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Senex reports Q3 results

Written by  Tuesday, 25 April 2017 21:26
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During the Q3 2017 financial year, Senex Energy recorded 14% lower sales revenue of AU$11 million but achieved a few corporate developments by pursuing new opportunities.

Sales volumes for the March quarter were 170,000 bbl, down 15% from the previous quarter due to temporary mechanical issues on several wells, the Brisbane-based company said.

In February 2017, Senex sanctioned its first major investment in the Western Surat gas project in Queensland, Australia.

The firm committed $50 million to a 30 well drilling campaign across the onshore Glenora and Eos blocks, expected to produce 10 TJ/d by mid-2018.

This investment will also cover appraisal activities to be undertaken in other parts of the Western Surat gas project acreage later in 2017, facilitating staged full field development.

Drilling will commence on the Eos block in May 2017 and run over the course of the calendar year, Senex said, adding that first wells are expected to come online in mid-2017.

Construction of gas and water handling infrastructure will be undertaken in parallel, including the refurbishment of the existing dam located on Eos for use during Phase 2.

Senex is progressing material gas opportunities in the onshore Cooper basin in Queensland. During the March quarter, it commenced drilling of the Silver Star-1 well as part of a $105 million unconventional exploration program with Origin Energy. Currently, a 1500m horizontal section is being drilled.

In February 2017, the group announced it had formed a strategic relationship with specialist energy investor EIGGlobal Energy Partners. EIG became a substantial shareholder in Senex, holding 12.2% of Senex’s issued share capital. A total of $55 million was raised through the institutional placement to EIG.

The duo plan to work together to develop and expand Senex’s upstream positions in both the Surat and Cooper basins, including agreeing on a funding model to accelerate development of the Western Surat gas project.

In addition, Senex has placed bids for newly released Surat and Bowen basin acreage and signed a new long-term sale and purchase agreement for Cooper basin oil, with the South Australian Cooper basin joint venture comprising of Beach Energy, Santos and Origin.

In the first half of FY17 ending 31 December 2016, Senex saw a 38% year-on-year decrease in oil and gas revenue. Earnings dropped to $22.8 million, primarily driven by low oil prices, and production was 410,000 boe, down 24% as a result of natural field decline and significantly lower capital expenditure over the previous two financial years.

Image: Work underway at the Western Surat gas project / Senex

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