Posted on 28 August 2020

  • Reserves upgraded
  • Revenue $ 3 m (down from $43.3m last year
  • Group NPAT improvement $0.8m loss (loss of $2.9m last year)
  • Cash balance $110 .8 m (up from $105.6m)

New Zealand Oil & Gas has today announced steady financial performance, an increased cash balance, and significant reserves upgrades.

2P (proved and probable) reserves were upgraded across the portfolio from a production adjusted 1.84 million barrels of oil equivalent (mmboe) to 2.26 mmboe* at Kupe in New Zealand, and from production adjusted 1.04 mmboe to 1.09 mmboe* at Sampang in Indonesia. New contingent resources in Indonesia have also been announced.

For the 12 months to 30 June 2020, New Zealand Oil & Gas announced a net loss for the group of $0.8 million, up from a net loss last year of $2.9 million. The NPAT attributable to New Zealand Oil & Gas shareholders was a loss of $1.4m, compared to a loss of $7.5 million in the previous financial year.Revenue for the year was $37.3 million, down from $43.3 million for the year before. Cue contributed $25.2 million to revenue ($27.5m last year).

Revenue from Kupe production was $12.0 million ($15.9m last year). The cash balance increased to $110.8 million at 30 June 2020, up from $105.6 million.

The cash balance will reduce later this year as the company contributes to the cost of drilling the Ironbark well off Western Australia, currently anticipated to be drilled in the fourth quarter of calendar year 2020. Cue has estimated that the Ironbark prospect holds 15 trillion cubic feet of prospective recoverable gas.**

No dividend has been declared.

Chief executive Andrew Jefferies commented on the steady financial result and increased reserves in a year of unprecedented turmoil in the industry.

"The pandemic disrupted global markets but our production facilities were able to keep operating. Our revenues remained strong as our portfolio is dominated by gas, connected to pipeline markets with long term contracts.

"It is very exciting to be involved in a frontier well like Ironbark. Though drilling this prospect will reduce our cash balances, we will still have a significant war chest available to deploy if suitable assets become available in Australia and New Zealand. We expect steady revenue from our producing assets and costs have been reduced.