Microsoft Word - CUE ASX Release CoverNEW
ABN 45 066 383 971
22 January 2016 PAGES (including this page): 16
ASX Market Announcements ASX Limited
Exchange Centre
Level 4, 20 Bridge Street
Sydney NSW 2000
Quarterly Report for Period Ended 31 December 2015
Attached please find Cue Energy Resources Limited's release with respect to the above mentioned.
Yours faithfully
Andrew M Knox
Chief Financial Officer
CUE ENERGY OVERVIEW
Cue is an Australian based oil & gas company with activities in Australia, New Zealand, Indonesia and the USA.
THE COMPANY HAS:
OFFICE
Level 19
357 Collins Street
Melbourne Vic 3000
CONTACT DETAILS
Tel: +613 8610 4000
Fax: +613 9614 2142
EMAIL
[email protected]
WEBSITE
www.cuenrg.com.au
LISTINGS
ASX: CUE
ADR/OTC: CUEYY
Quarterly Report
Q02 FY16 | December 2015
SUMMARY OF ACTIVITIES
Production
-
The Maari Field in New Zealand (Cue 5%) was producing ~13,500bopd at the end of 2015. Successful workovers have been completed on both MR3 and MR9 and several more are scheduled for Q1 calendar 2016 with the intention of increasing the production rates of underperforming wells. In Q1 calendar 2016 an upgrade to the Maari mooring system and repair to the water injection flow-line is planned. It is anticipated that once water injection is reinstated it should provide pressure support to several of the producers and enhance both short term and long term production.
-
Oyong and Wortel Fields in the Sampang PSC (Cue 15%) in Indonesia are producing at a total combined gross rate of ~1100 bopd and ~75 mmcfcd at the end of 2015. Oyong is now fully benefitting from the increased gas price which came into effect during the year. The onshore gas compression at the Grati gas plant is helping to sustain deliverability from Wortel at 45 mmcf of gas per day. Studies are now underway to extend field gas production from Oyong and Wortel.
Exploration
-
Operations in Indonesia for drilling in the Mahakam Hilir PSC at Naga Selatan-2 (Cue 100% and operator) continued with the construction of the road and drilling location completed in Q4 calendar 2015. The rig contract was also completed in Q4 calendar 2015 and the Naga-Selatan-2 well spudded on 7 January 2016 with an estimated time to drill of 2-3 weeks depending on drilling results.
-
In the Mahato PSC (Cue12.5%) in Indonesia planning is underway by the operator to drill one well and acquire 2D seismic in 2016-2017.
-
The Te Kiri North-1 (Cue 20%) well in New Zealand spudded on 16 December 2015 and a decision to plug and abandon the well was made on 19 January 2016. The Miocene oil objective had uncommercial oil shows.
-
Cue has identified and matured the 15 TCF Mungaroo Formation Ironbark gas prospect which straddles both the WA-359-P and WA-409-P permits offshore Western Australia (Cue 100% and operator). A process is now underway to farm-out a material interest in both permits.
Financial
-
Quarterly revenue receipts from hydrocarbon production for the quarter were $13.92 million on sales of 76,525 barrels of oil at an average price of US$44 per barrel and 1,001 million cubic feet (mmcf) of gas at an average price of $9.26 per Mcf.
-
Approximately 67% of revenue receipts are derived from non-oil linked gas sales which are not affected by current low oil prices.
-
Cue has no hedging in place.
-
Cue has no debt.
-
$29.61 million cash on hand at the end of the quarter.
