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Salamander’s production rates fall in 2011

But business improves for the UK energy company in its principal markets.

Salamander Energy’s results for the year ended 31 December 2011 reveal that the British oil and gas group has managed to slash its losses after tax to $45.46m – a substantial improvement on the previous year’s $169.52m.

The group reported revenue of $408m in 2011, an increase of 26.2 per cent compared to $323.4m in 2010. Eighty-three per cent of revenue was derived from oil.

Total exploration expenses fell to $57.8m (2010: $95.9m). During the year, the group disposed of its Offshore Northwest Java and Southeast Sumatra assets in Indonesia, booking a profit on disposal of $6.8m.

Pre-tax profit was $112.6m from continuing operations in 2011, up from a loss of $113.7m the previous year.

However, the average daily output in 2011 fell to 18,600 barrels of oil equivalents per day (boepd) – a substantial decline from 20,300 boepd in 2010.

James Menzies, chief executive of Salamander Energy, said: “2011 was an important year for high-grading the portfolio and refining our strategy. We have also materially grown our reserve base through both successful exploration and commercialising gas resources, and are now reporting record levels of revenue, cash flow and pre-tax profit. We have also taken an important step in defining the potential of our North Kutei acreage with recognition of gross prospective resources of over 670 million barrels of oil equivalent independently verified in the top four prospects.”

The energy group’s principal markets of Indonesia and Thailand continue to grow, despite the difficult global economic conditions. During 2011, the group strengthened its senior management team by creating two new positions: group technical director and exploration manager for Indonesia.

Menzies added: “We are now stepping the operational activity up a gear with two rigs running and a third secured under long-term contract. With our focus on drilling in proved basins where we have a competitive edge, the board sees great opportunities ahead and we look forward to 2012 with a keen sense of anticipation.”

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.