That is, the company's real value is not reflected in the share price.
He did, however, concede this upbeat piece of information: "Although the share price has doubled since the time of the last AGM, we still have a way to go to see our considerable production and income valued in line with our peers, let alone any value attributed to our large Papua New Guinea resource position. "
He said that in PNG, with judicious acreage dealing, subsurface evaluation and appraisal drilling, the company had defined a large gas and condensate resource "in which Horizon Oil has a meaningful ownership".
He added that the company was arguably overweight in the project, providing the opportunity to sell down a part interest to realise cash and provide an indication of value.
"The most important task facing the new management team in the short to medium term will be to unlock the potentially very significant value of our PNG portfolio of assets. Michael Sheridan [taking over as CEO from Brent Emmett in 2018] is intimately familiar with those assets, as well as the rest of our asset portfolio and is well placed to drive. The board is confident that he will perform strongly in his new role," Humphrey said.
Other highlights included:
• Oil sales volumes 3% higher than FY 2016 at 1,421,940 barrels, generating revenue of $68.5 million
• Average cash operating cost down 21% to $11 per barrel of oil sold, driven by further cost savings in response to lower oil prices and a reduction in tariffs applying to Beibu Gulf production
• Net operating cash flow from oil sales after operating expense of $51.7 million, in line with FY 2016
• Continuing disciplined control over administrative and capital expenditures
• Free cash flow breakeven cost over FY 2017 of $32/barrel (including tax, interest and all capex)
• Net debt reduced to $108.5 million (from $131.9 million at June 30, 2016)
• Beibu Gulf and Maari fields continuing to produce steadily at combined rate of about 4000bopd net to Horizon Oil, with remaining cost recovery production entitlement in Beibu Gulf as at June 30, 2017 equivalent to $89.6 million
• Good progress made on planning for Western LNG development project in Papua New Guinea with main project elements now in pre‐FEED; acreage position strengthened and 2C resource materially increased as a result of strategic acquisitions