Cue back in black

A FULL year of production from the Maari field in New Zealand has resulted in Cue Energy Resources recording a net profit of $27.5 million for the 2010 financial year.
Cue back in black Cue back in black Cue back in black Cue back in black Cue back in black

The profit result is a turnaround from the $24.9 million loss recorded in FY2009 due to impairment write-downs of exploration expenditure in Indonesia and Papua New Guinea.

Production income for the year was up 80% to $54.7 million on production of 589,295 barrels of oil and 2.12 petajoules of gas.

Cue hedged 120,000bbl at $US86 a barrel for about 25% of its production which added $2 million to its profit.

The Maari oil field contributed 360,750bbl while production from the Oyong field in Indonesia was 188,101bbl of oil and 2.12PJ of gas.

Gas production from Indonesia is expected to increase late in 2011 once first gas begins from the Wortel gas development.

Chief executive officer Bob Coppin said negotiations for the sale of Wortel gas are proceeding and a decision on field development is expected in October with first gas production late in 2011.

The development of the Wortel gas field includes a well head platform, two gas development wells and a 7km pipeline to the Oyong facilities.

Chairman Richard Tweedie said the company expected to receive a significantly higher price for Wortel gas compared to Oyong gas.

In PNG, production from the SE Gobe field was 40,444bbl despite the field's natural decline.

During the year, negotiations took place with PNG LNG operator ExxonMobil to sell SE Gobe gas to the LNG project once production begins in 2014.

According to Coppin, a gas sale is expected to prolong the field's life to around 2023.

As at September 30, the company had $38 million in cash and reduced debt to $US10 million.


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