Harbour Energy plc has released its unaudited Trading and Operations Update for the nine months ending September 30, 2023. The company reported that production averaged 189 kboepd, a decrease from 207 kboepd in the previous year. The production split was approximately 50% liquids and 50% gas. The company maintained its full-year production guidance of 185-195 kboepd. Operating costs averaged $16/boe, an increase from $14/boe in the previous year, but the full-year guidance remains unchanged at approximately $16/boe. Harbour Energy highlighted its strong safety record, with a total recordable injury rate of 0.9 per million hours worked.
The company provided updates on its investment opportunities and growth projects. In the UK, Harbour Energy is progressing with high return, short cycle, infrastructure-led investment opportunities. The Tolmount East production start-up is underway, which will increase future rates from the Tolmount area. The Leverett discovery, near Harbour's operated Britannia infrastructure, has been successfully appraised, and a planned final appraisal side track is underway. The Talbot project is on track to deliver first oil around the end of 2024, with two of the three development wells completed.
Internationally, Harbour Energy is advancing its growth projects, which have the potential to materially increase its reserve life. The drilling of Layaran, the first of a multi-well Andaman Sea (Indonesia) exploration campaign, is ongoing. Three additional prospects on the Andaman South and Andaman II licenses will be drilled as part of this campaign. In Mexico, commercial agreements for the Zama project are progressing, with preparation for FEED (Front-End Engineering and Design) underway. The Kan appraisal plan has been submitted to the regulator, and drilling is scheduled for 2024 following the oil discovery in April.
Harbour Energy also provided financial highlights for the period. Estimated revenue was $2.9 billion, with realized post-hedging oil and UK gas prices of $77/bbl and 53 pence/therm, respectively. The company reiterated its total capex guidance of approximately $1 billion for 2023, reflecting increased drilling activity in the second half of the year. The forecast for 2023 free cash flow is approximately $1 billion, after expected total cash tax payments of $0.4 billion, and before shareholder distributions. Shareholder distributions of approximately $440 million have been completed year to date, including share buybacks and an interim dividend. The net debt at the end of the period was approximately $0.3 billion, with the potential to be net debt-free in 2024. Harbour Energy also announced the successful outcome of an amendment and extension of its RBL (Reserve Based Lending) facility, with the borrowing base increased to $1.3 billion and maturity extended to December 2029.
Linda Z Cook, Chief Executive Officer of Harbour Energy, commented on the company's performance and future plans. She highlighted the company's focus on maximizing the value of its UK oil and gas portfolio and progressing diversification opportunities in Mexico, Indonesia, and CCS (Carbon Capture and Storage). Cook mentioned that Harbour Energy is evaluating material M&A (Mergers and Acquisitions) opportunities in line with its strategy to build a global and diverse oil and gas company. She noted that market conditions for M&A are improving and the company remains disciplined in balancing shareholder returns and value accretive M&A opportunities.