- Net cash from operations of US$19.7 million, EBITDAX of US$18.4 million, gross profit of US$8.8 million and US$18.3 million cash on hand.
- Operating costs 27% lower at US$22.8 million, driven by cost savings in response to lower oil prices.
- Net operating cashflow of US$53.5 million in CY 2016 and forecast at US$50-US$60 million for CY 2017-2022, with modest capex profile.
- Net debt reduced to US$120.8 million with continued reduction planned in CY 2017.
- Cost recovery production entitlement in Beibu Gulf, offshore China, maintains net field production at ~3,000 bopd over CY 2017-2020, with remaining cost recovery entitlement of US$105 million to be received in that period.
- Current net production from Beibu Gulf and Maari, ~4,000 bopd, including cost recovery oil entitlement.
Commenting on the result, Horizon Oil's Chief Executive Officer, Brent Emmett, stated:
"Horizon Oil performed well in the period, with the strong cashflows from our oil projects in China and New Zealand forecast to increase in calendar year 2017. The outstanding US$58.8 million in convertible bonds was successfully refinanced and net debt reduced. The Company's free cash flow break-even of US$33/bbl in 2017 has Horizon Oil well positioned to capture the benefits of stronger oil prices, further materially reduce its debt and, together with hedging, mitigate against oil price volatility.''
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About Horizon Oil Ltd
Horizon Oil Limited (ASX:HZN) (OTCMKTS:HZNFF) is an ASX-listed petroleum exploration and production company, with a geographic focus on the Asia-Pacific region. The company currently produces over 4,000 barrels of oil per day net from its fields in New Zealand and China, which generated over US$80 million in net operating income after operating expense for the year ended 30 June 2015. Further development candidates remain in and around these producing fields.
Horizon Oil maintains prudent policies of oil price hedging and loss of production insurance to ensure that sufficient cash flow is generated to meet the funding requirements of its growth program.
The company holds a large undeveloped reserves and contingent resource position in Western Province, onshore Papua New Guinea. These are liquids-rich gas resources and reflect Horizon Oil’s strategy to focus on Asian gas for growth. Gas constitute about 2/3 of the reserves and resource base. Commercialisation pathways for the gas are emerging.
Although Horizon Oil anticipates continuing strong cash generation over the medium term from its existing producing fields, these developed reserves account for only 10% of total reserves and resource base. The focus going forward will be on new field development, funded largely from existing production cash flow.
Horizon Oil Ltd