Sydney, Mar 1, 2006 AEST (ABN Newswire) - A more than trebling in first half net profit to A$31.2 million has been announced by ASX-listed oil and gas producer and explorer, Beach Petroleum Limited ("Beach") (ASX: BPT) for the six months to 31 December 2005.
The strong result has enabled the Company to declare a half cent a share interim dividend matched with the offer of a 1-for 10 bonus option exercisable at $1.00 to obtain a fully paid ordinary share in Beach by 30 September 2006 - a 13% discount to last night's closing price for Beach of $1.15.
The higher profit - up 227% from $9.5 million achieved in the previous corresponding half year - included a one-off net contribution of $19.4 million from the sale by Beach Petroleum of the sale of 7.9% of its 9.6% shareholding in Anzon Australia Limited (AZA) and the revaluation of its remaining 1.7% shareholding in AZA.
Beach and Anzon's 50:50 joint venture has since November, been commercialising the Basker-Manta oil fields in the offshore Gippsland area of Bass Strait.
The latest record half year net profit did not include any contribution from the joint venture's first Basker oil sales, which were being booked by Beach only from January.
Excluding the Anzon benefit, on a like-for-like basis with the previous corresponding half, Beach Petroleum's net profit after tax and outside equity interest for the period increased 24% to $11.8 million, built on the back of its substantial oil production and sales from the Cooper/Eromanga Basins.
"The result emphasises the underlying profitability of our Cooper Basin production,"
Beach Petroleum's Managing Director, Mr Reg Nelson, said today.
"We expect that the new Basker sales, together with existing and new Cooper Basin production, will help underpin an even stronger result for the remaining half year, as we move towards full field development of the Basker-Manta asset," Mr Nelson said.
The results announced today included (previous corresponding period in brackets):
- A 159% increase in total revenue to $78.8 million ($30.4 million)
- A trebling in operating profit to $41.2 million ($13.2 million)
- A more than doubling in earnings per share (eps) to 7.46 (3.32)
- A 24% rise in output, with 592 thousand barrels of oil equivalent (kboe) produced (479 kboe)
- Sales 11% stronger at 550kboe (495kboe)
- Achievement of an average oil price received of A$84.45 per barrel (A$62.79)
- Eight wells were drilled, three of which proved commercial.
Ninth successive dividend
Directors have declared an interim divided of half a cent per share for those shareholders registered on the Beach Petroleum share register by 31 March 2006 - the Company's ninth successive dividend in the past four years.
The 1-for10 bonus options are offered to all shareholders with registered addresses in Australia and New Zealand at 31 March 2006 and are exercisable by 30 September this year at $1.00 to obtain a fully paid ordinary share in Beach.
"These are outstanding results, and, weather factors aside, we have every confidence the full year result will be even stronger," Mr Nelson said.
"Our business model of increasing our oil production and reserves through exploration and acquisition has driven our growth. It has taken Beach to a true mid-tier producer status fully capitalised as of last night after conversion of all options currently on issue (excluding the new option package announced today) at more than A$610 million.
"In addition, with our timely acquisition of a stake in Queensland's burgeoning coal seam methane gas sector through the Tipton West gas project, and our very active exploration drilling program, we believe that our medium-term position is robust.
"Tipton West gas adds commodity diversification to an already well-diversified oil production portfolio. The Company will seek to continue to build its gas portfolio through new large target exploration in the Otway and Cooper Basins, offshore NZ's South Island and the possible early development of gas within the BMG project area.
"Our focus during the opening half was to exit the direct Anzon stake in favour of gradually moving to our target 50% ownership of the actual BMG project.
"The upside is considerable as the strategy has now delivered Beach net Proved and Probable Reserves of around 15 million barrels of oil at an acquisition cost of only A$3.52 per barrel for undeveloped BMG reserves and A$12.82 per barrel for developed reserves.
"As these assets will increasingly be converted to production from 2006, with full field production scheduled by late this year, the revenue and earnings impact is high."
As at 31 December, 2005, the Company's Proved and Probable recoverable reserves were 19.5 million barrels of oil and 49.6 BCF of gas, totalling 28.1 million barrels of oil equivalent.
Strong exploration push in 2006
Mr Nelson said the Basker-Manta program would be paralleled in the second half by an equally determined onshore exploration and development push.
Beach Petroleum's latest Cooper Basin oil discovery, Kiana-1 (Beach 40% interest), has initially produced at a rate of 750 bopd. Kiana-1 is expected to move to in excess of 1,000 bopd by the end of this month.
In addition, Beach has embarked in the current half on one of its most vigorous half year exploration, appraisal and development programs yet, with 18 wells scheduled over the six months in 3 basins (refer attached table), and comprising:
- 4 oil development wells in the Basker-Manta fields (offshore Gippsland Vic)
- 5 oil appraisal/development wells in the Kenmore field (Cooper Basin Qld)
- 2 oil appraisal/development wells in the Christies field (Cooper Basin SA)
- 2 oil appraisal/development wells in the Sellicks field (Cooper Basin SA)
- 4 exploration wells in the Cooper/Eromanga Basin (SA and Qld)
- 1 onshore exploration well in the Otway Basin (western Vic)
BEACH PETROLEUM: JANUARY - JUNE 2006 DRILLING SCHEDULE
Area Tenement Well Beach Equity Status/TimingS A Cooper PEL 91 Udacha-1 15% Gas Discovery PEL 106 Middleton-1 50% Drilling PPL 205 Christies-4 75% March Christies-5 75% April PEL 92 Silver Sands-1 75% April PPL 204 Sellicks-2 75% May Sellicks-3 75% June PEL 92 Boomer-1 75% June Qld Eromanga PL 32 5 Kenmore wells 100% April-June Otway PEP 160 Glenaire-1 50% May Gippsland VIC L26 Manta-2 37.5% Oil Well Basker-3, 4,& 5 37.5% Batch Drilling March-June
Beach Petroleum's main production is derived from oil/gas production and sales from its onshore Cooper/ Eromanga Basin interests, in particular, the Kenmore and Bodalla South fields in SW Queensland, and from Nov 2005, the offshore Basker-2 oil well in the Gippsland Basin. The Company also has assets in the onshore and offshore Otway Basin in Victoria and in the Carnarvon Basin, off the northern West Australian coast.
Contact
Kevin Skinner
Senior Consultant
FIELD PUBLIC RELATIONS
231 South Road
MILE END SA 5031
Tel: (08) 8234 9555
Fax: (08) 8234 9566
Mob: 0414 822 631
kevin@fieldpr.com.au
Mark Lindh
Investor Relations
TEL: +61 414 551 361
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