Australia's AWE Posts Underlying Net Loss After Tax of $37.52M
Australia's AWE Limited announced Monday its full year results for the 2014-15 financial year. The Company reported annual production of 5.1 million barrels of oil equivalent (MMboe), sales revenue of $204.96 million (AUD 284 million) and a statutory net loss after tax of $166.01 million (AUD 230 million), which included $114.04 million (AUD 158 million) of non-cash impairments (after tax). After adjusting for non-recurring items, AWE’s underlying net loss after tax was $37.52 million (AUD 52 million).
Managing Director, Bruce Clement, said: “AWE had another year of significant achievements and is managing the negative impact of low oil prices on the financial results. Production of 5.1 MMboe was at the top end of guidance and development and exploration expenditure was within the guidance range, reflecting our continued focus on cost control. Sales revenue was only 2 percent below guidance, which was a substantial achievement given the lower realized average oil price during the year.”
“At year end, AWE had significantly increased its net 2P Reserves by 23 MMboe, or 25 percent up over the previous year, to 114 MMboe. This equates to more than 22 years of production at current rates. Similarly, AWE increased its net 2C Contingent Resources by 44 MMboe, or 57 percent, to 121 MMboe, and the majority of these assets have the potential to be reclassified as 2P within the short to medium term,” he said.
“The major highlight for AWE during the year was the very successful Perth Basin exploration and appraisal program, where the Company has booked over 700 billion cubic feet (Bcf) gross of 2P Reserves and 2C Contingent Resources. The program resulted in the discovery of the Waitsia gas field, which was upsized following evaluation of Waitsia-2 well results to reflect combined gross 2P Reserves and 2C Resources of 484 Bcf (net 43 MMboe to AWE).
“The Waitsia field is the biggest onshore conventional gas discovery in Australia in the last 30 years and potentially Australia’s fourth largest onshore gas field, based on remaining conventional 2P Reserves. Waitsia has been prioritized for commercial development and we are moving quickly to implement low cost, early-stage production, using existing wells and facilities, with the aim of selling gas into the domestic Western Australia market by mid-2016. Our success in the Perth Basin has established a substantial new domestic gas business in Western Australia of significant value for AWE,” Clement said.
“The positive operating performance was impacted by the declining oil price which resulted in a noncash impairment of $36.80 million (AUD 51 million) after tax for Tui and Cliff Head, both mature oil producing assets. In the second half, the reduction in Yolla Reserves resulted in a $76.5 million (AUD 106 million) after- tax non-cash impairment for BassGas.
“During the year, AWE made significant progress in responding to the low oil price environment and we remain focused on improving operating efficiency, maximizing cash flows and achieving further cost savings.
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