MedcoEnergi has convened the Annual General Meeting of Shareholders (“AGMS”), in which the AGMS has approved and accepted the Company’s Annual Report and ratified the Consolidated Financial Statements year-ending 2012. The AGMS also approved the appointment of the Board of Commissioners and Board of Directors for the next term of office until the close of the AGMS of 2018. As stated in the 2012 Company’s Financial Statements, MedcoEnergi has managed to record a sales and revenues of US$909.1 million, an 11.2% increase compared to US$817.7 million last year. The largest contributor to this increase comes from sales and revenues in oil and gas which made up US$873.0 million or approximately 96% of the Company’s total sales and revenues while the remainder of US$36.0 million came from sales and revenues of the other energy related business.

The increase of oil and gas sales revenues in 2012 by 9.1%, from the figure of US$800.5 million in 2011, was attributed to the increase in realized oil price from US$113.8/barrel in 2011 to US$115.6/barrel in 2012. In addition, the Company has successfully renegotiated the gas price thereby increasing average selling price of gas to US$4.03/MMBTU in 2012 from US$3.74/MMBTU in 2011. The stable cumulative production of oil in 2012, in the range of 30 million barrels, also contributed to the Company in increasing oil and gas sales revenues.

The Company’s operation performance remains strong. The Operating Income increased by 14.9% from US$220.3 millionin 2011 to US$253.2 million in 2012. The Earnings Before Interest, Tax, Depreciation and Amortization (“EBITDA”) was maintained at USD 341.5 million in 2012, an increase of 5.7% from US$323.0 million in 2011. In exploration, the Company succeeded in increasing its 2P oil and gas reserves (proven and probable) by 29%, from 228 MMBOE in 2011 to 294 MMBOE in 2012. The increase in reserves was mainly due to the Company’s success in exploration efforts in Area 47, Libya and also from the SCS Block.

With a strong operation performance in 2012, the Company has confidently written off several non-performing assets
(impairment). The Company also booked a deferred tax asset at the Company level and one dry-hole exploration well at SCS (South Central Sumatra) Block in the P&L account. The total impairment, deferred tax asset and dry-hole well amounts to US$51 million. With the incorporation of this amount, the 2012 net income attributable to shareholders is recorded at US$12.6 million. The Company strongly believes that the write off will strengthen the Company’s financials in the long run and help to accomplish the corporate’s mid and long term objectives.

With the net income attributable to the shareholders obtained in 2012, the AGMS approves of the distribution of dividends using the same ratio as that in the previous year, which was 30%. The dividends will be paid on 7 June 2013 in the sum of US$3.34 million.
Several of the Company’s Major Projects have seen significant progress. The progress of the Senoro gas development project has reached 13.5% and land acquisition has been completed. The EPC construction of the Donggi Senoro LNG plant has reached 85% completion, 10% ahead of schedule and is expected for first LNG production in the fourth quarter of 2014. The gas development project in Block A has also shown marked progress with the EPC tender nearing completion and the renegotiation of gas price to PIM which is in its final stages. In addition, the drilling of the Matang-1 exploration well in Block A has been completed and is currently in testing period to confirm the existence of new gas reserves. The Enhanced Oil Recovery (EOR) Project in the Rimau Block is currently in a monitoring stage, after completion of the chemical injection in December 2012. MedcoEnergi has successfully increased its oil and gas reserves in Area 47, Libya, thus adding its proven and probable (2P) oil and gas reserves of 44 MMBO and 45 BCF respectively. The establishment of the Joint Operating Company, namely Nafusah Oil Operations, B.V, together with the Company’s partner, i.e. NOC (National Oil Corporation) Libya and LIA (Libyan Investment Authority) was undertaken in February 2013 to begin the development of oil production facilities with a capacity of 50,000 BOPD which is targeted for completion in 2016.

MedcoEnergi’s President Director & CEO, Lukman Mahfoedz, stated that “In the next two years, the Company will continue its efforts to increase oil and gas production