Nostrum Oil and Gas' shares are up after the firm's cost cutting measures and production levels exceeded expectations in its 2016 operational update.
In the oil firm's full-year operational update, average daily production was 40,351 barrels of oil equivalent per day (boepd), which was slightly above guidance of 40,000 boepd.
Average production was higher in the fourth quarter, reaching 44,708 boepd.
Revenue for the year is expected to be more than $340m (£270m), while net debt remains at $860m as of 31 December.
Shares were up 6.36 per cent at 471.50p at the market close.
Why its interesting
After a tough year in 2015, when earnings fell 54 per cent, Nostrum is making a comeback as it finds new cost cutting measures.
Nostrum successfully completed a drilling programme in 2016 which included the commissioning of three new production wells.
The oil firm is constructing a third gas processing facility, GTU3, which is progressing on budget and schedule for completion in 2017. The new unit will more than double production capacity to above 100,000 boepd.
Its KazTransOil (KTO) pipeline connection is also on track for commissioning by the second quarter of 2017. This will significantly reduce crude oil transportation costs.
What Nostrum said
Kai-Uwe Kessel, chief executive of Nostrum, said the fourth quarter was the company's strongest period of the year as oil prices improved and average daily production increased.
We have successfully reached our production target for the full year, averaging over 40,000 boepd, and continue to produce in line with guidance. We also completed our drilling programme as expected, with better results than anticipated from two out of the three production wells.
What analysts said
Numis said fourth quarter production was four per cent ahead of analysts' guidance
The longer-term production outlook, albeit marginally reduced from prior guidance, is in-line with our prior forecasts and reflects our forecast pace of drilling activity.
Completion of the gas processing facility (GTU3) will provide Nostrum with the processing capacity to more than double production over the next five years. The oil tie-in pipeline to reduce operating costs remains on schedule to be operational by the second quarter of 2017.
We estimate the company can fund a dividend yield of 6 per cent on the current share price in 2022 once production ramps up.