Brisbane, Aug 29, 2008 AEST (ABN Newswire) - Beach Petroleum Limited (ASX:BPT)(PINK:BEPTF) is paying a steady annual dividend following another strong operating performance by the company's expanded oil and gas operations in the year ended 30 June 2008.
Normalised net profit after tax jumped 69.2% to A$52.7 million compared with
A$31.2 million in the previous financial year, before taking into account the impact of the Company's previously announced hedge book closure.
Highlights of the 2007-2008 operating performance included:-
- Record total revenue up from A$574 million to record A$685 million
- Oil and gas sales of record A$564 million (previous year A$472 million)
- 73.1% higher net cash flow - up to A$199.8 million
- Further increase in petroleum reserves to record levels
- Net assets above $1 billion at balance date
Cash on hand at 30 June 2008 was A$376.5 million (previous year A$74.7 million)
Directors have declared a steady 1 cent per share final dividend, maintaining the annual dividend at 1.75 cents per share. The final dividend will be paid on 24 October 2008 to Beach shareholders registered on 3 October 2008.
If the impact of Beach's decision to pay off commodity hedging with the closure of a major part of its hedge book is included, net profit after tax for the past financial year was A$63.7 million (previous year A$103.8 million and EBIT was A$108.6 million (A$189.1 million).
The closure of the hedge book has enhanced Beach's exposure to the higher global spot prices for oil instead of being pinned down to unrealistic hedge prices - some of which were inherited on acquisition of the Delhi group of companies in late 2006.
"By largely freeing the company from the price hedging shackles and the tie to West Texas Intermediate (WTI) prices rather than much more profitable Tapis spot prices, we look forward to a further handsome revenue and cash flow boost in the current year," Beach's Managing Director, Mr Reg Nelson, said today.
"For instance, up to 90% of our oil sales are available to be sold into the spot price oil market - mostly at Tapis plus a premium - in the current December half at prices considerably higher than Beach would have realised under its now dispensed with oil hedge obligations," Mr Nelson said.
A feature of Beach's 2007-2008 performance was the sharp increase in its petroleum reserves backing - even after strong oil and gas production during the year and the sale of a further 10% stake in the producing Basker-Manta -Gummy (BMG) project off Victoria for $123 million..
"While our divestment of further 10% in the BMG project allowed Beach to capture value and seek out other opportunities, we have still been able to increase our reserves over the year by 62% to 145 million barrels of oil equivalent (MMboe)," Mr Nelson said.
"The divestments of portions of our holding in the BMG project was largely offset by an increase of 8.5 MMboe in our Cooper-Eromanga basin reserves, the bulk of which was oil at highly profitable prices," he said.
"In addition, our agreement to acquire a 20% interest (for US$110 million) in the North Shadwan concession in the Gulf of Suez is expected to yield a net increase in Beach's reserves of a further 8 MMb, through three oil fields that we expect to develop with BP as operator over the next year or two."
Mr Nelson said the outlook for Beach remained exceptionally good, including increased recognition expected for the Company's involvement in the coal seam gas and geothermal industries.
"Elsewhere, the immediate outlook for drilling includes three potentially high impact exploration wells offshore from Victoria and Tasmania, with two rigs now contracted to accelerate additional exploration, delineation and development wells in the BMG project," he said.
"Subject to the approval of the Egyptian authorities, we expect to be involved in a variety of activities in the Gulf of Suez, starting in the latter half of 2008.
"This activity includes an oil appraisal well in the Burtocal oil field, planning for development of this and two other oil field discoveries in adjacent waters and an exploration oil well further north in the Gulf on the July South prospect, adjacent to BP's Saqqara oil field which came on stream in May 2008 at a reported rate of 30,000 bopd.
"A drilling rig has been secured to drill a Paralana geothermal well in early 2009 and. Cooper-Eromanga basin drilling is expected to continue apace."
Contact
Reg Nelson
Beach Petroleum
08 8338 2833
Mark Lindh
Adelaide Equity
0414 551 361
Ian Howarth
Farrington National
03 0223 2455
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