Jadestone Energy, an independent upstream company focused on the Asia-Pacific region, has provided a trading update for the half-year ended 30 June 2024. The financial information in this update has not been audited and may be subject to further review and change.
Key updates
- Akatara mechanical completion and gas-in achieved in June 2024. The export pipeline from the field has been successfully filled with on spec sales gas, with exports into the regional trunkline expected to commence imminently.
- Record H1 2024 Group production averaged 16,867 boe/d, higher than any prior six-month period and representing 37% growth on H1 2023.
- H1 2024 oil liftings more than doubled year-on-year, driving a 131% increase in proceeds from liftings to US$200.5 million. After reflecting hedging losses of US$15.4 million, revenues for H1 2024 totalled US$185.1 million.
- H1 2024 total production costs were flat compared to H1 2023, despite production increasing 37%, with increased CWLH opex as a result of the CWLH 2 acquisition offset by lower spend year-on-year at the non-producing SFA Cluster assets, Montara and Stag.
- Net debt of c.US$72.7 million and available liquidity of c.US$151.0 million at 30 June 2024 (net debt of US$3.6 million at 31 December 2023).
- Closed the CWLH 2 acquisition in February 2024, increasing the Company's interest to 33.33% in an outperforming asset. The final CWLH 2 Abandonment Trust Fund payment has reduced from US$37 million to c.US$19 million, to be paid on or before 31 December 2024.
- Award of the SFA Cluster PSC offshore Peninsular Malaysia in July 2024, adding another potentially significant growth opportunity to the Company's portfolio.
Guidance
While Jadestone continues to see Group production for 2024 at c.20,000 boe/d, the annual production guidance range is adjusted to 18.5-21,000 boe/d, from 20-22,000 boe/d, reflecting year-to-date production after significant Q1 2024 weather impacts, and the revised timing of the start of Akatara commercial sales. The lower end of the range also incorporates a conservative assumption on Akatara production in the early stages of the processing facility's operating life, and a range of potential downside scenarios across the portfolio.
Operating expenditure guidance for 2024 is narrowed to US$240-280 million (excluding forecast royalties and carbon taxes of c.US$30.0 million), from US$240-290 million, reflecting year-to-date performance.
Capital expenditure guidance is unchanged at US$80-110 million and other cash expenditure for the year is revised down from c.US$77 million to US$62 million, primarily reflecting the finalisation of the CWLH Abandonment Trust Fund payments referenced above.
Paul Blakeley, President and CEO commented:
'We are starting to see solid growth feeding into the business and anticipate that the significant increases in production and revenue, coupled with flat production costs, will result in improving financial performance for the first half of 2024. We also expect that the second half will be even stronger, with Akatara capex behind us and production from this new, low cost, onshore asset ramping up in the coming weeks.
The start of commercial sales at Akatara, which is imminent, will be a major milestone for Jadestone, delivering a complex development on a fast-track schedule just over two years since the original investment decision was made, and will help to underpin our confidence in the significant increase in production we will see this year.
It is a year of major investment in the growth and the diversification of our production base, with not just the completion of the Akatara development project, but also the addition of a second tranche of the outperforming CWLH asset, including the payment of its future decommissioning cost. We will see significant benefits in 2025 and beyond from the cash flows that these activities will deliver, while the diversification of the business is further bolstered with the addition of the recently announced SFA Cluster PSC offshore Malaysia, adding to our pipeline of near-term growth opportunities at lower cost and higher returns.'
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Source: Jadestone Energy
