Peter Barker-Homek, chief executive officer of TAQA, said “There is little doubt that the first quarter of 2009 has been a one of the most challenging to-date, for both TAQA and the global economy. However, despite difficult conditions in global energy markets, which have seen the price of oil hit lows of $41.15 per barrel in February 2009, the results I present today are once again a clear endorsement of TAQA’s diversification strategy and proven management team. They also support our long-term objective of building a distributed asset base in North America, Europe and the Middle East.

We remain committed to rigorous and disciplined cost control and to ensure that as production and net capacity increases, so too do efficiencies across the group.

As I look out into 2009, I take pride in the strength of our position and quality of the team we have built. TAQA remains well funded with no short-term refinancing needs and significant free cash flow to cover existing obligations and fund opportunities for future growth.”

Market overview

During the first quarter of 2009, global energy markets continued to decline sharply, particularly when compared with the first quarter of 2008. This saw the Brent oil price fall from $96.97 at the end of March 2008 to $50.56 at the end of the same quarter of 2009.

This position was also reflected in North America, with the WTI crude price falling from $96.25 to $51.37. Throughout the quarter, US crude oil inventories continued to rise, which put pressure on prices. The lowest point was reached in February 2009, but there has been a steady recovery in recent weeks.

The US dollar also strengthened against the Canadian dollar from CAD1.02 / $1 on March 31, 2008 to CAD1.26 / $1 on March 31, 2009, reaching a high of CAD1.29/$1 on March 9, 2009.


— TAQA’s international and domestic downstream activities are a critical component of its diversified portfolio and now comprise 56% of total revenues and 55% of EBITDA. During the first quarter of 2009, TAQA’s downstream activities generated revenues of AED1.4 billion, excluding supplemental fuel.

— Subsequent to the recent acquisition of power generation facilities in the Caribbean, as at March 31, 2009, TAQA’s downstream operations represents total global generation capacity (gross) of 12,909 megawatt (MW), During the first quarter of 2009, total power production was 9,450 gigawatt hour (GWh), made up of 6,071 GWh in the domestic market and 3,379 GWh internationally.

— TAQA’s total water desalination for the period was 46,211 MIG, with an installed capacity of 654 MIGD.

— TAQA’s domestic portfolio accounts for 79% of the total power and water revenue, with its international portfolio of assets accounting for a further 21% of the total power and water revenue (excluding supplemental fuel).

— Technical availability of the power generation businesses averaged 89.2% with an average domestic availability of 89.2% and an international average availability of 89.3%.

Upstream and midstream

— Upstream activity generated revenues of AED1.8 billion (including gas storage and other revenue), 44% of total revenues and 43% of the total segmental profit.

— Total production was 139.3 thousand barrels of oil equivalent per day (mboe/day) in the first quarter of 2009, split between TAQA North (92.0 mboe/day), TAQA Bratani (40.9 mboe/day) and TAQA Energy (6.4 mboe/day), up from 112.3 mboe/day in the first quarter of 2008.

— Average net realized price of crude oil sold was $35.78 per barrel for TAQA North, $57.42 per barrel for TAQA Bratani and $58.64 per barrel for TAQA Energy.

— Average net realized price for natural gas sold was $4.53 per thousand cubic feet (mcf) for TAQA North, $6.32 per mcf for TAQA Bratani and $10.06 per mcf for TAQA Energy.


— In February 2009, TAQA announced a share buyback programme of up to 10% (622.5 million shares) of the share capital of the firm. At the end of April 2009, TAQA had repurchased 116.7 million shares.

— During the period under review, TAQA repurchased bonds with a nominal value of $201 million (AED738 million). This has resulted in a gain of AED174 million for the period.

Corporate activity during the period

— In March 2009, TAQA completed the $320 million acquisition of a 50% equity stake in Marubeni’s Caribbean energy power portfolio. The deal increases TAQA’s power generation capacity to 12,909 MW (gross) from 10,609 MW; and extends TAQA’s energy value chain to power transmission and distribution.

Post period developments

— At the annual general meeting held on April 21, 2009 the shareholders of the Company approved the payment of a dividend of 15 fils per share totaling AED933 million payable on May 21, 2009.

— On April 23, 2009, ADWEA announced its intention to transfer 90% of its holding in Fujairah Water and Electricity Company to TAQA. Fujairah Water and Electricity Company holds a 60% interest in the Fujairah Asia Power Company which owns the Fujairah 2 power and water plant, currently under construction.

— On May 7, 2009, positive advice was received from the Environmental Impact Assessment (EIA) Commission regarding the Bergermeer Gas Storage project in the Netherlands. This marks an important milestone. Following the Commission’s advice, the EIA and the related consultations have been completed allowing the project to move into the permitting phase.

— On May 12, 2009, TAQA signed a strategic partnership agreement with the Office National de L’Electricite in Morocco to expand the size of the Jorf Lasfar plant by two new units with at least 350 MW of capacity each.