ENP Newswire - 20 August 2014
Release date- 19082014 - Cooper Energy Limited (ASX: COE) has announced its 2014 financial results, its strongest to date, to the ASX today.
The announcement, which featured record profit and cash flow results for the 12 months to 30 June, also included a five-fold increase in Contingent Resources and advice of the company's largest ever annual drilling program for FY15.
Statutory net profit after tax for the twelve months to 30 June 2014 (FY14) was $22.0 million compared with $1.3 million in FY13, with the latter figure having been affected significantly by the de recognition of the PRRT deferred tax asset. Underlying profit, which excludes adjustments for PRRT and exploration impairments, was $25.3 million, up 99% from $12.7 million. The increase in underlying profit was driven by record production of 0.59 million barrels of oil for the year, 20% higher than the 2013 production of 0.49 million barrels.
Sales revenue of $72.3 million was 35% higher than the $53.4 million in the preceding period, with the benefits of stronger production being amplified by higher A$ oil prices.
Cooper Energy Managing Director David Maxwell said the company's results in 2014 'rank as its best to date. Production, revenue, profit and cash generation were all the highest yet achieved by the company.'
'The stand-out feature is our Contingent Resources, which was increased five times and now includes valuable gas resources in the Gippsland Basin which are well located for commercialization to supply Eastern Australia's emerging gas needs. We have estimated BMG to hold gross gas and liquids 2C Contingent Resources2 of approximately 28 million boe (Cooper Energy share 18 million boe) and we have commenced the process of analysing and documenting a business case for development,' he said.
Cooper Energy estimates its total 2C Contingent Resources at 30 June to be 35 million boe, up from 5.7 million boe. This figure does not include estimates for the promising Otway Basin gas play identified by the recent deep drilling program, or any unconventional resources.
Year-end reserves have been maintained at 2 million barrels of oil notwithstanding record oil production and an exploration program featuring reduced drilling as the Company invested in seismic data acquisition. Cash and financial assets at 30 June, 2014 were $75.1 million, 10% higher than the opening position of $68.1 million. Cooper Energy remains debt-free.
Mr Maxwell said that the results highlighted the high margin, cash generating capacity of the company's producing assets. 'Cash from operating activities for the year exceeded $51 million. We have funded our largest capital expenditure program to date and still finished with a stronger balance sheet' he said.
Proved and probable reserves at 30 June were 2.01 million barrels of oil compared to the previous corresponding figure of 2.16 million barrels. Mr Maxwell said that the total of 3 oil exploration wells spudded during FY14 was the lowest by the company in nine years as it invested in acquiring and processing seismic data for drilling in future years and gathering technical information for the Otway Basin gas opportunity.
'The analysis and interpretation of this information is expected to flow through to our prospects and leads inventory and will inform our 2015 drilling program,' he said. Cooper Energy anticipates its production for the 12 months to 30 June 2015 will range between 0.50 and 0.56 million barrels. This guidance is exclusive of the impact of exploration success or significant interruptions to production.
Mr Maxwell said that while natural decline resulted in production from some existing fields, the company had expanded its potential for growth, much of which will be tested and matured in the current year.
'The 2015 drilling program includes 18 wells and, for the first time, the majority of exploration wells drilled will be outside the traditional 'engine room' licence area that was PEL 92. This is significant and reflects the company's development and the work undertaken in areas such as our northern Cooper Basin Licences PEL's 90,100 and 110, PEL 93 where a new oil pool discovery has been made, and in Indonesia' he said.
Exploration would account for 10 wells in the program including: five exploration wells planned for the northern licences PELs 90, 100 and 110; four exploration wells in the PRL's 85 - 104 (previously PEL 92), where drilling in the second half will employ information from the interpretation of 3D seismic data and an exploration well budgeted for the Sumbagsel licence in Indonesia.
In the Otway Basin, the identification of a new deep conventional gas play was a highlight of the FY14 drilling campaign. 'The priority for the Otway Basin joint venturers is now to assess the detailed information gathered and then plan further exploration activity' said Mr Maxwell.
'We expect the next twelve months to see significant advances in our gas strategy as we develop the business case for BMG as a commercial source of gas for eastern Australia and in maturing the understanding of the Otway gas opportunity' said Mr Maxwell. 'We are also assessing opportunities to use our strong balance sheet to add production and reserves where value metrics and strategic fit align'.
Cooper Energy Limited
Tel: +61 8 8100 4900
Tel: +61 439 300 932
About Cooper Energy Limited
Since listing on the ASX in 2002, Cooper has built a portfolio of near term low risk development and appraisal projects as well as high impact exploration prospects. Cooper currently benefits from approximately 500,000 barrels of oil production per year from the Cooper Basin, South Australia and the Sukananti KSO in Indonesia.
Cooper also has prospective exploration licenses in Australia (Cooper, Otway and Gippsland Basins), Tunisia and Indonesia. Cooper enjoys a strong balance sheet, good production earnings, and has a clear strategy to enhance shareholder return.