued ordinary share capital of Capricorn Energy, with the vote of Capricorn Energy’s shareholders to approve the scheme of arrangement expected to take place on 18 August 2026. Genel Energy No.9 Limited has received irrevocable undertakings approximately representing, in aggregate, 39.3% of Capricorn Energy’s issued share capital. Full details can be found on the Company’s website
- Gross average production of 26,400 bopd in H1 2026 (H1 2025: 78,400 bopd), significantly impacted by the suspension of production as a precautionary measure when hostilities between the United States, Israel and Iran commenced at the end of February
- Gross average production up to the date of suspension was 79,900 bopd compared to December 2025 gross average production of 80,700 bopd
- At Tawke, Drilling and Well intervention work resumed in April, and this was followed by a resumption of Production Operations towards the end of the period
- All production in the period was sold domestically
- Working interest average production of 6,600 bopd (H1 2025: 19,600 bopd)
- H1 2026 sales price average was $31/bbl (H1 2025: $33/bbl), with all cash due for domestic sales received in advance of sale
- Production business netback of negative $24 million (H1 2025: $6 million positive) and free cash outflow of $25 million (H1 2025: $5 million inflow), both impacted by suspended production and associated cash flows
- Net cash of $108 million at 30 June 2026 (31 December 2025: $134 million), comprised of:
- Cash of $199 million (31 December 2025: $224 million)
- Bond debt of $92 million due in 2030 (31 December 2025: $92 million)
- After the reporting date, $35 million of new bond debt was issued at price of 104% of nominal amount in July, implying a yield of 9.7%. This issuance brings total debt to $127 million, with the bond facility having capacity for up to $200 million
- Cash of $240 million at 31 July 2026
- Balances with the Kurdistan Regional Government (‘KRG’)
- $88 million (under KBT pricing and excluding interest) remains overdue from the KRG, although this has been reduced by about $40 million of credit balances. We continue to work towards a plan for payment or settlement of amounts owed, and appropriate adjustment for price and interest
- Not included in the $40 million above, Genel Energy Miran Bina Bawi Limited, a subsidiary of the group, owes the KRG around $26 million relating to an arbitration costs award. The appeal against this award, held in April, was unsuccessful and there will be no further legal challenge
- A socially responsible contributor to the global energy mix:
- As part of the Genel20 Scholarship, Genel commenced the second phase of the Genel Scholars programme which, in addition to academic support, is now providing one-to-one mentorship from a Genel professional to students enrolled under the scholarship
- In Somaliland, Genel continued to engage with local communities through an emergency water distribution project and bolstering education facilities in the region?
Outlook
- The Company continues to progress towards building a business with a strong balance sheet that delivers resilient, reliable, repeatable, and diversified cash flows that support a dividend programme
- Proposed acquisition of Capricorn Energy
- Subject to satisfaction of regulatory conditions, we look forward to combining the businesses, with a long-term funding plan in place
- Tawke resilient cash generation
- Free cash flow from domestic sales at current production and price levels is expected to more than cover point-forward organisational costs
- Working with stakeholders to support the restart of exports and access to international pricing, more than doubling asset free cash flow
- Pursuit of circa net $50 million owed by the Kurdistan Regional Government
- Pre-production investment and derisking resources
- Incremental to the production business, the Company will invest up to $15 million over the year on its pre-production assets
- On Block 54 in Oman, in line with the 3-year initial exploration phase work plan, we continue to work towards acquiring 3D seismic and drilling two wells
- SL10B13 in Somaliland, we continue to make steady progress towards drilling the Toosan-1 prospect in 2027
- Balance sheet strength
- We have maintained a very strong cash position through the period of suspended production
- Since the restart of production, we are cash generative and retain access to further available liquidity
Source: Genel Energy
