Photo by: Bloomberg
PERTH (miningweekly.com) – The board of ASX-listed Senex Energy has approved a capital spend of between A$220-million and A$250-million to develop its Project Atlas and Roma North natural gas projects, in the Surat basin.
The multi-year work programmes were approved following the financial close of a A$150-million debt facility.
“Final investment decisions for Project Atlas and Roma North and sanctioning of their work programmes are significant milestones for Senex,” said MD and CEO Ian Davies.
“The work programmes set the roadmap for development of our long-life natural gas assets as we become a material supplier of gas to the east coast market. We now embark on a cornerstone year for Senex, creating the foundation for a step-change in production and cash flow over the near term, while maintaining significant optionality for ongoing growth from our existing acreage.”
Davies said that a more than four-fold increase in yearly production to four-million barrels of oil equivalent demonstrated the step-change that Senex was targeting.
Project Atlas is expected to reach a plateau production of 32 TJ/d, or about two-million barrels a year of oil equivalent, with an additional 8 TJ/d of installed redundant capacity available.
Roma North will be developed for a minimum initial production capacity of 16 TJ/d, or about one-million barrels a year of oil equivalent, with the ability to rapidly expand to 24 TJ/d.
Plateau production at both projects is expected by the end of the 2021 financial year.
Between the 2019 and 2021 financial years, Senex will be conducting integrated drilling across both projects, with some 110 development wells to be drilled over an 18-month period, starting late in the third quarter of the 2019 financial year.
Meanwhile, Senex on Monday also updated its production guidance for the 2019 financial year, with the ASX-listed company now expected to produce between 1.1-million and 1.5-million barrels of oil equivalent, up from the 800 000 barrels of oil equivalent produced in the 2018 financial year.
The production growth will be driven by recent oil drilling successes and gas volume ramp-up.
Capital expenditure for the 2019 financial year is expected to be between A$110-million and A$130-million, compared with the A$80-million spent in the previous financial year, on the back of the acceleration of the Surat basin developments and active oil exploration and development in the Cooper basin.
“2019 will be an active and exciting year for Senex as we accelerate exploration and development programmes to drive a step-change in production and cash flow,” said Davies.