PERTH (miningweekly.com) – ASX-listed Senex Energy has started dividend distribution on the back of the successful delivery of its A$400-million Surat basin natural gas development project, which saw revenue and earnings soar in the first half of 2021.
Natural gas production in the first half of 2021 was up 271% to 8 PJ, or 1.4-million barrels of oil equivalent, Senex reported on Monday.
Sales revenue was up by 239% on the previous corresponding period, to A$45-million, while underlying earnings before interest, taxes, depreciation and amortization in the same period were up by A$26-million, to A$25-million.
Operating cashflow increased from a negative A$2-million in the first half of 2020, to A$16-million in the first half of 2021, with free cash flow reported at A$4-million.
Senex MD and CEO Ian Davies said on Monday that it was an excellent start to the 2021 financial year, with the company delivering strong production growth, a material step-change in earnings and cashflow, and with the disposal of its Copper basin business.
“Production in the Surat basin now exceeds 50 TJ/day, or more than 18 PJ/year and equivalent to around 10% of Queensland’s natural gas demand, with natural gas production in the half of 8 PJ exceeding total 2020 production, demonstrating the increase in gasfield production performance.
“We have new investments underway to accelerate production from our extensive natural gas reserves position in the Surat basin. We announced the final investment decision for the expansion of Roma North natural gas production by 50% to 24 TJ/day, with this low-cost, high-return and long-life investment being the first example of Senex’s high-quality investment opportunities to realise the 780 PJ of 2P reserves that we hold,” said Davies.
“Also announced in the half, the sale of our Cooper basin business to Beach Energy for A$87.5-million will provide additional strength to our balance sheet and bolster the cash flow resilience of our natural gas portfolio.
“On the back of our natural gas project delivery performance and resilient production and cashflow outlook, the board has determined to accelerate commencement of dividend distributions to our shareholders, with the company determining to pay our inaugural interim ordinary dividend of 0.5c per share and a special dividend of a further 0.5c per share following completion of the Cooper basin sale.”
Davies said that looking ahead, the company would continue to carefully assess further capital management initiatives along with the accelerated development of its low-risk, high-return organic growth opportunities to achieve its 2025 annual production target of more than 60 PJ per year.
For the full 2021, Senex is targeting natural gas production of between 17 PJ and 18 PJ, with capital expenditure of between A$35-million and A$45-million expected.