Production & Financial Summary
|
KEY PERFORMANCE METRICS
|
Dec Quarter Q2 FY16
|
Sept Quarter Q1 FY16
|
Change
%
|
|
Oil Production (net to Cue)
|
bbl
|
80,802
|
86,829
|
(6.94)
|
|
Gas Production (net to Cue)
|
mmcf
|
873.02
|
764.19
|
14.24
|
|
Oil Liftings (net to Cue receipts)
|
bbl
|
76,525
|
66,120
|
15.74
|
|
Gas Liftings (net to Cue receipts)
|
mmcf
|
1001
|
669.20
|
49.59
|
|
Total Revenue Receipts
|
$m
|
13.92
|
10.57
|
31.69
|
|
Production Expenditure
|
$m
|
3.23
|
5.14
|
(37.16)
|
|
Closing Cash Position
|
$m
|
29.61
|
26.61
|
11.27
|
ACTIVITY REVIEW
AUSTRALIA EXPLORATION - Carnarvon Basin
WA-359-P
Cue Interest: 100%
Operator: Cue Exploration Pty Ltd
Cue has evaluated the regional prospectivity in all of its Western Australia offshore permits and has identified an exciting new play type associated with the prolific gas- bearing Mungaroo Formation. The "Ironbark" prospect, a Mungaroo Formation prospect with multiple objectives, has been identified as the primary candidate for drilling and Cue estimates that it holds a success case best technical estimate of 15TCF of gas reserves. A farm-out process to find suitable joint venture partner(s) to participate in the drilling of the well is ongoing with several international oil companies currently evaluating the opportunity.
The Company has been notified by the National Offshore Petroleum Titles Administrator of the approval of its application for a suspension of the Permit Year 3 work programme commitment for WA-359-P. The Year 3 work
programme comprises the drilling of one exploration well which is now due by October 2016.
WA-409-P
Cue Interest: 100%
Operator: Cue Exploration Pty Ltd
The Ironbark prospect has been mapped as straddling both WA-359-P and WA-409-P. Cue plans to farm-out a material interest in both the WA-359-P and WA-409-P permits which ensures the entire prospect is included in the commercial offer. Ironbark is planned to be tested by a well in WA-359-P and if successful, subsequent possible appraisal drilling would take place in WA-409-P.
WA-360-P
Cue Interest: 37.5%
Operator: MEO Australia Limited
All obligations have been met for this Block and Cue will be withdrawing in Q1 calendar 2016 with no further financial commitments.
WA-361-P
Cue Interest: 15% Operator: MEO Australia Limited
All obligations have been met for this Block and Cue will be withdrawing in Q1 calendar 2016 with no further financial commitments.
WA-389-P
Cue Interest: 40%
Operator: BHP Billiton Petroleum (Australia) Pty Ltd
Reprocessing of existing 2D and 3D seismic data has been approved by the Joint Venture and is expected to be completed in Q1 calendar 2016. A full evaluation of the prospectivity of the Block is planned for 2016 with the anticipation of farming out prior to committing to a well.
NEW ZEALAND EXPLORATION - Taranaki Basin
PEP 51149
Cue Interest: 20%
Operator: Todd Exploration Limited
The Te Kiri North-1 well spudded on 16 December 2015 and as of year-end 2015 was drilling the potentially oil-bearing objective in the Miocene-age Mount Messenger Formation. A decision to plug and abandon the well was made on 19 January 2016 as the well only encountered non-commercial oil shows. Drilling of the well fulfills Cue's permit obligations.
PEP 54865
Cue Interest: 20%
Operator: Todd Exploration Limited
The permit carries a minimum work
programme of 285 km² of 3D seismic to be acquired, processed and interpreted prior to June 2016. The Joint Venture was unable to secure a seismic vessel for Q1 calendar 2016 and, subject to government consent, will now have to defer the seismic acquisition work programme until a suitable vessel can be procured.
PEP 51313
Cue Interest: 14% interest
Operator: OMV New Zealand Limited
The Joint Venture is focused on assessing the remaining potential associated with the Matariki trend, up-dip of the Maari field. Studies are being completed by the operator to determine the feasibility of acquiring additional 3D seismic to reduce the geologic risk of the remaining prospects. Cue will need to make a decision by 30 July 2016 whether to proceed into the next stage of the permit which will include either the acquisition and processing of 100sqkm of 3D seismic or the reprocessing of 100sqkm of 3D seismic.